The Bangladesh Bank (BB) on Tuesday eased conditions on single borrower and large loan exposure limits to extend its support industrial growth and ensure competitive financing.
In case of credit facilities, provided to the government or against government guarantees, and against guarantees provided by Multilateral Development Bank (MDB) or Export Credit Agency (ECA) having AAA rating, the restrictions will not be applicable, according to a circular issued by the central bank.
The circular will come into force immediately.
The central bank issued this directive in exercise of its power under sections-26(Kha) and 45 of the Bank Company Act 1991, as amended.
All other instructions provided in the previous circular -- issued on January 16, 2022 -- would remain unchanged.
In accordance with the previous circular regarding the matter, the central bank reduced the single borrower exposure limit to 25% of a bank's capital from 35% -- as part of its measures to contain the concentration of loans among a small group of people.
Although the total limit, including funded and non-funded ones, was reduced to 25%, the funded loan portion was kept unchanged at 15% of a bank's capital.
The central bank also withdrew the extra non-funded borrowing limit for exporters, according to the previous circular.
