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Yesterday, the 26 businesses raised the issue at a press conference. Some of them have recently been named in cases filed by the bank to recover the funds.

The BFIU report detailed the anomalies. For instance, Total Fashion reported imports worth $195 million against exports of only $47.9 million, although rules stipulate imports for export purposes cannot exceed 90 percent of export earnings.

Despite importing raw materials from abroad, 97 percent of its back-to-back LCs were settled locally.

Total Fashion’s LC limit was Tk 59 crore, but liabilities reached Tk 345 crore.

A back-to-back LC is a secondary LC opened by an exporter against an export order from a foreign buyer. Using the export LC as a guarantee, manufacturers obtain bank financing to buy raw materials for production.

The inspection team described the transactions as unusual and suspicious, questioning whether any real exports took place.

Similarly, Dowas-Land Apparels Ltd had a loan limit of Tk 72.7 crore approved by the bank’s board in October 2022, but by August 2023 its liabilities stood at Tk 269.96 crore, including unauthorised excess loans of Tk 197.26 crore.

Such lending beyond limits created the Tk 3,081 crore liabilities across 43 companies at the branch, according to the findings.

BANK OFFICIALS BLAMED

At the Economic Reporters’ Forum yesterday, the 26 exporters alleged collusion between officials of the bank’s local branch and head office.

The exporters are members of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

They claimed the bank officials forged IDs and contracts, settled liabilities through unauthorised foreign currency transactions, and imposed “forced loans” and “demand loans” without notice.

They said export documents were purchased at inflated exchange rates to settle fraudulent liabilities.

Among the firms are RAZ Apparels, United Knitwear, West Apparels, Doyas Land, Avanti Color Tex, Crony Apparels, Prominent Apparels, and Amana Tex.

The group demanded that the government and the Bangladesh Bank arrange a comprehensive financial audit and an impartial, high-level investigation into the irregularities by a reputed audit firm in the country.

They also called for reconciliation of accounts, and measures to keep factories running to protect 25,000 jobs.

They alleged the anomalies were carried out with the help of then branch manager Md Shahid Hasan Mallik, who later lost his job.

Mohammad Hatem, president of BKMEA, told The Daily Star, “Many of our member factory owners were not aware of these loans. How were such huge amounts created in their names? Didn’t the head office know? Of course it did. And what was Bangladesh Bank doing at the time?

“Some company owners may have known but signed under compulsion. We are still not being provided with proper accounts showing the actual liabilities. That is why we are demanding an independent investigation.”

Arief Hossain Khan, executive director and spokesperson of Bangladesh Bank, said, “There is no doubt that fraud has taken place here. However, it needs to be examined whether the fraud was committed by the bank or whether the customers are now denying the loans after taking them.”

He called the case an alarming signal for the banking sector.

A senior Premier Bank official, seeking anonymity, said audits by six firms are underway and have identified Tk 4,000 crore in questionable liabilities.

The central bank has asked for detailed information on the 26 factories; five clients’ data have been submitted, with the rest pending.

Premier Bank officials admitted the Narayanganj branch has become a major burden, with Tk 4,900 crore of its Tk 5,700 crore loan portfolio now defaulted.

The bank’s board, long dominated by former Awami League lawmaker HBM Iqbal and his family, stepped down in January 2025 after 26 years.

The central bank reconstituted the board in August 2025, appointing Arifur Rahman as chairman.

Arifur told The Daily Star, “As our audit found these liabilities in the names of the factory owners, we have filed cases against them accordingly. The documents bear the signatures of these garment owners, so we are claiming the funds from them.

“However, an independent audit may be conducted to determine whether there were any other fraudulent activities involved.”

He added that details would be shared after completion of the audit.