AB Bank’s Crisis Deepens as Bad Loans Hit 82% of Portfolio
AB Bank is facing a severe financial crisis after its bad loans surged to 82% of its total loan portfolio. The bank’s troubles deepened following a regulatory review that exposed previously hidden defaults. By September 2025, the institution reported losses, liquidity shortages, and a near-collapse of its deposit base.
The crisis began when Bangladesh Bank conducted an asset quality review of AB Bank. The inspection forced the lender to reclassify a large number of loans as non-performing, causing its NPL volume to jump from Tk 8,840 crore in March 2025 to Tk 30,138 crore by September. Of these, Tk 27,711 crore were deemed unrecoverable.
By the end of September 2025, the bank’s total loans stood at Tk 36,804 crore, with deposits worth Tk 34,465 crore—almost all of which were exposed to defaulted loans. The financial strain worsened when customers rushed to withdraw funds, prompting AB Bank to seek Tk 2,000 crore in emergency liquidity support from the central bank on November 11, 2025.
The bank had already reported heavy losses in 2024, recording a deficit of Tk 1,905 crore after a modest profit of Tk 89.37 crore the previous year. On November 19, 2025, Syed Mizanur Rahman, the managing director and CEO, resigned amid the escalating crisis.
AB Bank now faces a critical situation with most of its loans defaulted and deposits at risk. The central bank’s intervention and the CEO’s departure mark a turning point in the bank’s struggle to stabilise. Recovery efforts will depend on addressing the massive volume of unrecoverable loans and restoring depositor confidence.
