Dhaka, Bangladesh (BBN) – Bangladesh’s private sector credit growth fell further in November over that of the previous month mainly due to lower demand for fresh credits.
The growth in credit flow to private sector came down to 15.01 per cent in November 2016 on a year-on-year basis from 15.20 per cent a month before.
The private sector credit growth was 15.34 per cent in September 2016, according to the central bank latest statistics.
“The amount of private sector credit increased with a decreasing trend,” a senior official of the Bangladesh Bank (BB) explained.
He also said the private sector credit growth may increase in December mainly due to charging of quarterly interest on outstanding loans.
The total outstanding loans with the private sector rose to BDT 6,945.58 billion in November last from BDT 6,850.81 billion in October 2016. It was BDT 6,039.23 billion in November 2015, the BB data showed.
Talking to BBN, a senior official of a leading private commercial bank said fresh demand for credit has decreased slightly in the recent months because businesspeople were less encouraged to expand their business due to existing sluggish investment situation.
He also said the private sector credit growth may increase slightly in December but its target, set by the central bank earlier, may not be achieved.
The central bank had projected that private sector credit would grow at 16.60 per cent in December 2016 and 16.50 per cent in June 2017 respectively.
The year-on-year credit growth in the overall domestic sector, however, slightly increased to 12.14 per cent in November from 12.03 per cent in October this year.
The country’s total outstanding credit in the domestic sector stood at BDT 8189.48 billion as of November this year against BDT 7302.76 as of November 2015. It was BDT 8105.11 billion in October 2016 against BDT 7234.53 billion a year ago.