Dear Shareholders and Stakeholders

The year 2020 was especially challenging for IIDFC Ltd. as the economy of Bangladesh was severely impacted by COVID-19 pandemic, which in turn had negative impact on the Bank & Financial Institution Sector of the country.

Due to continuous lockdown and severe spread of COVID, we were in closed mood of the business during major period of 2020. As a result, many of the customers of IIDFC were not able to repay the loans and advances in due time. Consequently, IIDFC faced a business loss after tax of BDT 8.86 crore. Besides, as a part of five years planning of absorbing the unabsorbed provision and interest suspense, we have taken a portion of the required provision in 2020 as approved by Bangladesh Bank.  

There were also policy uncertainties as the government was pondering over implementing lending rate cap and deposit rate cap over financial and depository products. The competition in this very saturated industry along with the bearish scenario in the capital market also took their tolls.

Considering the overall economic challenges, the management of the company emphasized on consolidation rather than expansion to retain the growth attained in the previous year and also to maintain a healthy portfolio.

Now, on the backdrop of this scenario, I have the honor and pleasure to present to you the Annual Report for the year ended December 31st, 2020 along with assessment of the business climate from the perspective of both Bangladesh and the World.


The global economy is projected to grow at 6.0 percent in 2021 and 4.9 percent in 2022.The 2021 global forecast is unchanged from the April 2021 World Economic Outlook, but with offsetting revisions. Prospects for emerging market and developing economies have been marked down for 2021, especially for Emerging Asia. By contrast, the forecast for advanced economies is revised up. These revisions reflect pandemic developments and changes in policy support. The 0.5 percentage-point upgrade for 2022 derives largely from the forecast upgrade for advanced economies, particularly the United States, reflecting the anticipated legislation of additional fiscal support in the second half of 2021 and improved health metrics more broadly across the group.

Although recent vaccine approvals have raised hopes of a turnaround in the pandemic later this year, renewed waves and new variants of the virus pose concerns for the outlook. Amid exceptional uncertainty, the global economy is projected to grow at 5.5% in 2021 and 4.2% in 2022.

The global economy is climbing out from the depths to which it had plummeted during the Great Lockdown in 2020. With the COVID-19 pandemic continuing to spread, many countries have slowed reopening and some are reinstating partial lockdowns to protect susceptible populations. While recovery in China has been faster than expected, the global economy’s long ascent back to pre-pandemic levels of activity remains prone to setbacks.


Bangladesh has an impressive track record of growth and poverty reduction. It has been among the fastest growing economies in the world over the past decade, supported by a demographic dividend, strong ready-made garment (RMG) exports, and stable macroeconomic conditions. Continued recovery in exports and consumption will help growth rates pick up to 6.4 percent in fiscal year 2021-22.

Bangladesh, being one of the poorest nations at birth in 1971 with per capita GDP tenth lowest in the world, reached lower-middle-income status in 2015. It is on track to graduate from the UN’s Least Developed Countries (LDC) list in 2026. Poverty declined from 43.5 percent in 1991 to 14.3 percent in 2016, based on the international poverty line of $1.90 a day (using 2011 Purchasing Power Parity exchange rate). Moreover, human development outcomes improved along many dimensions.


Bangladesh, like other countries, faces the daunting challenge of fully recovering from the COVID-19 pandemic which has constrained economic activities and reversed some of the gains achieved in the last decade. The COVID-19 pandemic decelerated economic growth in 2020. The pace of poverty reduction slowed down, exports declined, inequality increased across several dimensions and the poverty rate in 2020 increased to 18.1 percent from 14.4 percent. Nevertheless, strong remittance inflows and a rebound in export market has helped the economy to start recovering gradually.

To recover fully and materialize its ambitious growth of achieving upper-middle income status, Bangladesh needs to address the challenge of containing COVID-19. Vaccinating the population will reduce the incidence of the disease and mortality and enable the full resumption of economic activities. Bangladesh also needs to address the challenge of creating employment opportunities through a competitive business environment, increased human capital and skilled labor force, efficient infrastructure, and a policy environment that attracts private investments.

Other development priorities include diversifying exports beyond the RMG sector; deepening the financial sector; making urbanization more sustainable and strengthening public institutions. Addressing infrastructure gaps would accelerate growth and reduce spatial disparities in opportunities across regions and within cities. Addressing vulnerability to climate change and natural disasters will help Bangladesh to continue to build resilience to future shocks.  Pivoting towards green growth would support the sustainability of development outcomes for the next generation.   

IIDFC’s Performance

IIDFC’s Revenue from interest income in 2020 was Tk. 195.15 crore compared to Tk. 249.69 crore in 2019. The net interest income after deduction of Cost of Fund experienced at Tk. 17.46 crore in 2020 compared to Tk. 72.97 crore in 2019 which indicates a decreasing trend because of pandemic situation.

The business portfolio of the company in 2020 decreased to Tk. 1,527.24 crore in 2020 from Tk. 1,890.88 crore in 2019. Company’s consolidated operating income stood at Tk. 36.34 crore at the end of 2020 from Tk. 88.84 crore in 2019. Company’s non-consolidated operating income stood at Tk. 23.05 crore in 2020 from Tk. 77.50 crore in 2019.

The NPL rate increased from 9.06% in 2019 to 23.42% in 2020. IIDFC’s Consolidated Profit before Provision and Tax was Tk. 0.27 crore in 2020 as against Tk. 51.39 crore in 2019 and Profit after tax was Tk. (8.53) crore in 2020 as against Tk. 3.49 crore in 2019 representing a reduction in profit due to COVID-19. IIDFC’s Non-Consolidated Profit before Provision and Tax was Tk. (1.86) crore in 2020 as against Tk. 49.17 crore in 2019 and Profit after tax was Tk. (8.86) crore in 2020 as against Tk. 2.62 crore in 2019.


In a particular challenging time, IIDFC Ltd. managed to persist due to prudent strategies and decisions. The matter which will significantly influence the future of the industry as well as IIDFC Ltd. is the global pandemic which has been rampaging through the earth for most part of 2020. This crisis has significantly weakened business climate and has created new impediments for all the sectors including the financial sector. We believe, this challenging time can be overcome with prudent decision making and good strategic maneuvers.

On this note, I would like to express my gratitude to our honorable chairman and respected members of the Board of Directors, for the support and guidance provided throughout the turbulent year of 2020. I would also like to thank all our stakeholders for their continuous support. Last but not the least. I would like to thank all my colleagues at IIDFC for their sincere efforts and all out supports during the year 2020.


(Md. Golam Sarwar Bhuiyan)
Managing Director