The Financial Express

Accept no applications for loan rescheduling, BB asks banks

| Updated: October 31, 2019 18:09:22

Representational image Representational image

The Anti-Corruption Commission (ACC) on Wednesday submitted a new written statement to the High Court during the hearing on a case filed challenging a central bank circular.

The circular allowed defaulters to reschedule their loans with a repayment period for 10 years and get further loans.

Now the ACC says the formation of an inquiry committee is a matter of policy decision of the government which is contradictory to its first statement submitted to the HC.

"Whether or not a commission will be formed under the Commissions of Inquiry Act, 1956 is a matter of policy decision of the government. It is completely a government prerogative to decide on this issue as and when it deems fit and proper," the new statement reads.

But in the first statement submitted by it on Monday, the ACC said, "Formation of an ad-hoc 'Banking Inquiry Commission' under Section 3 of the Commissions of Inquiry Act, 1956 will help all concerned to find out the core problems prevailing in the 'Banking and Financial Sector' at present and it will, in turn, also help the ACC to play an effective role in eradicating corruption in the 'Banking and Financial Sector."

"It is crystal clear from the prevailing circumstances that there is a serious problem somewhere within the system and the regulatory regime has failed to build a reliable flawless system, it is the right time for formation of an independent Commission of inquiry for the 'Banking and Financial Sector' in order to ascertain the real problems within the system and make recommendations for the authorities under the law to implement," the statement added.

However, the ACC on Tuesday changed its lawyer to deal with the case.

Advocate Khurshid Alam appeared in the court on behalf of the ACC.

Later, the HC bench of Justice J B M Hassan and Justice Md Khairul Alam adjourned the hearing till Thursday.

Meanwhile, the central bank has barred scheduled banks from receiving any fresh applications from defaulters to reschedule their loans by paying 2.0 per cent down payment after the October 20 deadline.

But the banks can act on applications, received by the deadline, until November 19 or disposal of the writ petition, whichever comes first.

The central bank issued the orders in a circular on Wednesday conveying the scheduled banks the recent High Court orders in this connection.

"We've issued the circular in line with the High Court orders," a senior official of the Bangladesh Bank (BB) told the FE.

He also said the banks were asked not to provide fresh loans to the defaulters for the next one month or until disposal of the writ petition, as stated in the court order.


Share if you like