Bangladesh Bank has imposed strict lending limits on six banks owned by the S Alam Group, requiring these institutions to seek central bank approval before issuing any loans exceeding Tk5 crore.

The central bank also mandated that overdue loans or those surpassing the credit limit cannot be renewed without cash recovery, according to a letter sent to the affected banks today (19 August).

The six banks under these new restrictions are Islami Bank Bangladesh, Social Islami Bank, First Security Islami Bank, Union Bank, Global Islami Bank, and Bangladesh Commerce Bank, confirmed Bangladesh Bank spokesperson Md Mejbahul Haque, in a statement to media.

Previously, a similar restriction was imposed on the private-sector National Bank.

This decision comes amid a severe liquidity crisis facing Islami banks, which has been exacerbated by extensive borrowing by entities affiliated with the S Alam Group.