BB turns down Janata Bank’s plea to offset Tk 27cr loss at Italian arm

Central bank to review Janata Exchange’s performance by mid-2026 before taking a final call

Oct 13, 2025 2 min read

The Bangladesh Bank has rejected Janata Bank PLC’s request to adjust around Tk 27 crore in accumulated losses of its Italian subsidiary, Janata Exchange Company (JEC) SRL, by dissolving the state-run lender’s maintained provision.

In a recent letter to Janata Bank’s managing director, the central bank said it would reassess the subsidiary’s operations after June 2026, based on its ability to return to profitability, before considering any adjustment or provision-related measures.

The scam-hit bank had sought regulatory approval to offset €1.96 million (Tk 27.66 crore) in total losses incurred between 2021 and 2024, but the central bank declined, saying the proposal could not be approved at this stage.

Subsidiary struggles to recover from years of losses

JEC, which began operations in Rome in 2002 and later opened a branch in Milan, had been profitable until 2008 but has failed to report a profit since 2009.

In 2024, the subsidiary posted a €495,023 loss, following a €509,083 loss in 2023. Company data shows JEC spent €810,029 on salaries, social security, retirement provisions, and administrative expenses last year, while earning only €363,682 from commission income and other operations.

Janata Bank earlier closed another overseas entity, Janata Exchange Company Inc. (JECI) in the United States, in November 2021, after auditors detected financial irregularities worth $603,947 (Tk 5.13 crore) in early 2020.

When contacted, Md Mazibur Rahman, managing director of Janata Bank, declined to comment on the issue.

Wider trend of overseas pullbacks

Janata Bank is not alone in facing foreign losses. In 2022, Sonali Bank (UK) Ltd, the London-based subsidiary of Sonali Bank, also ceased operations.

Currently, around 20 Bangladeshi state-owned and private commercial banks operate branches, exchange houses, and subsidiaries across 22 countries. However, several are scaling back or shutting down overseas units amid persistent losses.

Industry insiders blame high operational costs, limited market research, competition from hundi networks, and lagging technology investment for the declining performance of Bangladeshi banks’ foreign exchange houses.