At the end of March this year, the amount of NPLs in the banking sector stood at Tk92,510 crore, which was 9.03% of the total disbursed loans
Banks’ non-performing loans (NPLs) declined by Tk1,821 crore in three months till March this year as the central bank asked banks not to classify loans for nine months till September to help business people to combat the economic fallout of Covid-19.
At the end of March this year, the amount of NPLs in the banking sector stood at Tk92,510 crore, which was 9.03% of the total disbursed loans, according to the latest Bangladesh Bank (BB) data.
The defaulted loans in the banking sector were at Tk 94,331 crore as of December of 2019.
Bankers said that the defaulted loans in the January-March period declined because the central bank has barred banks not to downgrade any loan for the borrowers’ failure to pay installments in the January-September period this year.
No bank loan will be treated as default loan until September 30 this year, if borrowers fail to repay during the period, said a circular notice of Bangladesh Bank (BB), issued on June 15, this year.
Earlier, the similar facility was until June 30, this year.
Banks cannot impose any penalty interest or additional fees on the loans and investment during this period, the notice says further.
On April 22, this year, Bangladesh Association of Banks (BAB) requested Finance Minister AHM Mustafa Kamal and BB Governor Fazle Kabir to extend the period to December 31, 2020.
The volume of defaulted loans in the country’s banks dropped in two consecutive quarters without any significant recovery owing to the relaxed policy, said bankers.
Bankers cautioned that the situation would deteriorate further in the coming days.
As of March this year, total outstanding loans of banks stood at Tk10,24,498 crore.
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