The government has taken a loan of 10,000 crore from Sammilito Islami Bank.

In a landmark move, the Government of Bangladesh is set to borrow Tk10,000 crore from the newly formed Sammilito Islami Bank by issuing a 10-year Shariah-compliant Sukuk (Islamic bond). This represents the largest investment to date for the bank, with the government expected to earn a profit of 9.75% per annum on the bond.

According to Bangladesh Bank, a meeting of the Shariah Advisory Committee—chaired by Deputy Governor Md Kabir Ahmed—was held on 7–8 January to finalise the terms of the Sukuk. The Committee approved the issuance of the Sukuk through the lease-based (Ijarah) method, marking a significant step in the government’s strategy to mobilise long-term, interest-free funds.

The Sukuk, named “Bangladesh Government Special Sukuk-1”, will be issued directly to Sammilito Islami Bank via private placement, with the funds scheduled to be transferred to the government on 14 January. The underlying assets for the Sukuk include seven housing projects under the Public Works Department for government employees and select Bangladesh Railways train services.

Sector analysts have highlighted that this initiative will not only provide substantial capital for development projects but also offer a safe and Shariah-compliant investment opportunity for the Islamic banking sector.

The creation of Sammilito Islami Bank stems from a previous financial crisis during the prior Awami League government, when several banks faced major loan defaults due to fraudulent withdrawals. To address this, five struggling banks—Exim, Social Islami, First Security Islamic, Global Islamic, and Union—were merged to form the new entity.

The bank’s paid-up capital has been set at Tk35,000 crore, with the government contributing Tk20,000 crore and the remaining Tk15,000 crore raised through depositor shares. The authorised capital stands at Tk40,000 crore.

According to Bangladesh Bank data, the five merged banks previously held Tk142,000 crore in deposits from 7.5 million depositors, but had extended Tk193,000 crore in loans, a large portion of which have already defaulted. Together, they operate 760 branches, 698 sub-branches, 511 agent banking outlets, and 975 ATMs nationwide. Post-merger, overlapping branches will be consolidated, and employee salaries and allowances have been reduced by 20% to streamline operations.

Key Facts at a Glance

This Sukuk issuance marks a milestone in Bangladesh’s pursuit of Islamic finance-driven development while stabilising the nation’s banking sector, offering both government funding and secure investment avenues for the public.