Bangladesh Bank Permits SS Power-1 to Open Import LCs

Bangladesh Bank has granted permission to SS Power-1 Limited, a power generation enterprise owned by the prominent conglomerate S. Alam Group, to open import Letters of Credit (LCs) under a mandatory 100 per cent cash margin condition. The central bank has authorized state-owned Rupali Bank to facilitate these import LCs on behalf of the power project.

On Sunday, 16 August, the Banking Regulation and Policy Department-2 of Bangladesh Bank issued two separate official directives detailing the decision.

Under the regulatory framework outlined by the central bank, Rupali Bank is permitted to process import LCs for SS Power-1 Limited provided that the entire value is covered upfront by a 100 per cent cash margin. All scheduled banks operating across the country have been instructed to follow the official circular in managing related financial proceedings. Additionally, the secondary directive stipulates that the restriction under Section 27KaKa(3) of the Bank Company Act, 1991—which typically limits credit extensions under specific ownership and liability conditions—will remain suspended for this specific transaction until 31 December 2027.

The central bank has nevertheless attached a strict condition to this regulatory relaxation. Bangladesh Bank explicitly declared that no financial obligation or liability will accrue to the central bank regarding these credit arrangements. Furthermore, Rupali Bank will be barred from claiming any form of financial assistance, liquidity support, or indemnity from the central bank in connection with this facility in the future.

The SS Power-1 plant is located at Gandamara in the Banshkhali region of Chattogram. Designed with a total capacity of 1,320 megawatts, the facility represents one of the largest private sector coal-fired thermal power installations in Bangladesh.

Constructed at an estimated cost exceeding 2.6 billion US dollars (equivalent to over 28,000 crore Bangladeshi Taka), the venture operates under a joint partnership structure. S. Alam Group holds the controlling 70 per cent equity stake, while the remaining 30 per cent interest is jointly owned by Chinese engineering firms SEPCOIII Electric Power Construction Corporation and HTG Development Group.

The power complex features two distinct operational units, each with a generating capacity of 660 megawatts. Experimental power delivery from the first unit commenced on 24 May 2022, followed shortly by test supply from the second unit on 28 June 2022. The entire facility officially synchronized with the national power grid on 14 January 2023, bringing its full 1,320-megawatt capacity online to support national grid stability and power supply needs across the southern region.