IFIC Bank: Embracing Modernity & Social Responsibility in Banking Industry

Overview

IFIC Bank PLC — formally the International Finance Investment and Commerce Bank PLC — is a first-generation private commercial bank in Bangladesh, distinguished by two features that set it apart from its peers: the Government of Bangladesh remains its single largest shareholder, and it operates one of the largest physical banking networks in the country, built largely on low-cost sub-branches. Founded on 8 October 1976 as a joint-venture investment and finance company, it was converted into a full-fledged commercial bank in 1983 and listed on the Dhaka Stock Exchange in 1986. Its head office is at IFIC Tower, 61 Purana Paltan, Dhaka.

For decades IFIC was a mid-sized, steadily profitable lender. That changed abruptly in 2024. Following the political changeover of August 2024, Bangladesh Bank reconstituted the bank's board, removed its long-serving chairman, and a subsequent reassessment exposed a volume of concealed bad loans large enough to push the bank into the biggest losses in its history: a consolidated net loss of Tk 2,560 crore in 2025, with more than three-fifths of its loan book classified as non-performing by the end of that year. The bank marked its golden jubilee in October 2026 under a new board and management whose stated programme is recovery, transparency and a return to cautious, retail-focused banking.

History

IFIC was set up at the instance of the government in 1976 as a joint venture between the Government of Bangladesh and private-sector sponsors. Its original mandate was twofold: to operate as an investment and finance company inside the country, and to establish joint-venture banks and financial institutions abroad. It began foreign-exchange business in 1980, and in 1982 it set up its first overseas joint venture, the Bank of Maldives Limited — a stake it sold to the Maldivian government a decade later.

When the government opened banking to the private sector, IFIC was converted into a full-fledged scheduled commercial bank on 24 June 1983, with industrialist Jahurul Islam as its first chairman. The overseas expansion continued: an exchange company in Oman in 1985 (today Oman Exchange LLC), branches in Karachi (1987) and Lahore (1993), a joint-venture bank in Nepal, Nepal Bangladesh Bank, in 1994, and a banking venture in Pakistan in 2003 that later became part of MCB Bank. At home, the bank grew more slowly but steadily, crossing 100 branches in 2012 and Tk 10,000 crore in deposits in 2013, and moving into its own headquarters, IFIC Tower, in 2016.

The bank's modern identity was shaped after 2017 by two things. The first was product innovation: the launch of the IFIC Aamar Account in 2017 and a "one-stop service" model in branches. The second was an aggressive expansion of sub-branches (uposhakhas) from 2019 onwards — 35 that year, about 730 by 2021, the 1,000th in November 2022 and roughly 1,200 by 2024 — which took the total network past 1,400 outlets and made IFIC, by its own account, the largest banking network in the country. Over the same period, however, control of the bank had become concentrated: businessman Salman F Rahman, an adviser to the then prime minister, chaired the bank from 2010 despite holding only about 2 percent of its shares. The consequences of that era became public only after his removal in September 2024, and they dominate the bank's recent history (see Challenges and Controversies).

Ownership and Leadership

IFIC Bank's ownership still reflects its joint-venture origins. The Government of Bangladesh, through the finance ministry, holds 32.75 percent of the bank's paid-up capital of about Tk 1,922 crore, making the state the largest single shareholder. According to Dhaka Stock Exchange data as of 30 June 2026, the remaining shares were held by institutions (21.23 percent), general retail investors (45.38 percent) and foreign investors (0.64 percent), across roughly 1.92 billion shares. Despite the state's one-third stake, directors nominated by the government have historically been a minority on the board, and for years effective control rested elsewhere — a governance weakness that Bangladesh Bank's post-2024 audits highlighted.

