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Special loan rescheduling: Banks asked not to allow fresh applications

  • Published at 04:08 pm October 23rd, 2019
web-bangladesh bank
Dhaka Tribune

The circular says there will be no new credit facility for the defaulted borrowers, who are the beneficiaries of the bailout scheme

The Bangladesh Bank (BB) on Wednesday asked banks to stop receiving any fresh applications from defaulted borrowers to avail the special bailout scheme on loan rescheduling and one time exit facility as the deadline expired on October 20.

On May 16 this year, the BB offered a special bailout facility for loan defaulters with 2% down payment and a long 10-year repayment facility with one-year grace period and one time exit provision with maximum interest waiver.

On Wednesday, the BB's banking regulation and policy department (BRPD) issued a circular asking all scheduled banks to comply with the latest instruction.

The circular says there will be no new credit facility for the defaulted borrowers, who are the beneficiaries of the bailout scheme.

AKM Ehsan, general manager (current charge), BRPD, told Dhaka Tribune that the BRPD's latest circular was aimed at removing  confusion, if any, over the extension of time by the high court up to November 19, 2019.

He said the confusion arose as the Supreme Court’s Appellate Division granted another extension of one month until November 19, 2019.

"The BRPD's deadline for filing application expired on October 20. To utilize the remaining time until November 19, banks will examine the applications for final approval," he said.

He said banks were advised not to receive any fresh applications. 

Besides, banks would not approve any fresh loans in favour of any beneficiaries of rescheduling facility, he added.

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