26 borrowers seek probe into Premier Bank over irregularities

Twenty-six borrowers owning export-oriented garment factories have called for an independent investigation into the Narayanganj branch of Premier Bank PLC, accusing the institution of multiple banking irregularities, including alleged fraud in back-to-back letters of credit and foreign currency transactions.
The allegations were brought in a written statement read out by Dowas-Land Group Managing Director Arifur Rahman at a press conference held at the office of the Economic Reporters’ Forum (ERF) in the capital on Saturday.
The businessmen sought intervention from Bangladesh Bank, the Ministry of Finance, and other relevant government authorities, citing a written complaint submitted to the central bank governor on 6 April.
All 26 entrepreneurs are members of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).
In the statement, the businessmen alleged that certain officials of the Narayanganj branch of Premier Bank created fake sales contracts using fraudulent IDs and opened multiple back-to-back LCs despite no actual import of raw materials taking place.
They alleged that liabilities created against those LCs were later shown as settled through current accounts, while US dollars were allegedly purchased from the foreign exchange market in an irregular manner.
The entrepreneurs claimed they were forced to purchase US dollars at rates Tk12 to Tk15 higher than prevailing market prices, creating enormous financial pressure on their businesses.
They further alleged that 80–90% of export proceeds were deposited into current accounts and later used to buy dollars to settle liabilities against the so-called back-to-back LCs. During this process, the bank allegedly created “forced loans” and “demand loans” unilaterally and imposed substantial interest without notifying clients.
The business owners also accused the bank of violating Bangladesh Bank’s foreign exchange guidelines by adjusting LC liabilities through current accounts, cash deposits, and artificial loan creation.
Despite repeated requests, they said, the bank failed to provide complete account statements. In some cases, they alleged, blank cheques were used to file cases under the Money Loan Court Act.
The businessmen said bank officials also threatened to cancel LC and other credit facilities unless they signed rescheduling agreements. As a result, factory operations and workers’ salaries came under severe risk, triggering labour unrest and raising fears of factory closures.
Many companies, they said, eventually agreed to loan rescheduling under pressure, but Bangladesh Bank later cancelled those arrangements, causing banking operations of 23 factories to be suspended.
The entrepreneurs alleged that intense pressure from the bank and mounting loan-related stress contributed to the deaths of two managing directors.
They said they remain willing to repay legitimate liabilities if allowed to continue business operations. Keeping the factories operational, they argued, would not only help recover dues but also protect nearly 25,000 workers from unemployment.
Speaking to Daily Sun, DM Emran, managing director of Knit Reflex Ltd, said he had sent 22 letters to various authorities since 2022 seeking resolution of the matter.
“Thousands of workers are suffering because the issues remain unresolved,” he said.
Earlier, a Bangladesh Bank investigation reportedly uncovered the siphoning off of nearly Tk10,500 crore through inflated export orders routed via Premier Bank’s Narayanganj branch between 2018 and 2023.