Cash-strapped Biman Bangladesh Airlines (BG, Dhaka) is having to dig deep to meet instalment payments due on two B787s following the depreciation of the Bangladeshi taka against the US dollar. The taka, which operates under a managed floating regime, has experienced a series of sharp devaluations since May owing to a shortage of hard currency in the country. This is likely to cost Biman an extra BDT100 million taka (USD1.05 million) in September.
According to the NewAge newspaper, state-owned Biman obtained USD315 million in loans in 2019 from the country's central bank via the state-owned Sonali Bank to help finance the purchase of two B787-9s. Both planes have since arrived in Bangladesh and are now flying for the airline.
Sonali is managing the quarterly repayments, half of which comes from Bangladesh's Ministry of Finance and the other half directly from Biman. In June, the tenth of what will be 40 quarterly payments due was successfully processed. But by then, the taka devaluation was underway and the quarterly amount due rose by BDT13.2 million (USD139,000).
Since then, the taka has further devalued by around 10%, significantly increasing the quarterly amount payable by approximately BDT100 million. In 2019, Biman was carrying net debts of approximately BDT90 billion (USD1.12 billion).
In the 12 months to June 30, 2021, Biman Bangladesh Airlines reportedly made a net profit of BDT1.58 billion (USD16.5 million), ostensibly on the back of extensive repatriation and high-yield United Nations Humanitarian Air Service charter flights.
