Dhaka, Bangladesh
Private banks gradually bringing down lending rate to single digit

Private banks gradually bringing down lending rate to single digit

News Desk: Like the state-owned commercials banks, private commercial banks are gradually bringing down their lending rate to single digit as per the instruction of Prime Minister Sheikh Hasina. The information was revealed on Sunday after a meeting among the high officials of Bangladesh Bank (BB) and managing directors and chief executive officers of the commercial banks at the central bank headquarters in the city. BB Governor Fazle Kabir presided over the meeting while its chief spokesman Serajul Islam and Chairman of the Association of Bankers Bangladesh (ABB) Syed Mahbubur Rahman briefed journalists about the outcome of the meeting. During the meeting, Serajul Islam said, BB high officials exchanged views with the managing directors and chief executive officers of the different scheduled banks for fixing future activities to bring down the existing lending rate to single digit and the huge amount of Non-Performing Loan (NPL) in a tolerable level. ABB Chairman Syed Mahbubur Rahman said some banks have already brought down their lending rate to single digit and the rest of the banks are trying to gradually offer the new rate. "Lending rate depends on supply and demand. If banks can deposit money by six percent interest rate, they can easily lend money at 9 percent. In this regard, the government must help the banks," he added. Mahbubur Rahman, also managing director of Dhaka Bank Limited, said the BB officials and top management of banks discussed many issues, including present situation of economy, investment, growth and NPL. "We made an elaborate discussion on NPL. We hoped that the rate of NPL will come down within 10 percent in the new July statistic of the Bangladesh Bank as the government and bankers are providing all sorts of efforts to bring down the NPL within a tolerable level," he added. Another report adds: Classified loans in Bangladesh's banking sector soared by 19.22 per cent or Tk 14,286 crore in three months as the restructured loans again became classified in absence of any measure against the wilful defaulters. As per a Bangladesh Bank data released recently , classified loans increased to Tk 88,589 crore at the end of March 2018 from Tk 74,303 crore on December 31, 2017. Earlier in the December quarter, classified loans declined to Tk 74,303 crore as of December 31, 2017 from Tk 80,307 crore on October 31, 2017 mainly due to restructure facility allowed by the central bank. As per the central bank data, 57 scheduled banks rescheduled Tk 19,120 crore in 2017. Former Bangladesh Bank governor Saleh Uddin Ahmed told New Age on Sunday, 'None payment of bank loans have become a culture in the banking sector and the classified loan has been on the rise as the wrongdoers face no punishment for this.' He said that it was very sad that the banks used to misreport on loans and misinterpret them and continued to go unpunished. He also suspected that a portion of the loans were laundered abroad as the number of wilful defaulters was on the rise.

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