S Alam Group‍‍`s mortgaged property being auctioned for first time

Janata Bank has announced an auction of the collateral property of ‘Global Trading Corporation Limited’, a subsidiary of S Alam Group, to recover defaulted loans of Tk 1,850 crore.

Janata Bank hopes to recover a fifth of the dues by selling off the group’s collateral land in Chattogram, Gazipur.

This marks the first time a bank has moved to auction the mortgaged assets of an S Alam Group, a business conglomerate, amid allegations that the group siphoned off billions of taka from various banks through loans during former Prime Minister Sheikh Hasina‍‍`s 15-year tenure.

The bank announced the auction, set for November 20, in newspapers on November 1 and invited interested parties to submit their bids.

According to bank insiders, the value of the mortgaged assets, consisting of 1,860 decimals of land across Chattogram and Gazipur, have a maximum market value of Tk358 crore, which is less than a fifth of the total amount due.

This valuation is almost five times less than the amount owed. It is not possible to fully recover the defaulted debt by selling this property. Further legal action may be required to recover the outstanding balance.

According to section 12(3) of the Debt Court Act, the money can be recovered by selling the collateral property before the bank files a case.

In an audit report of the Comptroller and Auditor General (CAG) of Bangladesh in 2021, the Global Trading Corporation has taken additional loans beyond the credit limit without complying with the guidelines of Bangladesh Bank.

According to S Alam Group‍‍`s website, the global trading corporation established in 2012 was engaged in the trading of industrial raw materials, commercial products, and construction materials.

According to the report, in 2012, Global Trading Corporation initially took a loan of Tk 650 crore from Janata Bank‍‍`s Chittagong corporate branch located in the General Insurance Building.

This loan has reached a total of Tk1070.65 crore until the year 2021. Of this, Tk 617.47 crore is PAD (Payment Against Document), Tk 223.18 crore is LTR (Trust Receipt) loan and Tk 229.99 crore is CC hypo loan. The amount of loan with interest increased to Tk 1850 crores in September 2024.