Securing loans worth hundreds of crores from National Bank was as effortless as snapping of fingers for Manha Precast Technology Limited, a company that apparently existed only on paper. It had no office or factories, yet between 2017 and 2020, it managed to bag a staggering Tk647 crore in loans.
But the story doesn’t end there.
Then, in a clever move, Manha Precast rebranded itself as Deking Smart Battery Limited, allowing it to secure even more loans. The company’s debt now stands at Tk515 crore under its new identity. The total – an eye-popping Tk1,162 crore.
A recent Bangladesh Bank inspection report, obtained by The Business Standard, has unearthed these financial gymnastics. At the heart of it lies Maisha Group, the parent company of both entities founded by the late Awami League lawmaker Aslamul Haque. Maisha Group is no stranger to controversy – it owes Tk4,000 crore to National Bank, making it one of the bank’s top defaulters. None of its loans are currently being serviced.
The central bank report paints a damning picture of how loans were approved for Manha Precast. From its hurried inception to the overnight approval of massive funding, every step reeks of irregularities.
Manha Precast Technology was born on 26 December 2017, obtaining its trade licence, tax identification number (TIN), and bank account all on the same day. With unusual alacrity, it applied for a loan on the very same day.
Manha’s share of favours seemed to go on as the National Bank-appointed surveyor also issued a valuation certificate for collateral – third-party land – that same day. This feat would be a logistical nightmare for most.
The very next day, on 27 December, National Bank’s board approved Tk250 crore in loans for the fledgling company – Tk170 crore as a term loan and Tk80 crore as working capital – all within 48 hours of the company’s formation.
On 24 December 2019, Manha Precast’s board decided to reinvent itself as Deking Smart Battery Technology. Within two days, the Registrar of the Joint Stock Companies and Firms (RJSC) approved the name change. Soon after, loans kept flowing under the new name.
The central bank report reveals why – the rebranding was designed to sidestep National Bank’s single-borrower loan limit for Maisha Group, ensuring an uninterrupted pipeline of funds.
Irregularities found by BB inspection
The Bangladesh Bank report states that despite directives to monitor project implementation progress through on-site inspections, the bank failed to comply.
The report also mentions that the bank disbursed the loan without verifying how the borrower would use the funds. Additionally, the central bank found sufficient evidence that the loan money was used to purchase land.
The central bank advised the National Bank to recall the loans disbursed to Manha Precast, citing the company’s lack of an office and inactive factory. It also recommended taking appropriate administrative action against those involved in the loan irregularities.
What company officials say
Since its establishment, the chairman of Maisha Group was the late Aslamul Haque. After his death, his wife Maksuda Haque took over the business.
When asked about the current status of Maisha Group, she told TBS, “Currently, there are no activities of Maisha Group. The operations of the group ceased immediately after Aslamul Haque’s death. None of our affiliated companies are operational.”
On the amount of bank loans in the group’s name, she said, “I am not fully aware of the exact amount of loans in Maisha Group’s name. However, we want to repay the loans using the assets we have.”
She confirmed that Manha Precast and Deking Smart Battery were indeed their companies, but she did not know the loan processes related to these two companies.
Md Touhidul Alam Khan, managing director and CEO of National Bank, told TBS, “Maisha Group is one of the top defaulting clients. We are following the legal procedures necessary according to the Banking Companies Act.”
He said, “The total loan amount owed to National Bank by Maisha Group is currently Tk3,900 crore. There were several irregularities in the process of lending to this group.
“We are conducting an audit through internal controls. Based on the audit committee’s decision, the matter is being presented to the board, and we are proceeding accordingly.”
The Bangladesh Bank inspection report states that by the end of December 2022, the total loans and advances at the National Bank amounted to Tk42,506 crore. Of this, Tk10,670 crore was defaulted, which accounts for 25.10% of the total loans.
Suspiciously swift loan process for Manha Precast
On 26 December 2017, Manha Precast reported a paid-up capital of Tk10 lakh in its RJSC filing. The names of the two directors were listed as Mansur Ali and Saki Islam Pappu.
