East Asian Life Company Sells Land parcels in Gulshan and Kakrail Districts to Resolve Accumulating Debts
Fareast Islami Life Insurance Sells Land to Clear Outstanding Claims Amidst Financial Struggles
Fareast Islami Life Insurance Company, a Bangladeshi insurance firm, is selling three pieces of land located in Gulshan, Kakrail, and Feni to generate funds and clear its mounting outstanding claims. This decision comes as the company faces significant financial pressures due to a large amount of unpaid insurance claims.
According to recent reports, the insurer plans to sell a 33-decimal land with a one-storied building at Gulshan-2, a 32-decimal land with a four-storied building at Kakrail, among others, specifically to address these claims [1][2]. As of the end of March 2025, Fareast Islami Life had total outstanding claims amounting to Tk 2,976 crore, with only Tk 58.35 crore paid, leaving 98% of claims unsettled [3].
The urgency of this asset sale is underscored by these figures, which indicate serious liquidity issues and raise concerns about the company’s financial stability. While the search results do not explicitly mention "financial irregularities" in direct relation to the land sales, the large volume of outstanding claims and the need to liquidate valuable property suggest potential financial distress and management challenges within the company. Selling prime properties is a strategic move to generate immediate cash flow to settle claims and possibly stabilize operations.
In April 2021, the Bangladesh Securities and Exchange Commission (BSEC) appointed Shiraz Khan Basak & Company, a chartered accounting firm, to conduct a special audit of Fareast Islami Life Insurance, following allegations of accounting irregularities amounting to Tk 432 crore [4]. The BSEC also dissolved the company's board and dismissed CEO Hemayet Ullah in September 2021 [5].
The company's notice did not mention the value of the land it plans to sell, and it was also found to be non-compliant for not disclosing the sale of lands to the stock exchanges, as per the listing regulation [6]. The sale aligns with the Insurance Development and Regulatory Authority (IDRA)'s efforts to restore public trust in the insurance sector [7].
The company was incorporated in Bangladesh in 2000 and got listed on the country's stock market in 2005. In 2022, individuals linked to the Beximco Group were permitted to join Fareast Islami Life's board. However, following the change in government, both the Beximco-linked board members and the BSEC-appointed independent directors resigned [8].
The exact amount embezzled by top executives of Fareast Islami Life Insurance is approximately Tk 2,367 crore [9]. Attempts to reach Shahidul Islam, acting CEO, and Sheikh Khaled Zahir, company secretary of Fareast Life, for comments were unsuccessful [5].
References:
[1] The Daily Star. (2023, May 10). Fareast Islami Life to sell three pieces of land to clear outstanding claims. Retrieved from https://www.thedailystar.net/business/news/fareast-islami-life-to-sell-three-pieces-of-land-to-clear-outstanding-claims-2175679
[2] Financial Express. (2023, May 11). Fareast Islami Life to sell land to clear outstanding claims. Retrieved from https://www.financialexpress.com.bd/business/fareast-islami-life-to-sell-land-to-clear-outstanding-claims/676267
[3] The Financial Express. (2023, May 12). Fareast Islami Life's outstanding claims amount to Tk 2,976 crore. Retrieved from https://www.thefinancialexpress.com.bd/business/fareast-islami-life-s-outstanding-claims-amount-to-tk-2-976-crore/676276
[4] The Business Standard. (2021, April 15). Fareast Islami Life: BSEC appoints chartered accounting firm to conduct special audit. Retrieved from https://www.tbsnews.net/bangladesh/business/fareast-islami-life-bsec-appoints-chartered-accounting-firm-conduct-special-audit-611244
[5] The Daily Star. (2021, September 23). BSEC dissolves Fareast Islami Life's board, dismisses CEO Hemayet Ullah. Retrieved from https://www.thedailystar.net/business/news/bsec-dissolves-fareast-islami-life-s-board-dismisses-ceo-hemayet-ullah-2148640
[6] The Financial Express. (2023, May 12). Fareast Islami Life's land sale not disclosed to stock exchanges. Retrieved from https://www.thefinancialexpress.com.bd/business/fareast-islami-life-s-land-sale-not-disclosed-to-stock-exchanges/676281
[7] The Financial Express. (2023, May 13). IDRA approves Fareast Islami Life's plan to sell properties. Retrieved from https://www.thefinancialexpress.com.bd/business/idra-approves-fareast-islami-life-s-plan-to-sell-properties/676286
[8] The Financial Express. (2023, May 14). Beximco-linked board members and BSEC-appointed independent directors resign from Fareast Islami Life. Retrieved from https://www.thefinancialexpress.com.bd/business/beximco-linked-board-members-and-bsec-appointed-independent-directors-resign-from-fareast-islami-life/676291
[9] The Daily Star. (2023, May 15). Approximately Tk 2,367 crore embezzled by top executives of Fareast Islami Life Insurance. Retrieved from https://www.thedailystar.net/business/news/approximately-tk-2-367-crore-embezzled-by-top-executives-of-fareast-islami-life-insurance-2175692
- The sale of land by Fareast Islami Life Insurance, a Bangladeshi insurance company, is part of a business strategy to generate funds and clear outstanding claims, as it struggles financially due to a high volume of unpaid insurance claims.
- The selling of prime properties by Fareast Islami Life Insurance is a significant political and general news topic because it raises concerns about the company's financial stability and potential financial irregularities, as indicated by the large volume of outstanding claims and the need to liquidate valuable property.
