Bangladesh’s Financial Institutions Division has instructed state-owned BASIC Bank to exercise special caution in new lending and work toward becoming a well-governed, financially sustainable CMSME-focused commercial bank. The directives were issued at a recent special meeting chaired by Financial Institutions Division Secretary Nazma Mobarek, attended by the bank’s board, managing director and other officials. The government’s roadmap aims to restore the bank after years of financial irregularities and weak management.

The bank was severely affected by major loan scandals and irregular disbursements between 2009 and 2014. Much of the lending later became non-performing, weakening its financial base, while capital shortages and a loss of depositor confidence disrupted normal operations. As of December 2025, BASIC Bank’s non-performing loan ratio stood at about 56 percent, among the highest for state-owned banks.

Officials set 12 priority actions for the next 12 to 24 months, including direct cash recovery from defaulted and written-off loans, prevention of fresh defaults and strengthened internal controls. The bank was told to assess borrowers’ repayment capacity, cash flow, group exposure, beneficial ownership and collateral values before approving major loans. Managing Director Md Kamruzzaman Khan said future programmes would follow the ministry’s instructions.