For International Leasing, Tk437cr collateral was enough for Tk4,500cr loan

Amid a series of loan scams crippling International Leasing and Finance Services Limited, a grave picture has come to light – the non-bank financial institution disbursed loans surpassing mortgaged assets by tenfold or without any mortgage in some cases.

The current board, set up by the High Court following widespread loan scandals, has found that the troubled NBFI lent around Tk4,500 crore against mortgaged assets valued at Tk437 crore only.

Now the board wants to sell the assets.

Md Mashiur Rahman, managing director of the NBFI, said, "There have been numerous irregularities in the disbursement of loans. In many cases, not even a single taka was kept as collateral, and some borrowers cannot be traced.

"Recovery efforts are underway by tracing the money through the bank accounts where loans were disbursed. Cases are also being filed for this purpose."

According to data from the NBFI, nearly one-third of disbursed loans were obtained by 14 companies owned by Prashanta Kumar Halder, also known as PK Halder, and his associates. These institutions have taken approximately Tk1,300 crore in loans by keeping only Tk304 crore in assets as collateral.

Out of 250 borrowers, International Leasing's loan position is over Tk2,000 crore to 31 large borrowers against mortgaged assets of Tk322 crore. 

Apart from this, the loans disbursed to small entrepreneurs against collateral amount to Tk115 crore.

How International Leasing is planning to turn around

International Leasing is now trying to make a turnaround by selling the mortgaged assets.

The NBFI is unable to return the customers' deposits as it cannot recover the loans. 

International Leasing is preparing a long-term scheme to return customer deposits. Under the scheme, the NBFI will seek time from depositors to repay their money over a long period but will clear their interest amount.

Md Mashiur Rahman said the deposits were misappropriated during the previous board, and the institution only exists but has no permanent assets, except for mortgaged assets. These assets will be sold, and the proceeds will be reinvested. From the interest income, the depositors will be paid their interest, and the institution will gradually be revitalised." 

International Leasing has also decided to issue new shares against deposits, and a scheme is also being prepared in this regard. The liability will be settled by selling shares of the company against the deposits.

Md Mashiur Rahman said the pressure will be reduced now that investment by selling mortgage assets and the issuance of shares against deposits are complete. As a result, if the limited resources are invested, International Leasing will receive some income.

PK Halder, associates' 14 firms took Tk1,350cr

Fourteen companies owned by PK Halder and his associates borrowed Tk1,339 crore from International Leasing with a mortgage of only Tk304 crore.

The International Leasing management has decided to sell the mortgaged assets as the owners are absconding and unable to find anyone to collect the debt.

Assets have been frozen in connection with a case filed by the Anti-Corruption Commission. These assets will be sold after getting cleared from the ACC.

A crocodile farm located in Bhaluka, Mymensingh, has already been sold for around Tk38 crore.

Imexo, Sandeep Corporation, Moon Enterprises, and Kanika Enterprises, owned by PK Halder, are among the companies that have taken loans from International Leasing.

Amitabh Adhikari, managing director of Annan Chemicals Industries Limited, Earthscope, RB Enterprises, SA Enterprises, and P&L International, is also a cousin of PK Halder.

Land purchased on loan from ILFSL mortgaged to other institutions

According to the financial report, Lipro International took a Tk126 crore loan from International Leasing and Financial Services to buy 109.78 decimals of land in Green Road, Dhaka.

But only 18.975 decimals were mortgaged to International Leasing, and the remaining 90.805 decimals were kept as collateral for FAS Finance.

Nazrul Islam Khan, chairman of International Leasing, said, "We have repeatedly written FAS Finance and Investments and FAS Capital management seeking to swap the loan agreements with International Leasing and International Leasing Securities, but the matter is not being resolved."

Wintel International took Tk100cr without collateral

A borrower of International Leasing, Wintel International owns a 10-storey building in Uttara.

The company mortgaged the building when it took a loan from FAS Finance but borrowed Tk100 crore from International Leasing without keeping any collateral.

Nazrul Islam Khan said in the 2022 annual report of International Leasing, "Although Wintel International took a loan without keeping collateral, International Leasing has to pay the company rent for having an office in the building year after year. International Leasing has a debt of Tk142 crore with FAS Finance, which is also not being recovered."

He said, by transferring the office, branch, and two subsidiaries to the building owned by Wintel by mutual liability adjustment (Swap), it will be possible to prevent the cash flow of around Tk3.55 crore per annum in rent and also recover the debt.

According to the annual report for 2022, International Leasing and Financial Services has Tk8,334 crore in liabilities.

Among the liabilities borrowed from banks, financial institutions, and agents are Tk1,312 crore.

Term deposit and other accounts total Tk2,869 crore, of which only the term deposit amount is Tk2871 crore, other deposits are Tk52.28 crore, and other liabilities amount to Tk4,152 crore.

The term deposit refers to deposits from individuals and institutions for a period of not less than three months.

Other deposits represent deposits received against leases and direct financing on signing of the agreement, which are subject to repayment on expiration of the agreement.

The non-bank financial institution disbursed Tk4,126.87 crore. Of which, 90.86%, or Tk3,749 crore, is classified. Only Tk377 crore is unclassified, according to its latest annual report for 2022.