Tk 850 Crore from Green Delta Insurance's Fund is Missing
Abdur Rahman Abir: Green Delta Insurance PLC, one of Bangladesh’s leading non-life insurers, has come under scrutiny over allegations of financial irregularities involving around Tk 850 crore, according to an investigation by Insurance News BD.
The investigation reviewed the insurer’s financial statements from 2007 to 2025, along with special audit reports and other documents. It identified a series of alleged accounting inconsistencies involving equity, advances, management expenses, bank loans, premium income, cash flow and asset revaluation.
Tk 368.69 Crore Equity Gap Identified
One of the major issues highlighted in the investigation is an alleged Tk 368.69 crore gap in the company’s equity calculations.
Between 2007 and 2025, Green Delta reported profits of Tk 1,007.70 crore. Of this, Tk 273.15 crore was allocated for income tax and Tk 365.91 crore was distributed as dividends, leaving a surplus of Tk 368.64 crore.
During the same period, the company took Tk 263.47 crore in bank loans, recorded Tk 146.98 crore from asset revaluation and reported Tk 225.43 crore as advances under “other” categories. Based on these figures, the investigation calculated that the increase in equity should have reached Tk 1,004.52 crore.
However, the company’s 2025 financial statements showed an equity increase of Tk 635.84 crore, leaving a difference of Tk 368.69 crore.
Accounting experts cited in the investigation questioned the treatment of revalued assets and large advances without detailed disclosure, saying such practices could raise concerns over compliance with accounting standards.
Tk 225.43 Crore Reported as ‘Other Advances’
The investigation also raised questions about Tk 225.43 crore recorded as advances under other categories without detailed information identifying the recipients or purposes of the payments.
The amount reportedly increased from Tk 15.15 crore in 2007 to Tk 225.43 crore in 2025.
Accounting experts cited in the report said advances of such a large amount would normally require clear disclosure of where and why the money was paid.
Bank Borrowing Reaches Tk 263.47 Crore
Questions were also raised over Green Delta’s increasing dependence on bank borrowing despite reporting substantial profits.
The company reportedly took its first bank loan of Tk 1.70 crore in 2008. Its total bank borrowing later increased to Tk 263.47 crore by 2025.
According to the investigation, Green Delta paid Tk 137.48 crore in interest on bank loans over 17 years. Experts cited in the report described the scale of borrowing alongside continued profitability as unusual.
Management Expenses Exceeded Regulatory Limit
Green Delta allegedly exceeded the permitted management expense limit by Tk 171.86 crore between 2007 and 2017.
The excess expenditure rose steadily over the period. It stood at Tk 1.36 crore in 2007 and increased to Tk 27.58 crore in 2017.
According to the source material, the Insurance Development and Regulatory Authority (IDRA) considers expenditure beyond the permitted limit illegal, although no punitive action was taken against the insurer over these expenses.
Following changes to the management expense regulations in 2018, the permitted limit increased by an average of around 15%, after which Green Delta no longer recorded excess expenditure under the revised framework.
Tk 53.64 Crore Difference in Equity Figures
Another inconsistency identified in the investigation concerns Green Delta’s reported equity.
Its 2018 financial statements showed equity of Tk 628.28 crore at the end of that year. However, the following year’s financial statements reportedly presented the corresponding 2018 equity figure as Tk 574.63 crore.
The difference amounted to Tk 53.64 crore.
Tk 53.57 Crore Dividend Paid From Revaluation Reserve
The investigation also questioned dividend payments made from an unrealised asset revaluation reserve.
Green Delta revalued property in 2012 and recorded a reserve of Tk 146.98 crore. According to the investigation, the company subsequently distributed Tk 53.57 crore in dividends from the reserve between 2013 and 2025 without first selling the revalued property.
The report cited international accounting principles in arguing that unrealised revaluation gains generally cannot be treated in the same way as realised profits available for dividend distribution.
Questions Raised Over Premium and Bank Account Reporting
The investigation also identified alleged discrepancies involving premium income and balances held in bank accounts.
It said certain premium income and bank balances were not fully reflected in the company’s financial statements. In one example, the investigation calculated gross premium income of Tk 385.65 crore, while Green Delta’s financial statements reported Tk 367.67 crore.
Separate discrepancies were also identified in accounts maintained with Dhaka Bank and Jamuna Bank.
A special audit report reportedly showed Tk 21.22 crore in an overdraft account at Dhaka Bank’s Mohakhali branch, compared with about Tk 23 crore reported in the financial statements.
Meanwhile, an account at Jamuna Bank’s Dhanmondi branch reportedly contained Tk 77.02 crore, while the financial statements showed Tk 55.02 crore, leaving a Tk 22 crore difference.
The investigation further identified a Tk 13.49 crore discrepancy in the company’s 2017 cash-flow statement.
Special Audits Limited over 19-Year Period
The investigation also raised concerns about regulatory oversight.
According to the documents reviewed, Green Delta underwent special audits covering only around two and a half years of activity during the 19-year period examined.
IDRA appointed a special auditor in 2016 to review the period from 2009 to 2014. However, the audit was suspended following an instruction from then finance minister Abul Maal Abdul Muhith, according to a letter cited in the investigation.
Further special audits were commissioned in 2022 and 2024.
The investigation said auditors faced difficulties obtaining information from Green Delta. During the 2024 special audit, the company allegedly did not provide 45 categories of information requested by the audit firm.
Investigation Team Recommended Punitive Action
IDRA formed a two-member investigation committee in July 2022 following a complaint from the head of Green Delta’s Badda branch.
According to the investigation report, the committee requested 10 categories of information from the insurer but did not receive most of them.
Based on the information it was able to review, the committee reportedly found evidence involving business conducted on credit, policies issued below permitted premium rates, unlawful commission payments and failure to provide information to the regulator.
The committee recommended punitive measures against Green Delta for regulatory violations. However, following a hearing in November 2022, IDRA decided to issue a warning instead.
Green Delta and IDRA Did Not Provide Formal Responses
Insurance News BD said it made several attempts to obtain comments from Green Delta Insurance Chief Executive Officer Farzanah Chowdhury by phone and WhatsApp but received no response.
The company’s head office later advised the news outlet to submit written questions by email. According to the investigation, no formal response was received after the questions were sent.
IDRA spokesperson Saifunnahar Sumi was also contacted. Following her information, written questions were submitted to the regulator’s chairman, but the report said no formal response was received.
Financial Reporting Council executive director Md Tareq Kamal FCA told Insurance News BD that companies cannot conceal information or present inconsistencies in their financial statements.
He added that violations of international accounting standards in financial reporting could result in legal action against both the company concerned and its auditor under the Financial Reporting Act, 2015.
The allegations outlined in the investigation remain allegations based on its analysis of financial statements, audit reports and other documents. Green Delta Insurance had not provided its response to the specific allegations, according to the source material.
