TDS Desk:

How has business been this year? Most commercial banks would probably say that it has been a struggle just to stay afloat amid financial turmoil, falling appetite for credit, and a surge in bad loans.

Yet six commercial lenders have bucked the trend. Their profits in the first nine months of 2025 have already beaten their total gains from last year, thanks mainly to strong returns from treasury bills and bonds.

The performance comes as a surprise to their peers and breaks the familiar pattern of Islami Bank, the country’s largest shariah-based lender, consistently logging the highest profit growth.

The six banks are BRAC Bank, Pubali Bank, Jamuna Bank, Bank Asia, Shahjalal Islami Bank, and Dhaka Bank.

Some other banks, like Eastern Bank, Prime Bank, and City Bank — which were marked as sustainable banks by the central bank, also recorded handsome profit growth over the nine-month period.

Meanwhile, Islami Bank managed to stay in the black, posting a profit of Tk 99 crore, down from Tk 108 crore in the same period last year.

Though returns from treasury bills and bonds helped the six banks lift their profits, their interest income from lending, the heart of the banking business, has fallen.

Combined, these banks earned Tk 7,411 crore from investments, mostly in treasury bonds, a roughly 70 percent increase from the previous year. At the same time, their net interest income fell 33 percent to Tk 2,547 crore.

“The banking market is highly skewed, so profits vary widely,” said Shah Md Ahsan Habib, professor at the Bangladesh Institute of Bank Management (BIBM).

He added the situation worsened after the political changeover last year, following which several banks fell under the scanner and their long-buried bad debts got exposed subsequently.

Distressed loans at banks rose 59 percent to a record Tk 756,526 crore in 2024, exposing the fragile state of the financial sector. These loans accounted for 45 percent of total outstanding loans, roughly Tk 1,682,878 crore, close to the national budget for fiscal year 2025-26.

Among distressed assets, defaulted loans reached Tk 345,765 crore, rescheduled loans Tk 348,461 crore, and written-off loans Tk 62,300 crore, according to the Bangladesh Bank (BB).

“Deposits shifted from weaker banks to better-managed ones. Well-governed banks attracted higher deposits, but the overall business environment remains uncertain,” said BIBM Prof Habib.

He said some entrepreneurs closed factories or left the market, pushing down overall demand for credit. Banks, in turn, have been cautious with lending and focused on recovering loans.

BB data for the first two months of the current fiscal year show credit to the private sector rose just 6.35 percent, the slowest in more than two decades.

“With limited demand for loans and a shallow bond market, banks have turned to treasury bonds to protect their bottom line,” Prof Habib said.

“Although banks are earning from treasury investments, we expect them to support lending and industry to boost GDP growth.”

Among the top performers, BRAC Bank led the group with a nine-month profit of Tk 1,536 crore, up from Tk 1,432 crore in 2024. The bank attributed the rise to stronger investment income and higher deposit mobilisation, though loan growth remained subdued.

Pubali Bank posted Tk 900 crore, up from Tk 762 crore.

Pubali Bank Managing Director Mohammad Ali said the bank’s asset quality improved over the past nine months and returns from government securities were healthy.

He also noted that income from international business was good amid signs of economic stabilisation.

Jamuna Bank earned Tk 416 crore, compared with Tk 279 crore in 2024. Its statements attributed the rise to higher investment and other operating income.

Bank Asia recorded Tk 351 crore, up from Tk 277 crore, with operating profits supported by nearly doubled investment income, which rose to Tk 1,930 crore from Tk 979 crore.

Shahjalal Islami Bank reported Tk 389 crore, up from Tk 169 crore.

Managing Director Mosleh Uddin Ahmed cited three factors behind the increase. Those are stable deposit costs, controlled operating expenses, and higher investment returns.

He also highlighted gains in the export-import business and projected healthy future growth, especially in garment-related trade.

Dhaka Bank earned Tk 140 crore, surpassing its 2024 total of Tk 127 crore. The bank mentioned lower operating profits but improved cash flow due to higher customer deposits during the past nine months.

Other banks saw profits in the first nine months, though they have yet to surpass their full-year 2024 earnings.

Profit by Eastern Bank grew 26 percent year-on-year to Tk 584 crore. In the past nine months, Prime Bank posted Tk 630 crore compared with Tk 732 crore last year.

City Bank reported Tk 722 crore and Dutch-Bangla Bank Tk 256 crore profits in the first nine months of this year.