Default loans increase by over Tk5,000cr in Jan-Mar
Skip to main content
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Splash
  • Features
  • Videos
  • Long Read
  • Games
  • Epaper
  • More
    • COVID-19
    • Bangladesh
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Subscribe
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
The Business Standard
SUNDAY, MAY 29, 2022
SUNDAY, MAY 29, 2022
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Splash
  • Features
  • Videos
  • Long Read
  • Games
  • Epaper
  • More
    • COVID-19
    • Bangladesh
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Subscribe
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
Default loans increase by over Tk5,000cr in Jan-Mar

Banking

Farhad Hossain
02 June, 2021, 10:45 pm
Last modified: 02 June, 2021, 10:55 pm

Related News

  • Hong Kong seeks to revive global banking status with major summit
  • Default threat reaches Pakistan as political crisis deepens
  • Union Bank holds shariah supervisory committee meeting
  • Banks asked to track import shipments to prevent money laundering
  • Reinventing retail banking in a post-pandemic world

Default loans increase by over Tk5,000cr in Jan-Mar

At the end of March, total default loans stood at Tk94,000 crore or 8.02% of the total outstanding loans

Farhad Hossain
02 June, 2021, 10:45 pm
Last modified: 02 June, 2021, 10:55 pm
Default loans increase by over Tk5,000cr in Jan-Mar

Borrowers do not have much pressure on them at present to pay loan instalments as they are enjoying an eased repayment facility on the basis of bank-customer relationships.

Even then, the amount of defaulted loans in the country's banking sector increased by more than Tk5,000 crore in three months from January to March this year.

At the end of March this year, total default loans stood at Tk94,000 crore or 8.02% of the total outstanding loans, up from Tk88,734 crore or 7.66% of the total outstanding loans at the end of December last year, according to sources at the Bangladesh Bank.

Explaining the reason behind the increase in defaulted loans, a senior official of the central bank told The Business Standard that despite relief in paying instalments, many good clients could not repay loans due to Covid-19, which caused the slight increase in the default loans.

Because of the pandemic, repayment terms were relaxed for all types of borrowers all through last year. This year, the facility has been on offer till June for some specific sectors that too on the basis of bank-customer relationships, as per directives from the Bangladesh Bank.

In other words, if a bank thinks that a client has truly faced losses and has a good track record of repaying loans, only then the borrower will get the facility not to pay installments.

In a recent webinar arranged by The Business Standard, Ali Reza Iftekhar, chairman of the Association of Bankers Bangladesh (ABB) and managing director of Eastern Bank, said bankers are worried about the future situation when installments will have to be paid regularly.

"Businesses are in a downturn now because of Covid-19. So, the next challenge for banks is how much their customers will be able to repay loans or how the banks will recover loans from their clients."

Abul Kashem Khan, chairman of Business Initiative Leading Development (BUILD) and former president of Dhaka Chamber of Commerce and Industry, told The Business Standard, "Sales have declined due to Covid. In such a situation, increasing the amount of debts will not bring about any significant change.

"Buyer demand is now much lower when it comes to buying products or services. As a result, the products of some manufacturers are lying in the warehouse. Or even if they sell them on credit, they are not getting their money back properly. The loan installment is not going to be repaid properly in this situation."

According to him, the new budget should lay emphasis on increasing the buyer demand.

"We need to look at how to give more facilities to good clients without offering any facility to bad customers in terms of repaying loans until the demand increases. Otherwise, the amount of defaulted loans will continue to go up," he concluded.

Economy / Top News

Default loans / Banking

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • Finance projects export fall, remittance rise
    Finance projects export fall, remittance rise
  • Photo: TBS
    After 72-hour ultimatum, health directorate goes after illegal medical facilities 
  • Photo: Bloomberg
    Direct shipping now to Netherlands 

MOST VIEWED

  • HSBC and IBA award Young talents of Bangladesh with future skills 
    HSBC and IBA award Young talents of Bangladesh with future skills 
  • Photo: Courtesy
    Anwarul elected Mercantile Bank EC chair
  • Govt borrows 51% of target thru’ savings certificate sales in 9 months
    Govt borrows 51% of target thru’ savings certificate sales in 9 months
  • Banks engaged in Hajj related transactions to remain open Saturday 
    Banks engaged in Hajj related transactions to remain open Saturday 
  • Janata Bank Ltd Holds ALCO Meeting
    Janata Bank Ltd Holds ALCO Meeting
  • Bangladesh Bank GM, DGM’s designation changed
    Bangladesh Bank GM, DGM’s designation changed

Related News

  • Hong Kong seeks to revive global banking status with major summit
  • Default threat reaches Pakistan as political crisis deepens
  • Union Bank holds shariah supervisory committee meeting
  • Banks asked to track import shipments to prevent money laundering
  • Reinventing retail banking in a post-pandemic world

Features

Women voluntarily joined the peaceful procession and protested by wearing clothing of their own choice. Photo: Trishia Nashtaran

The unhealthy obsession with what women wear

2h | Panorama
Illustration: Freepik

Bangladesh is on the verge of destigmatising menstruation

6h | Features
Photo: Collected

The death of Davos?

12h | Panorama
A male Baya Weaver beating wings. Photo: Enam Ul Haque

Baya Weavers weave: ‘Must be witnessed to be fully credited’

16h | Panorama

More Videos from TBS

Attorney General's suggestion to reduce case clutter

Attorney General's suggestion to reduce case clutter

6h | Videos
Russian forces take Liman city of Ukraine

Russian forces take Liman city of Ukraine

7h | Videos
JU food prices spike, students suffer

JU food prices spike, students suffer

7h | Videos
5% tax on poultry farmers earning above Tk10 lakh

5% tax on poultry farmers earning above Tk10 lakh

7h | Videos

Most Read

1
Bangladesh Bank GM, DGM’s designation changed
Banking

Bangladesh Bank GM, DGM’s designation changed

2
Corporates go cashless…tax cut on cards
NBR

Corporates go cashless…tax cut on cards

3
Photo: Courtesy
Panorama

Misfit Technologies: A Singaporean startup rooted firmly in Bangladesh

4
British International Investment (BII) CEO Nick O’Donohoe. Illustration: TBS
Economy

BII to invest $450m in Bangladesh in 5 years

5
Representational image. Picture: Pixabay
Economy

Govt raises regulatory duty to discourage imports of 130 products

6
Photo: Collected
Industry

Spanish recycled cotton producer opens new facility in Bangladesh

The Business Standard
Top
  • Home
  • Entertainment
  • Sports
  • About Us
  • Bangladesh
  • International
  • Privacy Policy
  • Comment Policy
  • Contact Us
  • Economy
  • Sitemap
  • RSS

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - oped.tbs@gmail.com

For advertisement- sales@tbsnews.net

Copyright © 2022 THE BUSINESS STANDARD All rights reserved. Technical Partner: RSI Lab