The board of the Bangladesh Bank on Thursday turned down a proposal for further restructuring of large loans, closing the door to such a facility for borrowers having loans over Tk500 crore.
In 2015, the central bank offered the restructuring opportunity to big borrowers, especially those in trouble, with a condition that if they fail to pay two instalments in a row, they will be marked as defaulters and will be sued.
Borrowers, who maintained regular payments complying with all terms and conditions of the special large loan restructuring policy, enjoyed a one-time rescheduling benefit for term loans and working capital.
But many borrowers failed to continue instalment payments even after having availed this facility. So, they recently placed another proposal to the central bank for further restructuring of their loans, but now they were rejected.
However, the central bank recently allowed Janata Bank to regularise default loans of 17 entities under AnonTex Group, relaxing its own rescheduling policy.
A defaulter needs to pay down payment between 10% and 50% of default loans to restructure their nonperforming loans as per the Bangladesh Bank policy.
But AnonTex Group will pay only Tk86 crore in down payments for its Tk3,564 crore loans – much lower than the actual requirement in line with the policy.
Seeking anonymity, a central bank official said the AnonTex Group got the facility under the special large loan restructuring facility, which it did not avail earlier.
In its board meeting, the Bangladesh Bank also decided not to reconsider applications of state-owned Agrani Bank and Rupali Bank that sought exemptions from penalties awarded to them for concealing credit information of their clients in their CIB reports.
Bangladesh Bank Governor Fazle Kabir presided over the board meeting, attended by other high officials.
The central bank also did not give approval to the proposed People's Bank to start its operation as it failed to manage required paid-up capital by 31 December, said Md Serajul Islam, spokesperson and an executive director of the Bangladesh Bank.
The proposed bank has failed to secure the final licence even three years into the issuance of consent from the central bank.