The Financial Express

BB to back double digit growth in private credit

| Updated: July 30, 2021 08:19:10

BB to back double digit growth in private credit

In a bid to continue the expansionary monetary stance, the central bank will support the double digit growth in the private sector credit flow in the current fiscal year.

While the actual private credit flow registered single digit growth in the past fiscal year (FY21), the central bank wants to push it by 11.0 per cent by the end of December and 14.80 per cent by the end of June next.

“Following the current stance of expansionary fiscal policy of the government especially for combating the Covid-19 fallout, the public, and the private sector credit growth are projected to be annually grown by 32.6 per cent and 14.8 per cent respectively at the end of June 2022,” said the new monetary policy statement.

 The annual monetary policy statement (MPS), released this afternoon in Dhaka, also mentioned that the central bank’s monetary stance, embodied in its monetary and credit policies or programmes for FY22, is designed to ‘continue ongoing expansionary and accommodative mode.’

Through the mixed-strategy, Bangladesh Bank is expecting to  support ‘continuing efforts of economic recovery process while maintaining appropriate cautions for overall price and financial stability.’

“The projection of public sector credit growth is made based on the government's expected borrowing needs from banks as envisaged in the national budget for FY22,” said the statement.

“The projection of private sector credit growth, on the other hand, has been kept unchanged given the fact that the pace of credit demand will pickup in the coming months with the expectation that the economy will reopen soon as the pandemic containment measures are underway in terms of broad based national vaccination and other health related safety programmes,” it added.

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