For Bangladesh’s controversial S Alam Group, rebuilding a collapsed financial empire is proving much harder than creating it.
Widely linked to banking scandals, massive loan fraud, and money laundering, the once-untouchable Chattogram conglomerate is now reeling from asset freezes, legal pressure, and intense public scrutiny.
For financial insiders, the ultimate question is no longer how the group lost its banking stronghold, but whether it can ever win it back.
Since the Awami League government’s fall, successive administrations have taken a tough stance against the group.
Under the Muhammad Yunus-led interim government, Bangladesh Bank launched a sweeping crackdown on banks allegedly controlled by S Alam, including Islami Bank Bangladesh PLC. The regulator dissolved and restructured multiple bank boards, froze around 82% of the group’s shares, and moved to seize major assets and accounts.
The action triggered mass layoffs across linked banks, affecting thousands of employees, many from southern Chattogram, especially Patiya, founder Saiful Alam’s home base.
Even after the BNP-led government took office, speculation persisted that S Alam might regain influence through political shifts, intensified after former Bangladesh Bank governor Ahsan H Mansur’s exit.
In Chattogram’s Khatunganj, early signs of renewed activity, employee protests, and lobbying reignited debate over the group’s possible banking sector return.
But as months passed, a different picture emerged. Despite political transitions and intense lobbying, most punitive actions remain firmly in place. Investigations have deepened. Asset recovery efforts expanded internationally.
Inside government, discussion appears increasingly focused not on rehabilitating S Alam, but on recovering billions of dollars investigators believe were siphoned from Bangladesh’s banking system.
Protests fail to shift momentum
One of the most distinct attempts to restore influence emerged through coordinated demonstrations by dismissed bank employees.
Former officers and staff terminated from six Shariah-based banks previously linked to the S Alam Group, including Islami Bank Bangladesh PLC, staged protests in Dhaka’s Motijheel.
A significant number of the demonstrators reportedly travelled from the Patiya and Satkania areas of Chattogram to gather outside the Islami Bank headquarters.
There, protesters denounced the newly restructured bank boards as “illegal” and demanded their immediate dissolution. Demonstrators invoked provisions of Bangladesh’s amended Bank Resolution Act, arguing that the legislation leaves room for former owners to reclaim control of troubled or merged banks.
Mohammad Enam, the BNP lawmaker representing Patiya, acknowledged that many of the dismissed workers were from his constituency.
He told TIMES of Bangladesh that he had discussed the matter with different levels of the government because most of them are from his area and are suffering financially after losing their jobs. However, despite raising these concerns, he noted that there is still no assurance regarding their reinstatement.
Facing a major setback when the courts rejected their petitions for legal relief, the dismissed workers shifted their strategy toward political negotiations and administrative lobbying.
Touhidul Islam, a former Islami Bank branch manager involved in organising the campaign, noted that a small coordination team had been formed to maintain pressure on policymakers. He said that they had submitted memorandums to the governor of Bangladesh Bank, the finance minister, and the prime minister, but so far, they have not received any positive response.
The demonstrations quickly provoked a backlash, sparking a counter-human chain organised by ordinary depositors and a group calling itself the “Islami Bank Customer Coordination Council.” Gathering at the exact same location, these counter-protesters demanded the arrest of those responsible for what they described as “bank looting,” the confiscation of allegedly laundered assets, and the protection of the bank’s independence from corporate and political capture.
Parliament sends a clear warning
The strongest indication yet that the government intends to maintain a tough approach came during the first session of the 13th parliament.
Finance Minister Amir Khosru Mahmud Chowdhury disclosed that total defaulted loans in the country’s banking sector had surged to an unprecedented Tk5,44,831.88 crore.
More significantly, he publicly released a list of the country’s top 20 loan defaulters, more than half of which are linked directly to the S Alam Group. The disclosure came in response to a written question from NCP lawmaker Hasnat Abdullah.
Among the entities named were S Alam Super Edible Oil, S Alam Vegetable Oil, S Alam Refined Sugar, and S Alam Cold Rolled Steels, alongside several other subsidiaries of the conglomerate. Other corporate giants, including Beximco Ltd and Keya Cosmetics, also featured prominently on the list.
The finance minister told parliament that strict new measures have already been introduced under the Banking Companies Act to identify wilful defaulters and accelerate asset recovery efforts.
As part of this enforcement strategy, banks with default loan ratios exceeding 10 per cent will now face quarterly review meetings under direct legislative and administrative scrutiny. For many observers, the parliamentary disclosure carried enormous political significance, representing the first direct indication that the new government may aggressively pursue top defaulters instead of quietly negotiating their return.
