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Troubled lender Global Islami Bank could not fully utilise the proceeds from its initial public offering (IPO) within the stipulated timeframe and is now seeking an extension until November 2026 to complete the fund deployment.
The fourth-generation Shariah-compliant bank raised Tk 4.25 billion from the capital market in November 2022 to invest in small and medium enterprises (SMEs), government securities, listed securities and bonds, and meet the IPO-related expenses.
According to the latest IPO fund utilisation report, the bank has invested Tk 3.51 billion as of June this year. Of this, Tk 1 billion has been invested in the SME sector, Tk 2.15 billion in government securities, and Tk 300 million in listed securities and bonds. Additionally, Tk 61.80 million was spent on IPO-related expenses.
This leaves Tk 740 million of the IPO proceeds, including Tk 3.20 million allocated for IPO expenses, unutilised as of June 2025.
As per the IPO prospectus, the bank was required to deploy the entire fund within 24 months of receiving it, a deadline that expired on November 9, 2024.
The bank stated that its shareholders approved in August last year the reallocation of the unutilised IPO expense of Tk 3.20 million to the SME investment head, subject to approval from the Bangladesh Securities and Exchange Commission (BSEC) and other relevant regulators.
The bank then sought an additional 24 months to complete the utilisation of the IPO proceeds by 9 November 2026, according to a stock exchange filing.
"The IPO proceeds could not be fully utilised due to lack of potential investors in the SME sector and volatile capital market, Russia-Ukraine war, political unrest in the country and also war and conflicts in the Middle East," said the bank in another stock exchange filing on Wednesday.
Stock market listing in 2022
In November 2022, Global Islami Bank got listed as the second largest IPO in terms of amount of money raised from the capital for any bank in the country's capital market history.
Soon after the listing, the bank made headlines for granting large loans in violation of banking rules & regulations as the bank was controlled by influential Chattogram-based S Alam Group.
The Bangladesh Bank reconstituted the board of the bank in August last year soon after the political changeover, removing S Alam Group's control following the ouster of the Hasina-led government.
The real financial condition of the bank has been exposed as the new board is adjusting huge provisions against bad loans that were not maintained properly previously.
Subsequently, the bank reported a massive loss of Tk 9.39 billion in the April-June quarter 2025 while half-yearly losses escalated to Tk 17.17 billion in January-June this year as a significant portion of its loans turned toxic.
What is more, the accumulated loss of the bank soared to Tk 49.74 billion as of June 2025, according to a recent disclosure of the bank posted on the DSE website.
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