The current board dates from 4 September 2024, when Bangladesh Bank reconstituted it following the fall of the previous government. Md. Mehmood Husain, an independent director appointed in that reconstitution, was elected chairman on 8 September 2024 and was unanimously re-elected on 1 October 2026. Executive management is led by Syed Mansur Mustafa, appointed managing director in June 2024. Mustafa is a career banker who began at AB Bank in 1996, held senior credit positions at Trust Bank, and joined IFIC in 2015, serving as deputy managing director and, concurrently, chief credit officer, chief risk officer and head of the international division before his elevation. In October 2026 the management team was strengthened with the appointment of Imran Ahmed as additional managing director. The bank's subsidiaries include IFIC Securities Limited, IFIC Investment Limited (its merchant-banking arm, formed in 2020) and the wholly owned IFIC Money Transfer (UK) Limited.

Products and Services

IFIC offers the standard range of retail, corporate, SME and agricultural banking, but is best known for a small set of distinctive retail products built around simplicity and low entry costs.

The flagship is the IFIC Aamar Account, launched in 2017 and described by the bank as the first account of its kind in Bangladesh. It merges deposit and borrowing in a single transactional account: customers earn interest on their balance — calculated daily and paid monthly at slab-wise rates, like a savings account — while approved customers can also draw an overdraft through the same account, the same cheque book and the same card, which functions as both a debit and a credit card. A business variant, IFIC Aamar Account (Business), offers the same deposit-plus-overdraft structure to cottage, micro, small and medium enterprises and agricultural businesses. For basic financial inclusion, the IFIC Shohoj Account (2019) provides a low-cost entry-level account, paired with the Shohoj Rin loan product (2020).

In lending, the bank built an early specialisation in home loans — it states that it became the market leader in home loans in 2017 with its Amar Bari product, including smaller loans for semi-pucca houses outside the big cities — alongside personal and retail loans, SME and agricultural credit, trade finance, working-capital and project finance, syndication and treasury services for corporate clients. It issued its first VISA credit card in 2007 and had a full debit, credit and prepaid card range by 2010, and opened an offshore banking unit the same year. Since 2024 it has also offered IFIC Islamic, a full range of Shariah-compliant banking services, which it promoted further in April 2026 with the unveiling of an Islamic banking logo and dedicated Islamic service desks across its network.

Branch Network and Outreach

Physical reach is central to IFIC's model. By 2024 the bank operated more than 1,400 branches and sub-branches, and it was still describing its network in those terms at its golden jubilee in October 2026 — one of the largest banking networks in Bangladesh by number of outlets. The structure is unusual: only about 189 of the outlets were full branches as of mid-2026, while the rest are sub-branches — small, low-cost service points, often a single room with a handful of staff, placed in markets, union-level towns and neighbourhoods that conventional branches do not reach. This network carried the bank's customer base past 2.14 million in 2025 and beyond 2.5 million by October 2026, and it was the channel through which deposits recovered after the 2024 crisis. The comparatively thin ATM network is the model's acknowledged gap; the bank has said it aims to increase its ATM booths to more than 150 by the end of 2026.

Financial Performance

IFIC's published results divide sharply into a long stable period and a crisis period that began in 2024. The bank had not reported an annual loss for more than fifteen years before the changeover; for 2023 it posted a consolidated profit of about Tk 300 crore.

The deterioration since then is visible first in the balance sheet's core. Loans and advances were broadly flat — Tk 44,888 crore at the end of 2024 and Tk 44,500 crore at the end of 2025 — while deposits, after the post-August 2024 outflow, recovered to Tk 47,441 crore at the end of 2024 and Tk 51,702 crore at the end of 2025; total assets stood at Tk 59,229 crore at the end of 2025. Profitability, however, collapsed under the weight of recognised bad loans and the cost of funds. Net interest income swung from a positive Tk 273 crore in 2024 to a net interest loss of Tk 2,210 crore in 2025, as interest paid to depositors far exceeded interest earned on a loan book much of which had stopped performing. The bank recorded a consolidated net loss of Tk 121 crore for 2024 — on which no dividend could be recommended — and a consolidated net loss of Tk 2,560 crore for 2025, the worst result in its history. The losses continued into 2026: in the first quarter of 2026 the bank reported a net interest loss of Tk 777 crore and an operating loss of Tk 857 crore. Its shares, long traded on the Dhaka Stock Exchange since 1986, moved into the exchange's Z category, reserved for companies that fail to pay dividends or hold regular general meetings, reflecting the depth of the downturn.

