Leather sector gets spl facility to regularise defaulted loans

Staff Correspondent | Published: 23:26, Jan 07,2021

 
 

The Bangladesh Bank has floated special rescheduling facility for the leather sector entities that were relocated to Savar Leather Industrial Park, allowing the banks to regularise loans of the entities upon 2 per cent down payment by the businesses.

A BB circular issued on Wednesday in this regard on the day said that the leather entities have become defaulter due to unavoidable reasons. As a result, maintaining regular flow of credit to the sector has become impossible, thus prompting the central bank to take the measures to come up with the exit policy.

To avail the facility, the borrowers of the sector will have to apply to respective banks by March 31, 2021 upon payment of the down payment.

The entities of the leather sector that have already received loan restructure, rescheduling and interest waiver will be considered illegible to get the new exit policy.

Under the policy, the leather entities can be awarded rescheduling facility on the outstanding loans upon 2 per cent down payment by the borrowers.

The banks are allowed to waive impose interest charged on the borrowers.

For the leather business, which will not be able to continue their businesses, with outstanding loans less within Tk 5 crore will get 3 years to repay debts while the repayment tenure can be up to 5 years against the outstanding loans above Tk 5 crore.

Besides, the banks are also empowered to sell assets of the borrowers that were pledged as collateral.

For the borrowers, which will be able to continue business, will get 10 years repayment tenure including one year grace period to repay the rescheduled loan.

The interest rate on the rescheduled loans must be within 9 per cent.

In 2019, the central bank floated the same rescheduling facility for the bank defaulters in all sectors on easy terms following policy decision of the government.

The government came up with the policy with a view to bring down soaring non-performing loans in the country’s banking sector.

NPL in the country’s banking sector came down to Tk 94,440 crore at the end of September 2020 after reaching above Tk 1,16,000 crore in September 2019.

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