Dhaka, Bangladesh (BBN)– The country’s private sector credit growth decreased slightly in August last as lower import payment obligations and availability of overseas loans at lower interest rates, bankers said.
The growth in private sector credit flow came down to 12.69 per cent in August from 12.96 per cent in July. It was 13.19 per cent in June 2015, according to the central bank latest statistics.
The total outstanding loans with the private sector came down to BDT 5781.77 billion in August 2015 from BDT 5130.83 billion in August last year.
The central bank of Bangladesh has already set the ceiling for private-sector credit growth at 14.30 per cent for the July-December period of the current fiscal year (FY), 2015-16.
“Fresh credit demand particularly for trade finance has decreased recently following lower prices of commodities including fuel oils in the global market,” a senior official of commercial bank explained.
He also said most of the corporate entities now prefer foreign currency loan from overseas sources with lower interest rates.
But senior officials of the Bangladesh Bank (BB) said the overall private sector credit growth is still at a satisfactory level if considering the foreign-currency loans, taken by the corporate entities.
Currently, outstanding total foreign-currency loans stood at around US$8.0 billion.
The outstanding amount of foreign-currency credits includes loan extended by Offshore Banking Units of local and foreign commercial banks and direct borrowing by the corporate entities through the approval by the Board of Investment (BoI).