Dhaka, Bangladesh (BBN) - Industrial credit disbursement recorded a significant rise by 20.55 percent in the last fiscal against that of the previous fiscal despite political uncertainty and inadequate supply of gas and power, officials said.
The disbursement of industrial term-loans rose to BDT 425.28 billion in the fiscal year 2012-13 (FY `13) from BDT 352.78 billion in the previous fiscal year, according to the central bank statistics.
"We expect the rising trend of the disbursement of term-loans to continue in the current fiscal year as the central bank is encouraging the banks and non-banking financial institutions (NBFIs) to expedite their credit flow to the productive sectors,” a senior official of the Bangladesh Bank (BB) told BBN in Dhaka on Thursday.
He also said the estimate includes disbursement of fresh credit, rescheduling of term-loans and fund release for balancing, modernization, rehabilitation and expansion (BMRE) of industrial units.
The SME sector and BMRE have contributed to increase in the flow of credit to the industrial sectors during the period under review, the central banker explained.
Bankers, however, said the energy and power, telecommunications, pharmaceuticals, textile, housing, construction and transportation sectors have received the lion's share of the credit.
Besides, some short-term import financing has been converted into term credit to avoid classification of the loan portfolios, a senior official of a leasing commercial bank said while explaining the rising trend of the term- loan.
“Most of the large entrepreneurs have maintained a ‘wait and see’ policy during the period under review for setting up new industrial units because of political unrest centring the next general election,” the banker noted.
He also said the flow of industrial term-loan would increase in the current fiscal year if the government ensured better supply of gas and electricity to the industrial units.
On the other hand, the recovery of the term-loan increased by 20.88 percent in the last fiscal as the banks and NBFIs had intensified their recovery drives in line with the central bank directives, the BB official said.
In FY`13, the industrial credit recovery stood at BDT 365.49 billion compared to BDT 302.37 billion in the previous fiscal, the BB data showed.
BBN/SSR/AD-12Sept13-9:08 pm (BST)
