Tk 18,000 Crore Claims Stuck In 246 Company Liquidation Cases In Bangladesh, Some Pending 10 Years

⚠ Around Tk 18,000 crore in claims is tied up in 246 company liquidation cases pending with the Bangladesh High Court, with creditors turning to winding-up petitions as a last resort to recover money owed to them. The backlog is growing as new cases continue to outpace disposals — between January and August 2026 alone, creditors filed 74 new liquidation cases involving around Tk 4,500 crore in claims, while only 13 cases involving about Tk 400 crore were disposed of, according to court data.

📊 The cases involve a wide range of creditors, including investors, customers, suppliers, employees and other businesses seeking to recover unpaid money. In some cases, customers have waited years for flats or plots they paid for, while creditors of distressed companies have struggled to recover outstanding dues. The growing backlog reflects both the deteriorating financial health of Bangladeshi companies and the inefficiency of the country''s insolvency resolution framework.

🏛 Breakdown by year of filing

The breakdown of the 246 pending cases by year of filing reveals the scale and persistence of the problem:

• 📊 2025: 56 cases filed, involving around Tk 2,500 crore in claims
• 📊 2024: 37 cases filed, involving around Tk 1,800 crore
• 📊 2023: 49 cases filed, involving around Tk 2,100 crore
• 📊 Earlier years: The remaining cases have been pending for several years, with some stretching back 10 years or more

The fact that 56 cases were filed in 2025 — the highest annual figure in recent years — suggests that corporate distress in Bangladesh is accelerating, not abating. This is consistent with broader macroeconomic indicators showing weak private sector credit growth, elevated inflation, and significant exposure of the banking sector to distressed borrowers.

👥 Why liquidation cases matter

Company liquidation cases matter because they are the legal mechanism through which creditors can recover their money from distressed companies. When a company is unable to pay its debts, creditors can file a winding-up petition with the High Court, asking the court to appoint a liquidator who will sell the company''s assets and distribute the proceeds to creditors in accordance with the priority of claims established by law.

In theory, liquidation provides an orderly process for resolving corporate distress — ensuring that creditors are treated fairly and that the company''s assets are deployed productively rather than being trapped in a failing business. In practice, however, liquidation cases in Bangladesh often take years or even decades to resolve, during which time the company''s assets may deteriorate, creditors'' claims may go unpaid, and the broader economy suffers from the misallocation of capital and resources.

🌏 Why the backlog is growing

The growing backlog of liquidation cases in Bangladesh reflects several structural weaknesses in the country''s insolvency resolution framework. First, the legal process is slow and cumbersome — with multiple court hearings, procedural requirements, and opportunities for parties to delay proceedings through technical objections. The High Court''s limited capacity to hear commercial cases adds to the delays, with cases often waiting months between hearings.

Second, Bangladesh lacks a modern, comprehensive insolvency law that provides clear timelines, streamlined procedures, and effective mechanisms for resolving corporate distress. The current legal framework — based on the Companies Act and various court rules — is designed for a different era and does not incorporate international best practice on insolvency resolution.

Third, the country lacks a professional cadre of licensed insolvency practitioners who can manage liquidation cases efficiently. The court typically appoints advocates or accountants as liquidators, but these professionals often lack the specialised skills needed to manage complex corporate resolutions, value assets, and negotiate with creditors.

Fourth, the absence of a robust corporate restructuring framework means that liquidation is often the only option for distressed companies — even in cases where the underlying business could be saved through a structured restructuring. Bangladesh has been working on a new Bankruptcy Act that would introduce modern restructuring mechanisms, but the legislation has been pending for years.

💰 Impact on Bangladesh''s investment climate

The growing backlog of liquidation cases has significant implications for Bangladesh''s investment climate. Investors — both domestic and foreign — are reluctant to commit capital to a country where they cannot be confident of recovering their money if things go wrong. The Tk 18,000 crore tied up in pending liquidation cases represents a significant drag on the economy — capital that could be deployed more productively elsewhere is instead trapped in failing companies, awaiting resolution through a slow and inefficient legal process.

The impact is particularly severe for SMEs and small creditors, who often cannot afford the legal costs of pursuing liquidation cases and end up writing off their claims. The accumulation of such write-offs over time erodes the overall health of the economy and discourages the extension of credit to businesses — contributing to the weak private sector credit growth that has been a persistent drag on the economy.

🤝 Looking ahead: reforms needed

For Bangladesh to address the growing backlog of liquidation cases, several reforms are needed. First, the country needs to enact a modern, comprehensive insolvency law that incorporates international best practice — including clear timelines for resolution, streamlined procedures for SMEs, and effective restructuring mechanisms that can save viable businesses. The proposed Bankruptcy Act, which has been pending for years, needs to be enacted and implemented as a priority.

Second, Bangladesh needs to build a professional cadre of licensed insolvency practitioners who can manage liquidation cases efficiently. This would require establishing training and certification programmes for insolvency professionals, and creating a regulatory framework to ensure that practitioners act in the best interests of all creditors.

Third, the High Court needs additional capacity to hear commercial cases — including dedicated commercial courts or benches that can specialise in insolvency and corporate restructuring cases. Without additional judicial capacity, the backlog will continue to grow regardless of improvements in the legal framework.

For Bangladesh''s broader economic development, resolving the liquidation backlog is a critical priority. The Tk 18,000 crore tied up in pending cases represents both a significant economic loss and a powerful signal that the country''s legal framework for resolving corporate distress is not working. Addressing this issue would not only free up capital for more productive uses — it would also improve the country''s investment climate and support the broader agenda of building a more efficient, resilient and dynamic private sector.