Dhaka, Bangladesh (BBN)- The central bank of Bangladesh has asked ten commercial banks to recover their classified loans by 25 per cent by June 30 this year.
The banks have also been asked to inform the central bank within next ten days the steps taken by them, officials said.
In ten banks out of 47, the top-20 defaulters' loans significantly increased in the last quarter of 2012 compared to the previous quarter.
In the October-December quarter of 2012, the top-20 defaulters' loans in the ten banks marked an increase by BDT 10.38 billion over the July-September quarter of 2012.
A segment of influential borrowers, wielding political and other forms of power, had managed to get loans from the state-owned commercial banks (SCBs) and private commercial bank (PCBs) without proper scrutiny of their cases. As a result, a hefty chunk of such loans became classified and was now difficult to recover from borrowers.
Besides, industrialists, businessmen and entrepreneurs, after taking loans from the banks, cannot service their repayment obligations due to both exogenous and endogenous financial and other difficulties, officials and bankers said.
The top-20 defaulters' loans increased by 29.17 percent or BDT 2.76 billion in private commercial banks in October-December period over that of July-September.
While defaulters' loans increased by BDT 2.34 billion or 16.83 percent in Janata Bank, BDT 1.82 billion or 7.55 percent in Agrani Bank and BDT 604.3 million or 20.95 percent in Bangladesh Krishi Bank. The state-owned Sonali Bank's top-20 defaulting loans decreased by Tk 1.40 billion in December last, official figures showed.
Classified loans, especially the top-20 defaulters' loans of private commercial banks, witnessed a declining trend due mainly to massive writing off of their classified loans and rescheduling in the last quarter of 2012. But the private commercial banks could not collect the amounts in cash from the top defaulters against their classified loans.
BBN/SSR/AD-06Mar13-8:10 am (BST)
