The Thesis
Bangladesh’s first corporate green sukuk was structured as an asset-backed instrument. Four years after issuance, as December 2026 maturity approaches, the trustee has discovered that the core promise of that structure — land backing the sukuk — was never formally transferred. Beximco, the issuer, has refused to execute a mortgage deed to fix it.
This is not a liquidity crisis. It is a governance failure. And it forces a question the whole Islamic capital markets community needs to sit with: when a sukuk is marketed as “asset-backed,” what does that actually mean if the underlying assets were never legally encumbered?
What the Sukuk Was Supposed to Be
Launched in December 2021, the Beximco Green Sukuk raised Tk3,000 crore — Bangladesh’s first Sharia-compliant corporate green bond. The structure linked investor returns to the Teesta Solar Plant and the Karatoa Solar Project: two renewable energy assets meant to serve as collateral backing the instrument.
Maturity falls in December 2026. Outstanding principal: Tk2,809.24 crore across 28.03 crore units at Tk100 each. Institutional investors — banks, non-bank financial institutions, bank subsidiaries — hold 97.72% of that. This is not a retail investor problem. It is a systemic one.
What the Trustee Actually Found
The Investment Corporation of Bangladesh (ICB), serving as trustee, verified ownership documents for both project sites — 650 acres in total — and paid land taxes on 125 acres. ICB then identified 100 acres of the solar park as appropriate collateral and sent a mortgage deed to Beximco for signature.
Beximco refused, citing “legal and governance constraints.”
That refusal is the detail that matters. The Teesta Solar Plant did its job commercially: it began commercial operations in January 2023, generating Tk1,693.31 crore in revenue through October 2025, against Tk1,044 crore in periodic returns paid to sukuk holders. The plant works. The capital structure underneath it does not.
Karatoa is a separate problem: only Tk39 crore invested against a Tk308.31 crore allocation. The project remains unfinished. The land it sits on was also never mortgaged.
The Structural Problem That Was Always There
Properly structured asset-backed sukuk require the underlying assets to be legally owned or encumbered in favor of investors — not merely referenced in a prospectus. What Beximco appears to have done is issue an instrument that pointed at solar assets as backing, without completing the asset transfer that would have made “asset-backed” mean something enforceable.
ICB is now attempting to patch this retroactively: it has recommended granting a power of attorney over 650 acres at Teesta, 130 acres at Karatoa, and Beximco Textile’s six-storey building. A Bangladesh Bank high-powered committee has proposed extending the sukuk’s tenure by six years — to December 2032 — rather than forcing a principal repayment crisis at the original maturity.
The Governance Context That Makes It Harder
The sukuk situation does not exist in isolation. Salman F Rahman — Beximco Group’s vice chairman and former investment adviser to Prime Minister Sheikh Hasina — received a lifetime ban from Bangladesh’s capital market after BSEC investigated irregularities in both the sukuk and a separate Tk1,000 crore bond. His son received the same ban. The former BSEC chairman was also banned for life. Salman F Rahman is in custody.
When BSEC removed the floor price on Beximco shares on June 8, 2026, the stock fell 74% in a single session to Tk26.10. Market capitalisation shed Tk7,706 crore in a day.
The company’s financial distress — prolonged textile shutdowns, weak cash flow, incomplete Karatoa project — means the sukuk cannot be resolved through normal refinancing channels. The extension proposal is the only realistic path to avoiding a headline default.
What to Watch
The six-year extension proposed by Bangladesh Bank has not yet been formally accepted. If it passes, investors face a delay in principal repayment with no guarantee of improved asset coverage in the interim. If it fails, Bangladesh faces its first corporate sukuk default at maturity — a damaging precedent for a market trying to build Islamic capital market credibility.
The broader signal — for regulators and investors across Muslim-majority markets developing sukuk frameworks — is that asset-backed terminology in a prospectus is not a substitute for asset transfer in a legal agreement. The Beximco Green Sukuk is a live stress test of whether Bangladesh’s regulatory infrastructure can enforce what it approved. The result is still open.