'The BLFCA placed several recommendations at the meeting to improve the financial health of NBFIs. The BB governor responded positively'
Bangladesh Leasing and Finance Companies Association (BLFCA) on Tuesday sought Tk10,000 crore refinancing scheme from Bangladesh Bank (BB) to salvage the ailing financial sector.
Under the proposed scheme, five-year term-loans will be extended to the NBFI which is repayable on semi-annual installment basis.
BLFCA, the forum of the managing directors of the NBFIs was holding a meeting with the BB governor Fazle Kabir at its headquarters.
"The BLFCA placed several recommendations at the meeting to improve the financial health of NBFIs. The BB governor responded positively," said BLFCA Chairman Mominul Islam.
The central bank sought a proposal to the BLFCA within seven days, elaborating how the ailing NBFI, numbering around six, could be fixed, Mominul added.
The NBFI sector had been suffering from liquidity crisis because most of the banks were withdrawing their deposits from the NBFIs, said Mominul Islam, also the managing director of IPDC Finance.
He said that the recent decision to liquidate people's leasing gave a negative signal to depositors and banks.
“This has created a confidence crisis in NBFIs regardless of their financial conditions,” Mominul said further.
On Monday, the BLFCA met with the Finance Minister AHM Mustafa Kamal and pleaded for liquidity support to help keep the sector afloat.
The interest rate of the proposed scheme should be equivalent to the six-month Treasury bill rate.
The central bank spokesman Serajul Islam said, "On Monday the BLFCA met with the finance minister and sought a rescue fund. They briefed the governor on the development."