The International Leasing and Financial Services Ltd's net asset has suddenly turned into huge liabilities, with the company posting a big loss in its history that has become a bad example in the non-banking financial institution sector.
Although the company posted Tk285 crore as its net asset value at the end of the first three quarters ending on 30 September last year, the amount turned into liabilities of Tk2,773 crore at the end of 2019.
Besides, the company suddenly incurred a huge loss of Tk2,802 crore in 2019. Its net profit was Tk11.22 crore just the previous year.
That is why the company did not recommend any dividend to its shareholders for the first time since it was listed on the Dhaka Stock Exchange (DSE).
After the news came out on 5 November, the company's share price came down by 20% to Tk5.70 each in two days at the DSE.
The company said in its financial statement that it had slipped into such a situation while following the instructions of the Bangladesh Bank.
But a senior official of the company said they had faced several major debt scandals last year and Prashanta Kumar (PK) Halder's debt scandal was especially responsible for the plight.
The allegation of embezzlement against PK Halder, former director of the company, surfaced after the Anti-Corruption Commission (ACC) had launched an inquiry into the wealth of illegal casino owners last year.
Halder and his accomplices misappropriated around Tk3,500 crore from International Leasing. The ACC is investigating the allegations against him.
He was the deputy managing director of Industrial and Infrastructure Development Finance Company (IIDFC) in 2008. With 10 years of banking experience, he joined Reliance Finance as the managing director in 2009. He became the managing director of the NRB Global Bank in July 2015.
Halder got the loans without any mortgage. As a result, the ACC said, there was almost no chance that the loans would be repaid.
In a bid to save the dying financial institution, the court appointed the former governor of the Bangladesh Bank, Khandaker Ibrahim Khalid, as the chairman, but he later resigned. After that, the central bank appointed former secretary Md Nazrul Islam Khan as the company's chairman.
On 8 January this year, the ACC filed a case against Halder for amassing properties worth around Tk274.91 crore from unknown sources.
Later, on 21 January, in response to a petition filed by several investors over siphoning off Tk3,500 crore, the High Court ordered the authorities concerned to freeze bank accounts and seize passports of 19 accused, including Halder.
However, Halder fled to Canada in October last year.
In September this year, Halder said he would come back to the country to return the money and settle the transactions and liabilities with the company if he got proper security for his life.
International Leasing lawyers then filed a petition with the High Court, seeking assurance that he would not be arrested or harassed after his return.
After the hearing, the court passed its order, instructing the authorities concerned to arrest him immediately upon his return.
His lawyer told the High Court he was not returning due to the Covid-19 pandemic.
At the end of September last year, International Leasing's total borrowing and deposits from various banks, financial institutions and individuals stood at Tk3,847 crore. Also, the company disbursed Tk3,915 crore in loan, advance and lease as of then.