On the same day, it proceeded to obtain a term loan of Tk236 crore and a working capital loan of Tk116 crore from the bank.
According to the land valuation certificate for the loan, the proposed pieces of land were owned by Mamatazul Haque, Messrs Maisha Property Developments Ltd, and Messrs Mahim Real Estate Ltd.
On 27 December 2017, the loan proposal was sent to the bank’s head office. The proposal indicated a project cost of Tk569 crore, of which, the branch stated, Tk216.54 crore would be provided to the client as equity.
The Bangladesh Bank inspection report questioned how the bank would distribute the Tk216.54 crore of project cost as equity.
After the term loan and working capital loan totalling Tk250 crore was approved by the bank’s board, the Dilkusha branch disbursed Tk90 crore in cash to the client through a current account the next day.
On 24 January and 5 February 2018, payments of Tk10 crore each were made through the current account. On 29 January 2018, two payment orders for Tk3 crore and Tk7 crore were issued along with an additional disbursement of Tk10 crore.
Furthermore, the term loan for this client was increased by Tk102 crore on 20 June 2018, and by another Tk103 crore on 8 May 2019, bringing the total to Tk375 crore.
Currently, the company’s working capital and term loan with the bank stand at Tk647 crore.
Name change: A tactic to secure more loans
On 26 December 2019, Manha Precast received approval to change its name to Deking Smart Battery from the RJSC.
The company’s office was registered at Seema Bloom, 7th Floor, House No 3, Road No 16, (Old-27), Dhanmondi. At the same address, National Bank’s Dilkusha branch customers, Maisha Properties and CLC Power Ltd, were also located.
This reporter visited the address listed for the company at Seema Bloom. When security guards and several business owners were asked about the building, they said a sign board for Deking Smart Battery had been displayed there about two years ago.
However, the company is no longer operating at that location, and its activities ceased around two years back, they said.
The loan approval for the new entity was also approved and disbursed swiftly by the bank’s Dilkusha and Gulshan branches.
The Bangladesh Bank report states that although Tk130 crore was approved for civil construction work on the project with instructions to allocate the funds for factory construction, the full amount was disbursed between 9 February 2020 and 18 February 2020 without any inspection. The funds were transferred to the current account, and within a day, the money was withdrawn in cash.
However, the central bank’s inspection found no evidence of the proposed factory’s construction, nor any sign of smart battery and hybrid battery production at the facility.
In February 2020, the term loan limit for this client was increased from Tk226 crore to Tk251 crore, with an additional Tk25 crore approved. Although the client had applied for Tk25 crore, the Gulshan corporate branch approved Tk50 crore. By the end of December 2023, the loan amount reached Tk515 crore.
The central bank’s report indicates significant irregularities in the loan disbursement and approval process.
Maisha Group’s default loans at National Bank
The central bank has obtained information on several shell companies linked to the late Awami League politician Aslamul Haque, founder of Maisha Group, through which a substantial amount of loans have been taken from the bank.
According to data from Bangladesh Bank and lending banks, the National Bank has a loan of Tk1,570 crore for CLC Power Company Limited, a rental power plant located in Keraniganj near Dhaka, which was owned by the Aslamul Haque.
There are loans of Tk378 crore in the name of Dhaka North Power Utility Company Limited and Tk79 crore in the name of Dhaka West Power Limited, both entities under the same group.
Additionally, a loan of Tk656 crore is linked to the real estate company Maisha Property Development Limited.
National Bank also provided loans of Tk380 crore for Mahim Real Estate Limited and Tk11 crore for Mahim Trade Link Limited, both companies under the same group.
In total, the group’s debt to the bank amounts to nearly Tk3,074 crore, based on figures as of December 2022.
Including the loans taken by Manha Precast and Deking Smart Battery, Maisha Group’s total amount owed to National Bank is around Tk4,236 crore.
With interest, this amount is likely to have increased.
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