Board of Directors can give concessions and benefits to loan defaulters
Own Correspondent, Dhaka, July 19: From now on, the board of directors of the banks can decide what benefits will be given to defaulted loans. Bank owners can now decide what benefits can be given to defaulters.
Until now, the central bank's approval was required to regularize loans under special facilities. That power is now entirely in the hands of the banks.
On Monday (July 18) an instruction regarding this has been sent to the Chief Executive and Managing Director of the Scheduled Bank by the Banking Regulations and Policy Department of the Central Bank.
According to the new guidelines, Bangladesh Bank has given major concessions to defaulters in the interest of maintaining stability in the financial sector and proper management of classified loans. From now on, 2.5 to 4.5 percent deposit will be required to regularize defaulted loans. Earlier, 10 to 30 percent deposit was required to regularize defaulted loans. Earlier it took two years maximum to repay such loans, now 5 to 8 years time will be available to repay loans. Also new loans will be available.
The guidance said, 'Global economic instability is ongoing due to the long-term negative impact of Corona, the prolongation of the recent war situation in the outside world. Apart from this, new policies regarding loan rescheduling have been issued for the sake of maintaining stability in the financial sector and proper management of classified loans due to the newly increased corona infection.'
According to bank officials, even if the bank owners have the power to facilitate defaulted loans, fake, irregular and fraudulent loans cannot be regularized under the new policy. A loan can be regularized once again after four financial years. Due to the global pandemic coronavirus, the central bank gives concession on defaulted loans. Defaults have been increasing ever since this exemption was raised. Now the central bank wants to rein in the defaulted loans by discounting. If this is not done, a large part of the loan of one lakh crore rupees disbursed during the Corona period will be unpaid. A lot of that debt has now gone unpaid.