The Bangladesh Bank has approved the rescheduling of Ring Shine Textiles’ nearly Tk678 crore loans, granting the listed textile company a repayment period ranging from 7 to 10 years.
Documents reviewed by TIMES of Bangladesh show that the Bangladesh Bank selection committee approved the company’s loan rescheduling application in September, following its request in July.
On October 14, the central bank instructed the five banks servicing Ring Shine – Premier Bank, Dhaka Bank, Eastern Bank, One Bank, and Woori Bank – to reschedule all the company’s loans.
The company is required to pay 1 percent of the rescheduled amount upon submitting its application to the banks, with an additional 1 percent due in six months.
For term loans, Ring Shine will benefit from a two-year grace period, during which it will not face any repayment obligations. However, the company must clear its term loans in ten years.
In the case of working capital loans or overdrafts, the grace period is one year, with the maximum rescheduling period set at seven years, according to Bangladesh Bank.
The interest rate on the rescheduled loans will be 2 percentage points lower than the standard sector rate, as the central bank has mandated a preferential rate based on the banker-client relationship.
Repayments for the rescheduled loans will be made on a monthly or quarterly basis, with any missed installments leading to the loans being reclassified.
The banks are required to take necessary action within three months, as per the central bank’s directive.
Founded by Southeast Asian entrepreneurs, Ring Shine Textile began its yarn business in the Dhaka Export Processing Zone in 1998, eventually becoming the second-largest export-oriented yarn manufacturer in the country, according to the company’s application to the Bangladesh Bank.
Following its expansion, the company grew to be a top player in yarn dyeing, with a capacity of around 200,000 tons per day.
Ring Shine Textile went public in December 2019. However, its post-listing performance was marked by a series of challenges, including governance failures, illegal spending by a director, regulatory investigations, and penalties, all of which contributed to its financial difficulties.
In its July letter to Bangladesh Bank, Ring Shine cited its growing debt burden, which severely impacted its ability to continue operations, leading to multiple rounds of layoffs in 2021 and 2022.
After restructuring its board and management in 2023, the company resumed production, but faced setbacks due to difficulties in importing raw materials, which hampered its competitiveness.
Currently, Ring Shine has approximately $5 million in unfulfilled orders due to ongoing financial issues.
For the first nine months of the 2024-25 fiscal year, Ring Shine reported a revenue of Tk 240.8 crore, of which more than Tk 71 crore was spent on financial charges and interest.
An anonymous company official told TIMES of Bangladesh that 90 percent of the factory’s capacity remains unutilized.
Ring Shine’s shares, with a face value of Tk 10, closed unchanged at Tk 2.7 on the Dhaka Stock Exchange on Wednesday.
At the end of March, the company’s net asset value per share stood at Tk 10.42 in the negative.
