Written by The Banking Post
Premier Leasing & Finance has reported a record annual loss of Tk 3.66 billion for 2024, as mounting non-performing loans (NPLs) continue to erode its earnings and capital base.
With this, the non-bank financial institution’s cumulative losses over the past five years (2020–2024) have ballooned to Tk 12 billion, according to disclosures made after its board approved the audited accounts for 2024 on Thursday. No dividend was declared due to the staggering losses.
The company attributed the sustained erosion to “substantial provisions” against bad loans. More than 90% of its loan portfolio has turned toxic, leaving it unable to generate interest income while provisions for defaults keep piling up.
Prolonged Crisis in Fundamentals
Once considered a stable player in the leasing and finance industry, Premier Leasing has been in continuous losses for the past five years, weighed down by:
- Negative net interest margin
- High classified loans
- Negative capital adequacy ratio
- Excess liabilities and liquidity crisis
The company’s troubles, insiders said, stemmed from loan disbursement irregularities and weak management since 2018, reversing years of profitability.
Auditors have repeatedly raised concerns about its ability to continue operations. In the 2023 audit, the firm’s external auditor flagged “material uncertainty” over its future, as all key financial indicators turned negative.
Key Financial Indicators
- Net operating cash flow per share (NOCFPS): Tk 22.92 in 2024, down from Tk 26.41 in 2023.
- Net asset value (NAV) per share: Negative Tk 74.36 in 2024, compared to negative Tk 46.79 in 2023.
Despite approving the audited statements, Premier Leasing has yet to disclose full details of its 2024 financial performance, including interest income and expenses.
Market insiders say the company now faces a daunting recovery challenge, with its asset quality severely deteriorated and its capital base deeply eroded.
