Banks want legal permission to publish photographs of loan defaulters as part of a broader push to tighten enforcement and speed up recovery of bad loans, according to proposals submitted by the Association of Bankers, Bangladesh (ABB) to Bangladesh Bank.
Bangladesh Bank first took an initiative in 2014 to publish lists of loan defaulters at the branch level. That move was halted following a High Court directive secured by the Bangladesh Association of Banks, the body representing bank sponsor-directors.
Similar attempts were made again in 2018 and 2019, but those efforts also stalled amid political influence. The issue resurfaced in several meetings at the Finance Ministry in 2021 as part of discussions on recovering defaulted loans, yet the proposal to publish defaulter lists was not implemented.
The proposals were submitted on December 7, 2025, following a meeting with Governor Ahsan H Mansur on 12 November. The letter was signed by Mashrur Arefin, chairman of ABB and managing director of City Bank.
The move comes as the banking sector faces its most severe loan crisis on record. Of the Tk18,03,840 crore in total loans disbursed as of September, about Tk6.5 lakh crore has turned defaulted. That means 35.73 per cent of all outstanding bank credit is now in default, according to sector data.
The volume of bad loans is now about 4.8 times higher than when the government last disclosed the total number of defaulters – 786,065 borrowers – in early 2023. Since then, no updated nationwide figure on the number of defaulted borrowers has been made public.
Bank CEOs say the goal is to reduce defaulted loans and increase cash recovery that has been slowed by lengthy legal disputes and procedural barriers.
One group of proposals would place tighter restrictions on borrowers who have defaulted. ABB wants legal measures so that defaulters cannot travel abroad without court directives. It has also asked for permission to publish the names and photographs of defaulted borrowers and to bar them from contesting elections of business associations.
The association also wants to change how defaulters challenge bank actions in court. It proposed that borrowers must deposit a specified down payment before going to court against any recovery step taken by a bank or a lower court.
ABB also asked for removing the legal scope for obtaining High Court stay orders against Credit Information Bureau (CIB) classification. Where courts do grant stays, the bankers proposed that borrowers must make instalment payments at a significant rate and that the stay should be treated as cancelled if those payments are not made.
The banking industry’s push comes amid long-running legal battles that have slowed recovery. Bangladesh Bank data cited in recent reports show that as of June last year, loans worth Tk1.63 lakh crore involving more than a thousand borrowers were not being shown as defaulted because of court stay orders, keeping a large volume of stressed loans outside official default figures. At least 31 candidates in the 13th national election are contesting after securing High Court stay orders against the cancellation of their nominations over CIB reports.
Several proposals aim to strengthen enforcement. ABB asked for a system allowing banks to obtain a wide range of personal and financial records of defaulted borrowers and their guarantors without court intervention, including deposit details, asset ownership information, tax return data and passport information.
It also proposed setting up separate money loan courts in districts with large numbers of defaulters, faster execution of arrest orders and extending civil detention in loan cases from six months to as long as seven years depending on the loan size.
At the same time, the bankers have put forward technical changes to improve recovery. These include allowing partial write-offs of defaulted loans under international standards and speeding up the sale of lien shares.
The proposals also seek to ease approval conditions so banks can recover loans more quickly. This would apply in cases involving death, terminal illness or natural disasters affecting individual borrowers and small businesses.
A large part of the package focuses on selling collateral more quickly. ABB asked for removing income tax and VAT on property transfers through bank auctions, offering incentives to auction buyers and removing the need for district administration approval in certain cases.
It also called for faster cooperation from sub-registry offices, allowing banks to complete land tax and survey procedures if the mortgagor is absent and ensuring automatic mutation of land transferred to banks by court order.
To prevent future defaults, ABB recommended that Bangladesh Bank publish a centralised list of approved land surveyors and valuers, make it easier to verify mortgaged assets at land offices and develop a national database of personal assets similar to the credit bureau system.
Taken together, the proposals represent one of the most extensive attempts by bank leaders to change the legal framework for loan recovery.
Measures aimed at faster collateral sales and clearer write-off rules address procedural delays that banks say have built up over years, City Bank CEO Mashrur Arefin told TIMES of Bangladesh.
At the same time, analysts say proposals involving public disclosure of defaulters, wider access to personal financial data and tighter limits on court challenges raise questions about how to balance faster recovery with legal safeguards.
