Home ›› 27 Oct 2021 ›› Front
Over a dozen local and foreign banks are het up over the closure of Opex & Sinha Group’s Narayanganj operation since the move of the Asia’s largest garment and textile industry will deter the banks from realising over Tk 4,700 crore irregular loans.
The textile giant announced shut of its operation on October 19 in the wake of what it says “a huge financial loss”.
The business conglomerate owes to National Bank, Standard Bank, Pubali Bank, Dutch-Bangla Bank, Bank Asia, Mutual Trust Bank, Dhaka Bank, AB Bank, The City Bank, Trust Bank, Meghna Bank, Shahjalal Islami Bank and other state-run and foreign banks.
According to bankers, some loans have been overdue and some rescheduled amid the Covid-19 pandemic; the loan installments of Opex Group of companies are irregular now.
Half a dozen managing directors and CEOs of banks told The Business Post this is very shocking that such a big garment industry shut its operation.
The Asian giant in garment sector has been going through a rough patch for long including a large amount of debts in the banking sector, thus leading the enterprise to close down its Narayanganj operation on October 19.
A notice signed by the group’s acting director (administration) Banij Ali on October 18 came up with the announcement of permanent closure.
As per the notice, the decision about paying the wages and arrears would be made after talks with the Ministry of Labour and Employment, the BGMEA and the representatives of garment workers and other stakeholders.
Anisur Rahman Sinha, former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), established more than two dozen factories under Opex Group since 1984 and its reputation spread far and wide.
The group had garments division as well as dry and wet processing facilities, backward linkage and vertical setup, denim village and accessories factory.
At the end of June this year, its loan with Standard Bank stood at Tk 250 crore.
“The largest and old garment industry’s business loans became irregular as it fell in financial trouble,” said Standard Bank MD and CEO Khondokar Rashed Maqsood.
Similarly, the group’s loan with Pubali Bank stood at Tk 175 crore at the end of June this year.
Pubali Bank Managing Director & CEO Safiul Alam Khan Chowdhury told The Business Post the loan of the garment manufacturer has now become irregular.
“We are very concerned about the loans of the group,” he said, adding that Pubali Bank, however, has strong collateral against the debts.
Opex & Sinha Group’s outstanding loan with City Bank accounts for Tk 150 crore as of June this year.
“It was a good and reputed industrial group but now all its loans have become irregular,” a high official of the bank pointed out, seeking
anonymity.
The group outstanding loan with the Mutual Trust Bank is Tk 70 crore.
The bank Managing Director and CEO Syed Mahbubur Rahman asserted that Mr Sinha is a good industrialist but now he is in trouble because of
himself.
“He took the helm of all his business entities without delegating anything to anyone, which might be the reason behind the free fall of the group. Most of their loans have been rescheduled,” he said.
Opex Group outstanding loan with Dhaka Bank goes about Tk 60 crore till June.
According to the bank Managing Director and CEO Emranul Huq, “We are utterly shocked about the present situation of the group. Now its loan repayment is very slow.”
“The cash flow against the group investment was negative, which could be the reason behind the financial losses incurred by the company.”
The group loans with AB Bank is Tk 70 crore, Meghna Bank Tk 40 crore and Trust Bank Tk 12 crore till June.
Contacted, some senior officials of the Bangladesh Bank said they were yet to have any request from local banks on the recovery of the huge amount of unpaid loans from Opex Group.
They, however, said banks have their own mechanism to retrieve money from the business conglomerate in question.
“We have a rough estimate of above Tk 4,700 crore lying unrealised by above one dozen banks from Opex,” an executive director of the BB told The Business Post.
He, however said, the BB has been observing the development very keenly.
A number of insurance companies are also in problems in realizing their unpaid insurance money from the group, as some insurers cleared the insurance money in favour of Opex in good faith as the group had been a good client for long, sources in the insurance sector have informed The Business Post.
The state-run Agrani Bank Managing Director and CEO Mohammad Shams-Ul Islam told this correspondent that it is a very harrowing piece of news that the garment industry with around 45,000 employees is now shut.
Such a big garment factory should not be allowed to end up in the gutter, the bank official suggested, adding that the group needs help now; it faced financial while complying with the instructions of accord and alliance.
He urged all state-owned banks to come forward to save the largest garment industry in Asia through a syndicate loan.
“The problem is that others would try to fish in muddy water,” opined the banker.
Industry insiders said day by day the company’s liabilities to the banks are on the rise while its utility bills and workers’ wages remain unpaid which prompted the group management to shut its operation.
At the turn of 21st century, the group raked in $ 500 million and employed around 45,000 people. It was a time when buyers had to queue up to place orders. The group had three liaison offices in UK, US and Hong Kong.
The Opex Group insiders mentioned that reputed fashion brands of Europe and US sourced their goods from them.
Levi’s, VF, American Eagle, Nautica, JCPenney, Target, PVH, GAP, Hanes, Haggers, Perry Ellis, Sears, Oxford, Aeon (Japanese), H&M, OVS, Macy, NEXT and Oshkosh were among the top buyers.
The garment industry had over 18,000 sewing machines distributed to 300 production lines and had specialised Jacquard Sweater production unit.
It was able to produce over 2,20,000 pieces of clothing products every day.
