Dhaka, Bangladesh (BBN) – The central bank of Bangladesh may, on case to case basis, consider increasing the single borrower exposure limit only for investments in the power sector, officials said.
“We will consider re-fixation of the single borrower exposure limit only for power sector investments,” a senior official of the Bangladesh Bank (BB), the country’s central bank, told BBN in Dhaka.
He also said the BB took the move to facilitate private investments in electricity production.
The central bank has already relaxed the existing single borrower exposure limit provision for investment in power sector by the National Credit and Commerce (NCC) Bank Limited.
The NCC Bank Limited has made investments worth around US$24 million to Doreen Power Generations and Systems Limited for setting up three small power plants (SPP) at Feni, Noakhali and Tangail.
The central bank of Bangladesh earlier re-fixed the limit on large loans of single borrower exposure by 15 per cent of respective banks equity to improve risk management in the banking sector.
The single borrower exposure limit on large loans has already been reduced from 50 per cent to 35 per cent that includes 15 per cent funding facilities.
BBN/SI/SS/AD-21October08-8:37 AM (BST)