The central bank has asked four state-owned commercial banks (SoCBs) for taking effective measures so that rescheduled loans do not turn into classified ones, officials said Sunday.
The instruction came at a meeting held at the Bangladesh Bank (BB) to review the memoranda of understanding (MoUs) of the four SoCBs --- Sonali Bank, Janata Bank, Agrani Bank and Rupali Bank --- with BB Deputy Governor Abu Hena Mohammad Razee Hassan in the chair.
The SoCBs have been instructed to gear up their recovery drives to ensure realisation of instalments of rescheduled loans properly.
The BB's instructions came against the backdrop of a substantial amount of loan rescheduled by the SoCBs taking advantage of loan rescheduling policy relaxation.
On December 23 last year, the central bank relaxed the loan rescheduling policy for the next six months to facilitate financing for the businesses, affected by political unrest.
Excepting the Rupali Bank Limited, all other three SoCBs' chief executive officers (CEOs)-cum-managing directors (MDs) were present at the meeting, while a deputy managing director of Rupali Bank attended it.
The central bank earlier signed the MoUs with the managements of the SoCBs to improve their financial performance by providing policy support.
"We've also asked the SoCBs to maintain loan growth ceiling properly," BB Deputy Governor Abu Hena Mohammad Razee Hassan told the FE after the meeting.
The central bank has already revised loan growth ceiling for the SoCBs for 2014 considering their overall performances.
The BB has re-fixed the loan growth ceiling for Sonali and Janata at 6.0 per cent and 10 per cent respectively, down from 8.0 per cent and 12 per cent in 2013.
While Agrani's loan growth ceiling stayed at the same level of last year at 10 per cent, Rupali's increased to 12 per cent for 2014 from 10 per cent in the previous year.
"We've also instructed the SoCBs for taking necessary measures to properly implement the existing core risk guidelines to minimise their financial risks," the BB deputy governor noted.
The central bank earlier identified six core risk areas in the country's banking sector. The risk factors are: credit, asset and liability, foreign exchange, information technology, internal control and compliance, and money laundering.
At the same meeting, the BB also instructed the SoCBs to improve internal control through strengthening their own monitoring and supervisions to check fraud and forgeries, according to another BB official.
The meeting also reviewed various issues, including the position of default loans, liquidity situation, credit growth, operating expenses and cost of funds, the central banker added.
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