In a decisive move to support critical energy infrastructure, Bangladesh Bank has permitted SS Power-1 Limited, a major power generation enterprise owned by the prominent conglomerate S. Alam Group, to open import Letters of Credit (LCs) under a mandatory 100 per cent cash margin condition. State-owned Rupali Bank has been formally authorised by the regulator to facilitate these financial transactions on behalf of the massive power generation project.
The regulatory framework was formalised on Sunday, 16 August, when the Banking Regulation and Policy Department-2 of Bangladesh Bank issued two separate official directives outlining the parameters of the approval.
Under the directives, Rupali Bank is permitted to process import LCs for SS Power-1 Limited provided that the full transaction value is secured upfront by a 100 per cent cash margin. All scheduled banks operating across the nation have been instructed to align their operations with the circular when managing related financial transactions. Alongside this requirement, the central bank issued a secondary directive suspending the statutory restriction under Section 27KaKa(3) of the Bank Company Act, 1991—a clause that ordinarily restricts credit extensions under specific ownership and liability conditions. This statutory waiver will remain in effect for this specific arrangement until 31 December 2027.
Despite granting this regulatory waiver, the central bank has imposed stringent safeguards to ring-fence public funds. Bangladesh Bank explicitly clarified that no financial liability or obligation will accrue to the monetary authority regarding these credit facilities. Should liquidity pressures arise, Rupali Bank is strictly prohibited from seeking financial assistance, liquidity support, or indemnity from the central bank in connection with these import transactions.
The SS Power-1 plant, situated at Gandamara in Chattogram’s Banshkhali region, is a cornerstone of Bangladesh’s energy sector. Boasting a total generation capacity of 1,320 megawatts, the facility stands as one of the largest private sector coal-fired thermal power plants in the country.
Built with an investment exceeding 2.6 billion US dollars (equivalent to over 28,000 crore Bangladeshi Taka), the venture is operated through an international joint venture structure. S. Alam Group holds a controlling 70 per cent equity stake in the project, whilst the remaining 30 per cent interest is held jointly by Chinese engineering entities SEPCOIII Electric Power Construction Corporation and HTG Development Group.
The power installation comprises two distinct generation units, each engineered to produce 660 megawatts. Experimental electricity supply from the first unit started on 24 May 2022, followed by test transmission from the second unit on 28 June 2022. The entire plant was officially synchronised with the national power grid on 14 January 2023, supplying crucial base-load capacity to strengthen grid stability and meet growing electricity demand across the southern region.
