Trading of People's Leasing's shares to remain suspended for another 15 days

The Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange (CSE) on Wednesday decided to extend the suspension on the trading of 'People's Leasing and Financial Services' (PLFS) shares for another 15 days.

The decision was taken in the interest of general investors because PLFS is on the verge of liquidation, Golam Faruque, acting managing director of the CSE, told The Business Standard.

Earlier, trading of the ailing non-bank financial institution's shares was first closed from July 14 to 12 August. Its share trading remained suspended for 60 days in three consecutive phases. 

The suspension has again been extended for a fourth time.

Meanwhile, Bangladesh Bank (BB) has appointed Md Asaduzzaman Khan, deputy general manager of BB's financial institutions department, as the liquidator for PLFS following a High Court (HC) order.

The HC has imposed a restriction on transferring all movable and immovable properties of nine former directors and two high officials of People's Leasing. All their bank accounts have also been frozen. 

In 2014, the central bank learnt of various irregularities at PLFS. After an investigation, many of its directors were found to be involved in financial mismanagement. 

Later, BB dismissed the board of directors and formed a new one. At the same time, the central bank appointed an observer for the non-bank financial institution.

At one stage the central bank sent a letter to the finance ministry for the liquidation of People's Leasing as its financial health deteriorated badly because of loan irregularities.

On June 26 this year, the ministry gave permission to liquidate PLFS for its failure to recover from its poor financial condition.  

BB then filed a petition at the High Court seeking permission to liquidate People's Leasing.

In December last year, PLSF's total deposits were Tk2,036crore and total outstanding loans were Tk1,131crore. Their defaulted loans were Tk748crore, which was 66 percent of total loans, according to BB data. 

PLFS has been counting losses since 2015. It has not been able to repay depositor's money despite maturity of their funds because it failed to realise money from defaulter organisations.