IPDC Finance’s Financial Health Continues to Deteriorate

Comparative Financial Overview over Eight Years

In 2017, earnings per share (EPS) stood at Tk 1.85; by 2024, it had fallen to Tk 0.93.
Non-performing loans (NPLs), which amounted to Tk 21 crore in 2017, surged to Tk 405 crore in 2024.
Provision coverage, which was 180 percent in 2017, dropped to 85 percent in 2024.

The financial condition of IPDC Finance PLC, one of the country’s leading non-bank financial institutions (NBFIs), has been gradually deteriorating.
Over the past eight years, the company—listed on the stock exchange—has seen significant declines in loan disbursement growth, profitability, deposits, and shareholder returns.
Meanwhile, non-performing loans have steadily increased, and the company has failed to maintain sufficient provisions against them.
Overall, IPDC’s financial indicators reflect a downward trend.

Profitability and Earnings per Share(EPS)

An analysis of IPDC Finance’s last eight years of performance shows that in 2017, its net profit after tax stood at Tk 33.54 crore, and earnings per share (EPS) were Tk 1.85.
Profit rose each year thereafter, reaching Tk 90.10 crore in 2022, when EPS stood at Tk 2.43.
However, the company’s profit plummeted in 2023, when net profit dropped to Tk 34.29 crore and EPS fell to Tk 0.92. In 2024, profit recovered slightly to Tk 36.32 crore, with EPS marginally increasing to Tk 0.93.

Equity Base and Share Capital Growth

In 2017, IPDC Finance had 18.18 crore shares, while shareholders’ equity stood at Tk 2,823.40 crore.
By 2024, the number of shares increased to 38.96 crore, and total equity rose to Tk 6,909 crore.
This indicates that the company’s capital base has strengthened over time.
However, return on equity (ROE)—which measures profit relative to shareholders’ funds—has weakened.
Between 2017 and 2022, ROE remained within the 12–14 percent range, but by 2023 and 2024 it had fallen to around 5 percent.
In other words, the company’s efficiency in generating income from its equity base has declined.

Total Assets and Return on Assets (ROA)

In 2017, total assets stood at Tk 3,928.89 crore, which grew to Tk 8,912.39 crore by 2024.
However, compared to 2023—when total assets were Tk 9,193.40 crore—IPDC’s total assets actually decreased in 2024 by about Tk 281 crore.
Return on assets (ROA), which reflects how efficiently assets are used to generate profit, remained relatively stable over the years until recently.
In 2017, ROA was 1 percent and hovered between 0.98 and 1.09 percent in subsequent years.
But since 2022, the indicator has declined sharply, falling to 0.38 percent in 2023 and 0.40 percent in 2024.
This shows that while the company’s asset base expanded, its ability to generate profit from those assets diminished.

Loan portfolio and Deposit Trends

An analysis of IPDC Finance’s loans and deposits shows that from 2017 to 2024, the company’s loan portfolio grew from Tk 3,446.70 crore to Tk 6,953.60 crore.
While loan growth was strong in the early years, it gradually slowed.
By 2024, total loans had decreased slightly from the previous year, bringing the annual growth rate down to negative 1 percent.
Non-performing loans (NPLs) rose from Tk 21.40 crore in 2017 to Tk 405 crore in 2024.
This means the NPL ratio climbed from 0.62 percent to 5.83 percent during the period.
Provision coverage—which indicates the extent of reserves held against bad loans—fell from 180 percent in 2017 to 85 percent in 2024.
Deposits increased from Tk 2,974.70 crore in 2017 to Tk 5,431.90 crore in 2024.
Overall, an analysis of IPDC’s eight-year performance shows that the company’s financial indicators were on an upward trajectory until 2021, but began deteriorating from 2022 onward.
Rising non-performing loans and unstable deposit growth have created pressure on the company’s overall financial stability.

Experts’ Insights

Dr. Al-Amin, Associate Professor of Accounting and Information Systems at the University of Dhaka, told Banijjo Protidin that public confidence tends to be higher in banks than in non-bank financial institutions.
He said, “There have been instances of fraud involving some NBFIs in the past. As a result, the general public has lost confidence in placing deposits with them.”
He further explained that NBFIs used to offer higher returns compared to banks, but when some institutions collapsed or fell into distress, it eroded public trust.
“Many institutions also failed to diversify their products,” he added.
“Moreover, only a few NBFIs are currently listed in Bangladesh Bank’s sustainability rating. This overall lack of confidence means investors now prefer banks over financial institutions.
The inability to attract general investors has been a key weakness,” Dr. Al-Amin said.
Attempts were made to contact IPDC Finance Managing Director Rizwan Dawood Shams multiple times by phone, but he did not answer.
Messages sent to his WhatsApp also went unanswered.
When reached for comment, Company Secretary and Head of Legal Affairs, as well as Acting Head of Brand and Corporate Communications, Samiul Hashim, also did not receive calls.

IPDC Finance PLC, formerly known as Industrial Promotion and Development Company of Bangladesh Limited, is the country’s first private-sector financial institution, established in 1981.
It was founded through a joint initiative involving several globally recognized organizations, including the International Finance Corporation (IFC) of the United States, Germany’s DEG (German Investment and Development Company), Switzerland’s Aga Khan Fund for Economic Development (AKFED), the United Kingdom’s Commonwealth Development Corporation (CDC), and the Government of Bangladesh.

The company was listed on the stock exchange in 2006.
Its authorized capital stands at Tk 800 crore, with a paid-up capital of Tk 409.12 crore.
IPDC distributed 12 percent and 10 percent cash dividends in 2021 and 2022 respectively, and provided 5 percent cash and bonus dividends in both 2023 and 2024.

Currently, sponsors and directors collectively hold 40 percent of the company’s shares.
The government owns 21.88 percent, institutional investors hold 21.25 percent, foreign investors 0.07 percent, and general investors 16.80 percent.