Bangladesh Bank has granted Abdul Monem Sugar Refinery Limited special permission to open import letters of credit (LC) with a 100 percent cash margin, even though the company is a corporate guarantor of a defaulted loan. The central bank issued the directive on Monday, suspending the application of Section 27Ka(3) of the Bank Company Act, 1991, for the company until June 30, 2027. The decision was made under the authority of Section 121 of the same law, with the condition that no financial loss to the government or Bangladesh Bank may result from this facility.

According to the source, Abdul Monem Sugar Refinery is the corporate guarantor of a defaulted loan of Abdul Monem Limited at state-owned Agrani Bank. As of March 2025, Abdul Monem Limited had defaulted loans totaling Tk 698 crore across 24 banks and financial institutions, including Tk 455 crore owed to Agrani Bank. The refinery sought the special LC facility on June 7, citing existing international contracts for raw sugar imports and potential daily penalties of about USD 23,000 if delayed.

The refinery is currently operated by Abul Khair Limited under a sales agreement, marketing sugar under the 'Starship Sugar' brand, though ownership transfer is still pending.