Digital Banking

IFIC's digital build-out came in stages: a mobile banking service in 2014, the IFIC Aamar Bank internet-banking platform in 2019, and the IFIC Amar Bank mobile app in 2024. Through the platform and app, customers can view balances and statements, transfer funds within the bank and to other banks through EFT, RTGS and the National Payment Switch, pay bills and manage cards, and accounts can be opened digitally without visiting a branch. Digital channels have become an important part of the bank's recovery strategy: with lending constrained, transaction banking and low-cost deposit mobilisation through the app, internet banking and the sub-branch network are the main engines of its day-to-day business, and the bank has continued to add service points such as new ATM booths through 2026.

Challenges and Controversies

IFIC's crisis is inseparable from its governance under the previous regime. Salman F Rahman — vice-chairman of the Beximco group and private-industry adviser to ousted prime minister Sheikh Hasina — chaired the bank from 2010 to September 2024 while holding only about 2 percent of its shares. A Bangladesh Bank inspection after his removal found that more than Tk 14,500 crore had been siphoned from the bank through 28 shell and shadow companies linked to him, against which the bank held virtually no collateral; loans brokered to other politically connected business groups also defaulted. Because problem loans had been kept off the visible books, the bank reported a classified-loan ratio of just 4.5 percent in 2023. When the board installed by Bangladesh Bank on 4 September 2024 assessed the portfolio honestly, the picture inverted: by May 2025 the chairman stated that up to 38 percent of outstanding loans were classified, and by the end of December 2025 non-performing loans had reached about Tk 27,250 crore — 61.47 percent of the loan book — alongside a capital shortfall exceeding Tk 4,799 crore.

The immediate post-changeover months also brought a liquidity scare: alarmed by news about the bank's ownership, depositors withdrew funds and deposits fell from about Tk 50,000 crore to about Tk 44,000 crore before stabilising in late October 2024. Management states that the bank met the outflow from its own resources, without liquidity support from the central bank, and that over Tk 6,000 crore of deposits returned by April 2025. Even so, the structural problems remain severe: a majority-impaired loan book, negative net interest income because so much of that book earns nothing while deposits must still be paid for, a large provisioning and capital shortfall, and an audit ordered by the new board into whether loans were sanctioned properly in the earlier period. In response, lending was largely paused and then resumed cautiously from April 2025, the bank says it recovered Tk 6,006 crore of classified loans during 2025, and its stated strategy channels 60 percent of surplus funds into government securities until September 2026, with the remaining 40 percent directed to MSME and agricultural lending.

Corporate Social Responsibility

IFIC runs a conventional Bangladeshi bank CSR programme across education, health, environment and community development. In 2025, according to its annual report, it provided infrastructural support for 100 underprivileged students of the Shandeepon Welfare Society and donated a student bus to Patuakhali Science and Technology University; ran 96 health-awareness workshops with the Shakti Foundation reaching 2,226 people, and funded treatment for three critically ill individuals; organised the "IFIC Ecosolve" writing competition on environmental conservation and climate change; and supported 33 young female footballers of the Kalsindur Football Academy. It also maintained a combined child day-care centre for employees, used by more than 50 staff in 2025.

Outlook and Conclusion

IFIC Bank enters its second half-century in an unusual position: a bank with a trusted, genuinely nationwide retail franchise and a recovering deposit base, carrying one of the most damaged loan books in the country. The new board's task, as its chairman has framed it, is to bring classified loans and the provisioning shortfall down to a tolerable level over roughly two years, rebuild capital, and grow cautiously in MSMEs, agriculture and retail deposits rather than the concentrated corporate lending of the past. The bank's 49th annual general meeting approved the audited 2025 accounts in June 2026, and its golden-jubilee celebrations in October 2026 were themed, pointedly, "50 Years of Unwavering Trust". Whether that trust can be fully restored will depend less on the branch network that made IFIC distinctive than on how much of its Tk 27,250 crore in bad loans can actually be recovered — the question on which the bank's next chapter turns.