HC questions legality of BB circular giving facilities to loan defaulters

The High Court has issued a rule asking authorities concerned to explain within 10 days why the Bangladesh Bank circular providing special privileges to loan defaulters should not be declared illegal.

The bench of Justice JBM Hasan and Justice Khairul Alam issued the order on Tuesday during a hearing on a supplementary petition in this regard, reports UNB.

Advocate Manzill Murshid stood for the petitioner, Advocate Muniruzzaman for Bangladesh Bank while Attorney General Mahbubey Alam represented the state.

The court fixed July 31 for the next hearing, said Murshid.

On February 13, the court ordered the central bank to provide a list of loan defaulters within four weeks after hearing a writ petition filed by Human Rights and Peace for Bangladesh (HRPB).

Meanwhile, Bangladesh Bank issued a special policy on May 16 for loan re-schedule and one-time payment, providing big opportunities for loan defaulters.

They were allowed to re-schedule loans after paying 2 per cent of their previous loans and then their interest rate will be 9 per cent.

Besides, defaulters were given a chance to pay the rest of their loans in 10 years and they can also avail themselves of more loans from the bank.

Later on May 21, a High Court bench ordered freezing Bangladesh Bank's policy after a petition of HRPB.

The Appellate Division stayed the High Court Division order for two months on July 8 after the Finance Ministry moved it.

The apex court also ordered that the loan defaulters will not be able to take new loans while the bench led by Justice JBM Hasan ordered to dispose the rule.