BB okays further rescheduling of restructured large loans

The board of Bangladesh Bank has approved a proposal for further rescheduling of restructured large loans for up to another 12 years.

Borrowers – who maintained regular payment complying with all terms and conditions of the large loan restructured policy – will be entitled to get the extended facility, according to the decision made in a board meeting on Tuesday at the Bangladesh Bank head office in Dhaka.

Moreover, only the demand loan portion of the restructured loan will be allowed to be rescheduled, said a senior executive of the central bank who attended the meeting. Demand loan is a type of short-term loan.

A total of 11 large borrowers – having loans above Tk500 crore – restructured their total loans amounting to Tk15,000 crore at a compromised down payment of 2 percent, with a tenure of 10 years under the special large loan restructured package offered in 2015.

The restructure policy was a one-time benefit on the condition that if the firms fail, the banks will take legal actions. But the central bank extended the facility by overruling the previous policy.

Of the 11 borrowers, five already defaulted for failing to continue their instalment payment.

One group failed to pay but kept its status regular through a stay order from the High Court. Another two groups failed two instalments as of March this year.

Though failure to pay two consecutive instalments will be considered as defaulting on the loan, the respective banks did not mark the borrowers as defaulters.

The remaining three groups – which were regular in their payments – have stopped recently, reveals data from the central bank.