Janata Bank is set to auction some 1,860 decimals of land belonging to S Alam Group to recover a total of Tk 18.5 billion owed by the group’s subsidiary Global Trading Corporation.
The auction is scheduled for 20 November at the bank’s corporate branch at Sadharan Bima Bhaban in Chattogram. The loan was disbursed from that branch.
According to sources, S Alam Group has been a client of the bank since 2004. It took a total of Tk 101 billion in loan from the Sadharan Bima Bhaban branch, and the amount is more than 80 per cent of the branch’s total disbursal. The entire loan is now defaulted, while the bank holds properties worth Tk 27.49 billion as mortgage.
For now, the auction has been called for the loan disbursed in favour of Global Trading Corporation only, and similar action will be taken for the loans to the group’s other entities.
The loan defaulted in June this year. An initiative was taken to reschedule the loans, but the regulator did not approve it. Hence, the auction has been called to recover the loansGolam Mortuza, acting managing director of Janata Ban
In this regard, Golam Mortuza, the acting managing director of Janata Bank, said the loan defaulted in June this year. An initiative was taken to reschedule the loans, but the regulator did not approve it. Hence, the auction has been called to recover the loans.
According to the bank sources, some 1,860 decimals of land in Chattogram and Gazipur were kept as mortgage against the loans. The lands in Chattogram are located in Patiya, Karnaphuli, Kotwali, Chandgaon, and Bakliya upazilas – with a total market value of Tk 3.5 billion.
Generally, proceeds from selling properties on auction do not cover the entire loans. Hence, it will be followed by legal actions, and there is a scope to liquidate the client’s other assets to meet remaining loan obligations.
According to S Alam Group’s website, the Global Trading Corporation, which was established in 2012, is engaged in business of industrial raw materials, commercial products, and construction materials.
S Alam Group chairman Saiful Alam is familiar as a close ally of former prime minister Sheikh Hasina. During the previous regime, he took over several banks, including Islami Bank, Social Islami Bank, and Bangladesh Commerce Bank.
There are allegations that the group withdrew nearly Tk 2 trillion from banks under its control. In the aftermath, general clients are struggling to collect their deposits from the particular banks.
Following the downfall of the Awami League government, Bangladesh Bank has intervened and freed the banks from S Alam Group’s control.
Saiful Alam and the group’s executive director Subrata Chowdhury could not be reached for comments despite repeated calls over the phone.