Furthermore, the public statement weakened accusations from Jamaat-e-Islami lawmakers, who had previously warned that influential actors inside the administration were preparing the ground for S Alam’s rehabilitation.
Shahjahan Chowdhury, a Jamaat lawmaker from southern Chattogram, remarked that the finance minister’s statements sent a clear, necessary message. He noted that public knowledge of how the previous government manipulated institutions to hand Islami Bank over to S Alam is widespread, concluding that without strict accountability for those actions, the restoration of the rule of law remains impossible.
The law that sparked alarm
Despite the government’s increasingly aggressive rhetoric, controversy intensified after parliament passed the amended Bank Resolution Act.
Under the provisions of the revised law, former owners of distressed or merged banks may apply to Bangladesh Bank to regain ownership under specific conditions, including fulfillment of repayment obligations and strict financial restructuring requirements.
This provision immediately triggered alarm among economists, bankers, and financial reform advocates.
The Bangladesh Association of Banks warned that allowing controversial former owners back into the financial system could undermine fragile banking reforms and further damage public trust.
Currently, the government is reviewing the legislation, as international donor agencies have also raised serious objections. This international pressure is likely to further complicate S Alam’s attempts to reclaim its financial empire.
Critics argue that any pathway allowing S Alam to regain influence over financial institutions would effectively erase the accountability narrative that has dominated the country’s post-Awami League political transition.
Billions abroad become the central question
Behind the political noise and courtroom battles, a far larger issue now dominates discussions within Bangladesh’s power structure: how to recover the billions of dollars investigators believe were transferred abroad during S Alam’s years of financial dominance. Multiple senior sources familiar with ongoing discussions told TIMES any future operational flexibility for S Alam-linked businesses now depends overwhelmingly on the return of this allegedly laundered money.
Officials are reportedly exploring whether portions of these suspected offshore assets could be repatriated through tightly monitored legal channels, potentially even under foreign direct investment frameworks.
These discussions reflect a growing realization inside the government that recovering these billions may ultimately carry greater national importance than simply dismantling the conglomerate.
Currently, investigators from the Bangladesh Financial Intelligence Unit and the Anti-Corruption Commission are probing allegations that the group fraudulently obtained nearly Tk 2,25,000 crore in loans and laundered roughly $12 billion abroad through shell companies, proxy entities, and complex international financial arrangements.
This scandal is now widely considered one of the largest financial outflows in Bangladesh’s history.
Authorities believe a major portion of the money was transferred overseas between 2017 and August 2024, after S Alam established effective control over Islami Bank and several other financial institutions. Investigators estimate that companies linked to the conglomerate alone extracted between Tk 70,000 crore and Tk 87,500 crore from Islami Bank through controversial financing arrangements, amounting to more than half the bank’s total loan portfolio.
These investigations have already expanded well beyond Bangladesh’s borders. After members of the S Alam family attempted to use their Singaporean citizenship protections to challenge Bangladesh’s asset seizures by filing an international arbitration claim at the World Bank’s International Centre for Settlement of Investment Disputes (ICSID), the government escalated its legal defense.
To safeguard the state’s position against the offshore challenge, authorities approved the appointment of White & Case LLP, a leading international law firm, to represent Bangladesh in the global tribunal.
An empire operating from exile
Meanwhile, much of the once-sprawling industrial empire remains partially paralysed. Since August 2024, several S Alam-owned factories have either shut down entirely or drastically reduced their operations after founder Saiful Alam, close relatives, and senior executives reportedly left Bangladesh amid mounting investigations and political uncertainty.
A former senior executive of the conglomerate told TIMES that frozen accounts effectively crippled the group’s import operations.
He noted that while salaries initially continued despite the factory closures, the prolonged uncertainty eventually forced widespread layoffs, causing many loyal officials to leave the company voluntarily.
One major exception to this paralysis remains the 1,320-megawatt SS Power Plant in Gandamara fo Banshkhali, the largest private coal-fired power plant in Bangladesh, which is jointly owned by the S Alam Group and its Chinese partners.
Built at a cost of approximately $2.6 billion, the plant remains fully operational, with S Alam retaining its 70 per cent stake in the venture.
Sources indicate that Saiful Alam continues to coordinate parts of the conglomerate’s global business network from Singapore, while other family members operate from Canada and the United Kingdom.
Some trusted associates are also believed to remain active on the group’s behalf from Saudi Arabia.
For now, the S Alam Group stands trapped between imminent financial collapse, international investigations, political hostility, and a growing state campaign to recover what officials increasingly describe as a historic plunder of Bangladesh’s banking system.
