Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
The Bangladesh Bank (BB) issued a circular on Monday, extending the timeframe related to the exit policy - applicable for the non-textile industries, identified as sick by the Ministry of Industries.
Under the latest revision, a sick non-textile factory - having an original loan (principal amount) of at least Tk 5.0 million - will be able to apply for availing the facility by giving a minimum of 2.5 per cent of the principal amount as down payment until June 2023.
Earlier, the timeline was within 90 days of issuance of the previous circular, issued on October 25, 2022, and a bank had to settle the applications within 45 days.
Seeking anonymity, a BB official said they raised the timeline, as many borrowers under the category showed their interest to avail the facility.
"Those who will not apply within the time will not be eligible to avail the exit facility."
Such loans should be treated as classified as long as the borrowers are fully repaying the loans.
About relaxation of cost of fund on the interest, the BB official said the respective bank can take the decision - based on the circular issued by the Finance Division on February 02, 2008.
Under the policy, a bank can give a borrower at best three years to pay off the loans in installments, according to the central bank.
However, if a bank needs to adjust the loans by selling the borrower's immovable properties, the borrower can be given a one-time chance to clear the loan within the stipulated three years' time. Last year, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) sought the prime minister's intervention to save the sick non-textile factories.
The Awami League-led government formed a high-powered taskforce in 2009 to rehabilitate the sick industries and devise mechanisms to settle their liabilities.
The taskforce divided the sick factories into three categories - garments, textiles, and non-textiles.
Later, the government issued circulars to settle the liabilities of 279 garment factories and 100 textile factories as per the recommendations of the taskforce. But no non-textile factory has availed the facility yet.