Sammilito Islami Bank begins returning principal deposits to individual customers

Individual depositors of Sammilito Islami Bank will be able to withdraw the principal amount of their deposits from today (Monday), following a week-long delay in the planned disbursement.

The bank began accepting applications on September 1, with the submission window closing on Sunday. 

Customers were required to apply at their respective branches or sub-branches. The applications were then forwarded to the bank’s head office, which will arrange the required cash based on customer demand and send the funds to the concerned branches for disbursement.

Bangladesh Bank has provided Tk 5,000 crore to facilitate the return of depositors’ funds. So far, around 75,000 customers have applied over six days, seeking a total of Tk3,925 crore.

Under the bank’s current arrangement, individual depositors will initially receive only the principal amount of their deposits. Profits accrued on the deposits will be paid at a later stage.

Institutional depositors, however, will not be allowed to withdraw funds immediately outside the previously announced withdrawal scheme.

Applicants must state the total amount deposited in their account, the amount they wish to withdraw and the reason for the withdrawal.

Bank officials said the deposit repayment programme was originally scheduled to begin on September 1. 

However, the launch was postponed by a week to complete certain formalities.

The latest repayment initiative follows amendments to the deposit withdrawal scheme announced for the bank last year.

Sammilito Islami Bank was formed through the merger of five banks that had been facing severe financial distress amid allegations of irregularities and fraud. The banks are EXIM Bank, Social Islami Bank, First Security Islami Bank, Global Islami Bank and Union Bank.

Since 2022, the five banks had struggled to meet depositors’ demands for withdrawals. During the tenure of the interim government, the five troubled banks were merged to create the new entity.

Sammilito Islami Bank has total capital of Tk30,000 crore, of which the government has contributed Tk20,000 crore.

The five merged banks had around 7.6 million depositors with combined deposits of approximately Tk142,000 crore.

Of the total deposits, individual depositors held around Tk15,000 crore in savings accounts.

Meanwhile, the banks’ combined loan portfolio stood at around Tk192,000 crore, with nearly 86 percent classified as defaulted loans.