The loan defaulters are making serious efforts to reschedule their accounts so they do not disqualify for participating in the upcoming general election, said Bangladesh Bank sources.
As per the amended Representation of the People Order (RPO), the aspirants of the parliamentary election require clearance of default loans and outstanding utility bills.
Meanwhile, Bangladesh Bank governor Dr Atiur Rahman recently instructed the Credit Information Bureau (CIB) of the central bank to prepare related data.
A senior official of CIB told Dhaka Tribune that they are “ready logistically to provide information on loan defaults by the announcement of election schedule.”
Bangladesh Bank has seen an increase in applications for loan rescheduling recently from both the state-owned and private commercial banks, said a central bank official.
“We are following regulation in approving applications,” he added.
The banks also utilised the chance of loan rescheduling before election to recover their classified loans by receiving down-payments.
“Defaulters can regularise their loans either for short time or long time if they want to take part in the election. It is a great chance for banks to recover classified loans,” said Nurul Amin, managing director of National Credit and Commerce Bank Ltd.
“It will help reduce burden of nonperforming loans in the balance sheet.”
He said they have received many applications for rescheduling big loans for past few days particularly from business people.
However, there were no such applications that used political influence, added Nurul Amin.
Echoing with the NCC Bank MD, Pubali Bank MD Helal Ahmed Chowdhury said: “Many politicians are negotiating with us to reschedule their loans.
But it’s a great opportunity for us to recover classified loans.”
According to a Bangladesh Bank circular, no default loan can be rescheduled more than three times.
The first time rescheduling is done on payment of at least 15% of overdue instalments or 10% of total default amount, whichever is lower.
In the second rescheduling, at least 30% of overdue or 20% of total default loan – whichever is lower – will have to be paid.
The third rescheduling requires payment of at least 50% of overdue instalment or 30% of the total default loan – whichever is lower.
The classified loans rose 8% to Tk567bn in the July-September period quarter from Tk523bn of the previous three months, said Bangladesh Bank data.
The classified loans are about 13% of total default loans which amount to over Tk4tn.
Of the total classified loans, four state-owned banks have Tk241bn, private commercial banks Tk223bn, specialised banks Tk87bn and foreign banks Tk14bn.
Of the state-owned banks, Agrani Bank’s classified loan stood at Tk51bn, Janata Bank Tk47bn, Rupali Bank Tk16bn and Sonali Bank Tk125bn.