Business Report :
Commercial banks now can offer special rescheduling facility for up to 10 years with a two-year grace period to borrowers whose loans are classified as of November 30.
To avail the facility, the borrowers will have to pay 2.0 per cent of their outstanding loans as down payment. But the borrowers will not be allowed to show paid loan installments or its part before submission of the application as special down payment, according to the Bangladesh Bank circular issued Monday.
The special loan-restructuring facility aimed at restoring the struggling business and financial operations of both classified and unclassified borrowers.
The central bank’s Banking Regulation and Policy Department (BRPD), says the facility comes for borrowers whose loans are classified as SS or substandard, DF (doubtful), or BL (bad/loss) as of November 30.
Regarding special loan-restructuring facility, the BB circular states that the unclassified borrowers facing problems can avail the facility up to December 31 next and the borrowers can get the facility for maximum two years of the stipulated timeline.
The central bank further eases special exit facility allowing the classified borrowers to change their loan status to unclassified after exiting through the facility.
Simultaneously, the classified borrowers through the exit policy will now get non-funded facility like the opening of letter of credits, according to the circular.
Under the new rules, the borrower must repay in quarterly instalments, and the annual repayment must not fall below 20 percent of the outstanding amount. If the borrower fails to pay the instalment for any three-month period, they will again be marked as a defaulter.
The central bank’s policy relaxation comes twelve days after the BB’s meeting with bank executives where the central bankers asked the bankers to somehow control the mounting growth of NPLs (non-performing loans) through intensifying cash-recovery drives.
Meanwhile, Bangladesh Bank has not published the banking sector’s classified loan data for the April-June quarter even five months after it ended, leaving analysts without a clear picture of the sector’s condition.
The central bank usually releases non-performing loan (NPL) figures within a month of each quarter’s end. This year, however, publication has been consistently delayed. The January-March data came out only in June, and no date has been set for the second-quarter release even though banks have already begun publishing their third quarter figures.
