"The storm hit it (ferry) over an hour after it left Dhaka's Sadarghat ferry terminal for its destination at (southwestern) Shariatpur," Deputy Commissioner of Munshiganj district Saiful Hassan told reporters.
"The (death) toll now stands at 12," he said, adding that it was still not clear exactly how many passengers were on the MV Miraj-4 ferry but the number could range from 200 to 350 as it sank mid-river.
There are fears the death toll may rise as many more bodies are believed to be trapped inside the sunken vessel.
Shipping officials said two salvage vessels were on their way to the scene from nearby river port town of Narayanganj to locate and retrieve the sunken ferry.
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Police said fire service rescuers and local people recovered the bodies.
"The search campaign is underway," a police official told newsmen at the scene.
One of the divers involved in the rescue effort was quoted by the Daily Star as saying "many bodies" were still trapped inside the vessel.
The nor'westers, locally known as 'Kalboishakhi', often hit Bangladesh during the early summer months before the monsoon.
Ferry accidents are common in riverine Bangladesh, which is criss-crossed by some 340 rivers, particularly during the monsoon season with experts blaming poorly maintained vessels, flaws in boat design and overcrowding for most of the tragedies.
Nearly 150 people were killed in the same area in 2012 when an overloaded ferry packed with 200 passengers sank after being struck by an oil barge.