Five state-owned banks, mired in huge amounts of nonperforming loans, have received more than 3,000 applications till Sunday for defaulted loan rescheduling under a government-announced special rescheduling facility.
On the day, the High Court extended deadline for submitting application for getting loan rescheduling by one month.
A HC bench of Justice JBM Hassan and Justice Md Khairul Alam extended the time while it was hearing a public interest litigation writ petition filed by the Human Right and Peace for Bangladesh against loan rescheduling.
The bench extended the time following HRPB’s prayer as the previous one-month extension expired on Sunday.
The bench resumes the hearing today.
Under the policy, defaulters are allowed getting loan rescheduling for a period of 10 years with one year grace period with 2 per cent down payment, much lower than the usual rate.
Apart from the applications for rescheduling of defaulted loans, the banks also received applications for the same facility against the written-off loans, bankers said.
After accepting applications for rescheduling from the loan defaulters, the SoBs have been issuing approval on the loan rescheduling proposals.
Private banks have also received hundreds of applications for loan rescheduling, but the total figure could not be known immediately as the banks were tallying up the applications.
Of the state-owned banks, Sonali Bank received the highest — 1,159 applications — since the introduction of the facility on May 16 this year, as per the data available on Sunday.
Of the 1,159 applications, 1,099 applications are for defaulted loan rescheduling and the rest 60 are for written-off loan rescheduling.
Of the applications, Sonali Bank has already approved rescheduling against 84 applications involving Tk 22.90 crore under the special rescheduling policy of the Bangladesh Bank. For the rescheduling, the bank has waived Tk 32 crore in interest on the principal amount.
The 1,159 applications involve more than Tk 3,000 crore in defaulted loans.
Officials of banks, however, said that the figure might change when the data from all branches would be collected.
The special loan rescheduling policy also facilitated settlement of defaulted loans under ‘one time exit’ scheme, allowing the defaulters to enjoy interest waiver for the preceding period of rescheduling.
Janata Bank received 700 applications for rescheduling of around Tk 10,000 crore in defaulted loans.
The rescheduling proposals include the application for rescheduling of over Tk 5,500 crore in defaulted loans of AnonTex Group.
Rupali Bank received around 400 applications for rescheduling of over Tk 700 crore, BASIC Bank received 520 applications and Agrani received more than 300 applications since the introduction of the politically-motivated facility by the BB.
Of the five banks, Janata has been suffering from defaulted loans worth Tk 19,523.04 crore, which is 42.96 per cent of its outstanding loans, and Sonali has been suffering from defaulted loans worth Tk 11,892.45 crore, which is 29.46 per cent of its outstanding loans.
BASIC has been mired in defaulted loans worth Tk 8,564.51 crore, which is 56.85 per cent of its outstanding loans, Rupali has been suffering from defaulted loans worth Tk 4,229.51 crore, which is 17.25 per cent of its outstanding loans, and Agrani has been suffering from defaulted loans worth Tk 6,075.95 crore, which is 15.14 per cent of its outstanding loans.
Although the government was optimistic about the outcome of the policy, experts and bankers have warned that the policy would impact adversely on the banking sector by the way of demoralising good borrowers and encouraging good borrowers to follow the culture of non-payment of banks’ money.
The government has taken the loan rescheduling initiative with a view to reducing defaulted loans that accounted for 11.69 per cent or Tk 1,12,425 crore of the banks’ Tk 6,92,077.26 crore outstanding loans, but the policy drew huge criticisms from different quarters.
Most of the private banks have adopted a cautious strategy to deal with applications for such facility while a section of them completely refrained from entertaining the facility to their clients, officials said.
The chairman of a leading private bank told New Age that the bank would not entertain any such proposal to its customers. Even the bank may discontinue further financing if any of its clients apply for such facility, he said.
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