Bangladeshi Steel Ship Breakers Default on Large Loans
Ship Breaking South Asia Journal

Bangladeshi Steel Ship Breakers Default on Large Loans

Bangladesh’s Daily Industry News reported that Chattogram based steel and ship breaking industry has defaulted on BDT 10,000 crore in

Bangladesh’s Daily Industry News reported that Chattogram based steel and ship breaking industry has defaulted on BDT 10,000 crore in the last eight years and banks are concerned about recovering the debt mounting every year as many businessmen have already dropped out of the steel and shipbreaking businesses. Dhaka Bank Limited Executive Vice President Mr Zahed Iqbal said “Bankers are also responsible for the whopping bad debts to the steel and shipbreaking industry. Because they approved the loans at that time without any credit assessment and risk analysis. They even competed with one another in giving loans. With the loans, most of their clients bought lands, spent it on luxuries, or siphoned off the money abroad. Bank officials are now bearing the brunt of the bad debt.”

Shipbreaking industry people say bankers were lending with a free hand to everybody and to new steel and shipbreaking businessmen in 2008-2012. It seemed banks were competing to lend to the steel sector and fulfil their annual lending targets. After availing the loans, many businessmen purchased land and spent easy money on luxuries. But the 2013 international and local steel market collapse dealt the industry a heavy blow, forcing steel enterprises into huge losses. In the face of market collapse, there were cases of steel scrap selling for USD 220 per ton in the local market after buying that at USD 760 from the international market. The steel newbies then started to disappear. Not only newcomers to the steel sector, but many old enterprises became loan defaulters too. Since then, the number of defaulters has been on the rise as has the volume of steel bad debt.

As per report, bad debt list includes

⦁ Rising Steel - BDT 2,591 crore

⦁ RSRM - BDT 1,696 crore

⦁ Mishmak Group - BDT 1,500 crore

⦁ Rubaiya Group - BDT 900 crore

⦁ Maheen Enterprise - BDT 935 crore

⦁ MAC International - BDT 800 crore

⦁ Shah Amanat Iron Mart - BDT 600 crore

⦁ Mabia Ship Breakers BDT 529 crore

⦁ Ehsan Steel - BDT 484 crore

⦁ Ambia Steel - BDT 300 crore,

⦁ SK Steel BDT 314 crore

⦁ Peninsula Steel - BDT 300 crore

⦁ Peninsula Steel - BDT 250 crore

⦁ Super Six Star - BDT 150 crore

⦁ Benz Industries - BDT 140 crore

⦁ Crystal Steel and Ship Breaking - BDT 135 crore

⦁ Mostafa Steel of Mostafa Group - BDT 125 crore

⦁ Jilani Traders - BDT 108 crore

⦁ Hillview Ship Breaking - BDT 83 crore

⦁ GK Steel - BDT 75 crore

⦁ Tanha Steel - BDT 71 crore

⦁ Rashed Iron Steel - BDT 65 crore

⦁ Arafat Steel - BDT 60 crore

⦁ Fortune Ship Breaking Industries - BDT 53 crore

⦁ S Steel Enterprise - BDT 47 crore

⦁ Shahed Ship Breaking - BDT 44 crore

⦁ SM Steel - BDT 43 crore

⦁ Joynal Steel - BDT 36 crore

⦁ AK Enterprise - BDT 36 crore

⦁ Raihan Metal - BDT 35 crore

⦁ Shakib Steel - BDT 33 crore

⦁ Unique Steel - BDT 26 crore

⦁ RM Steel - BDT 24 crore

⦁ Sultana Ship Breaking - BDT 19 crore

⦁ Premier Steel - BDT 15 crore

⦁ Khwaja Ajmer Ship Breaking - BDT 11 crore.

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