Default debts in Bangladesh’s banks balloon to Tk 1.25t

| Updated: August 12, 2022 17:22:30

Default debts in Bangladesh’s banks balloon to Tk 1.25t

Amid criticism of the Bangladesh Bank for relaxing rules for repayment and rescheduling, the authorities have reported a Tk 118.16 billion rise in the size of defaulted loans in the last quarter of 2021-22 fiscal year.

After June, the amount of defaulted debt stood at 8.96 per cent of the total loans disbursed by the banks, up from 8.53 per cent in March, reports bdnews24.com.

The default loans totalled over Tk 1.25 trillion after the end of the fiscal year, Bangladesh Bank spokesperson Serajul Islam said on Thursday. In March, defaulted loans stood over Tk 1.13 trillion.

The amount of disbursed loans stood at Tk 13.29 trillion at the end of March and it increased to around Tk 14 trillion at the end of June.

The Bangladesh Bank on Jul 18 announced a new loan rescheduling policy after nine years to “reduce the pressure on the economy”. The new policy includes an extension of the grace period for loan repayment and other time limits to ease pressure on businesses.

Defaulters will also be allowed to reschedule their non-performing loans (NPLs) four times in contrast to the previous three times.

In June, Bangladesh Bank said no companies from “major industries” will be deemed to be defaulters if they manage to repay at least half of their instalments.

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