Bangladesh Bank (BB) is planning to reschedule the default loans of 280 institutions under its special powers, following applications from more than 1,000 institutions seeking loan restructuring.
According to BB policy, defaulting institutions cannot renew their loans simply by depositing money as per their demand.
For this reason, the central bank is offering special facilities to reschedule loans, but only for institutions with outstanding loans of more than Tk 50 crore. Earlier this year, BB formed a selection committee to identify eligible entities for the scheme.
* Defaulted loans rose to Tk 5,30,428 crore as of June, up from
Tk 4,20,334 crore (24.13%) in March
* Major beneficiaries include Energypac Group, Buildtrade Group, Vergo Media, Gazi Group, Sourav Group
So far, many of the institutions whose defaulted loans are set to be rescheduled had shut down during the previous government's tenure.
The list includes businesses linked to Bangladesh Nationalist Party (BNP) leaders, from grassroots to top levels. Some businesses suffered due to the coronavirus pandemic and the dollar crisis, while others have been accused of loan irregularities.
According to BB sources, the central bank has decided to reschedule loans worth about Tk 3,000 crore for four companies of Energypac Group. The group has already started regularising its loans with 28 banks and financial institutions.
A senior official of Energypac Power Generation said, "Our loans became bad due to the coronavirus, dollar crisis, and unpaid government bills. The government withheld our bills for six years. Now the central bank has given us a special opportunity to reschedule the loans."
Apart from Energypac, the central bank has extended facilities to reschedule Tk 4,000 crore in loans owed by Buildtrade Group, owned by Enayetur Rahman Bappi, along with loans for his other companies. It has also decided to restructure the loans of Vergo Media (Channel Nine), also owned by him. Buildtrade's loans are with AB Bank, while Vergo Media's are with Rupali Bank.
Other beneficiaries include BNP Treasurer M Rashiduzzaman Millat's Sourav Group, Rajshahi's Ershad Group, Habiganj-based businessman Arifur Rahman's Blue Planet Group (Palace Resort), Sky Capital, and Badar Spinning Mills. The list also covers Western Engineering, Bengal Group's Bengal Plastic, Abdul Monem Group, Orion Group, Deshbandhu Group, Opex Sinha, and Tanaka Group.
Gazi Group, whose operations suffered after the fall of the previous government in August last year, has also received rescheduling facilities. Others on the list include Dandy Dyeing Limited (owned by the Zia family), Rising Steel (owned by BNP leader Aslam Chowdhury), Sabab Fabrics (owned by Sylhet BNP leader Khandaker Abdul Muktadir), One Denim (owned by Gias Uddin Al Mamun), Fair Electronics, Ifad Group, Ambient Steel (BD), GPH Ispat, Prime Group, Anwar Group, Silkways Group, Tanaka Group, Diamond Spinning Mills, Meem Group (Alema Textile), SMA Group (AA Knit Spin), BUC Agro, Bling Leather Products, Apex Weaving, and Ankur Specialized Cold Storage. However, not all companies in these groups have defaulted-only certain subsidiaries. BB has written to the lending banks and financial institutions to extend rescheduling facilities to the concerned companies.
Under existing rules, a defaulted loan can be renewed with a one-time deposit of about 4.5 per cent of the outstanding amount, with a repayment grace period of up to one year and a repayment term of up to seven years. Under BB's special powers, however, defaulting firms are being given 5 to 15 years for repayment, with only a 1 per cent down payment, and in some cases, a three-year repayment break.
