Bangladesh Bank has moved to liquidate nine non-banking financial institutions after years of irregularities, chronic mismanagement, and their failure to repay depositors, in what marks one of the most extensive clean-up efforts the sector has seen.

The central bank’s Board of Directors approved the decision at a meeting on 30 November, allowing regulators to begin formal proceedings under the Bank Resolution Ordinance 2025, officials said.

An executive director told UNB that the board had endorsed the plan and that the central bank would now scrutinise the institutions before finalising the list for dissolution.

The entities identified for closure include Peoples Leasing and Financial Services, International Leasing and Financial Services, Aviva Finance, FAS Finance and Investment, Fareast Finance and Investment, Bangladesh Industrial Finance Company, Premier Leasing and Finance, GSP Finance Company, and Prime Finance and Investment.

The shortlist was prepared using indicators such as persistent failure to return depositor funds, rising non-performing loan,s and acute capital shortages. Regulators will now determine the liquidation framework for each institution.

Preliminary assessments suggest the government may need to inject about Tk 90 billion to settle liabilities, with priority given to small depositors. While the move is being undertaken under the 2025 ordinance, Bangladesh Bank is also advancing licence cancellations under the Finance Company Act 2023.

Of the 35 NBFIs operating in the country, 20 are currently classified as distressed. The nine institutions were issued notices on 22 May but failed to provide adequate responses, prompting the regulator to proceed with the liquidation process.