Huge defaulted loans in SCBs to hit GDP growth: BB governor

Staff Correspondent | Published: 22:24, Feb 14,2017

 
 

Bangladesh Bank governor Fazle Kabir speaks at the inaugural ceremony of the ‘Banking Related Orientation Workshop-2017’ at the central bank headquarters in the capital Dhaka on Tuesday. — New Age photo

Bangladesh Bank governor Fazle Kabir on Tuesday said excessive defaulted loans in the state-owned commercial banks would put an obstacle in achieving expected GDP growth in the coming years.
The government will set a target of 8 per cent GDP growth in the coming fiscal years but the country would have to face a tough condition if the existing higher defaulted loans persist in the SCBs, he said while addressing as chief guest the inauguration ceremony of the ‘Banking Related Orientation Workshop-2017’ at the central bank headquarters in the capital.
‘Classified loan witnessed around 10.34 per cent as of September 30, 2016 in the banking sector. But the rate is very high in the state-owned banks. We will have to decrease the defaulted loan to achieve the expected GDP growth in the coming years,’ he said.
All economic indicators but inward remittance are performing nice in the recent months, the BB governor said.
The inward remitted declined by 16.90 per cent in the first seven months of the fiscal year 2016-17 on the basis of year-on-year, he said.
Kabir said the BB had taken various steps including conducting a diagnostic survey and to find out the causes of downtrend of the remittance inflow.
Two separated teams of the central bank have already visited Malaysia and Singapore to find out the reasons of falling trend in the inflow of remittance, he said.
The central bank has recently taken an initiative to decrease the cash-out and cash-in of the mobile financial services as it is apprehended that the remittance inflow has decreased due to using the MFS illegally to remit the money from abroad, Kabir said.
Among others, BB’s deputy governors, president and general secretary and members of the Economic Reporters Forum attended the workshop. 

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