Anthrax outbreak may hit credit flow to tanners
Saturday, 9 October 2010
Siddique Islam
Credit flow to tanners for the purchase of raw hides of sacrificial animals during the upcoming Eid-ul-Azha festival may be affected following Anthrax outbreak in different parts of the country.
Tanners are fearful that the repayment of current loans, provided by state-owned commercial banks (SCBs) to buy rawhide during the last year's Eid-ul-Azha festival, could hit snags as the fallout of the disease. The government had to issue the nationwide red alert following reports of Anthrax outbreak in a number of districts.
Bankers said last year, four SCBs extended over Tk 4.0 billion in loans to tanners to help them procure raw hides.
"Some parties may fail to repay their loans in time as their businesses were hurt as a result of the anthrax fallout," Bangladesh Tanners' Association Chairman Shaheen Ahmed said.
"Over 220 million square feet of leather are processed each year, more than one-third comes from the sacrificial animals," Mr. Ahmed told the FE Thursday.
The state banks, officials said, will follow the similar guideline while providing loans for the purchase of raw hide of sacrificial animals during this year's Eid-ul-Azha festival.
Only parties, who have already repaid their debts, will be eligible for fresh loans, while defaulting parties will not be entitled to fresh credits.
"We'll take the final decision on the disbursement criteria of fresh loans for purchasing raw hides of sacrificial animals after consultation with the board, the government and the central bank," Chief Executive Officer (CEO) and Managing Director of Janata Bank Limited S.M. Aminur Rahman told the FE.
Meanwhile, a meeting of the Leather Council is scheduled to be held in the commerce ministry Sunday to review the overall situation in the leather industry, a SCB senior official said.
"We'll discuss issues including loan disbursement strategy in the meeting," the SCB official said, adding that all SCBs are trying to recover their loans.
The Janata Bank Limited provided the highest Tk 1.80 billion loan last year, followed by Agrani Bank Limited, which given out Tk 1.43 billion.
The Sonali Bank Limited disbursed Tk 655 million against three parties for the purchase of hide and skin during the last Eid.
An Agrani official said the disbursement of fresh credit will be decided after the decision of the authority, although it will be contingent upon repayment record of borrowers.
The Rupali Bank Limited had lent Tk 200 million to two clients for raw hides in the last season.
On Thursday, the government withdrew the red-alert but asked the officials concerned to remain on alert to prevent the possible furtheroutbreak.
Anthrax is a highly contagious disease, usually transmitted to people through contact with meat, blood or skin of an animal that has been infected.
Credit flow to tanners for the purchase of raw hides of sacrificial animals during the upcoming Eid-ul-Azha festival may be affected following Anthrax outbreak in different parts of the country.
Tanners are fearful that the repayment of current loans, provided by state-owned commercial banks (SCBs) to buy rawhide during the last year's Eid-ul-Azha festival, could hit snags as the fallout of the disease. The government had to issue the nationwide red alert following reports of Anthrax outbreak in a number of districts.
Bankers said last year, four SCBs extended over Tk 4.0 billion in loans to tanners to help them procure raw hides.
"Some parties may fail to repay their loans in time as their businesses were hurt as a result of the anthrax fallout," Bangladesh Tanners' Association Chairman Shaheen Ahmed said.
"Over 220 million square feet of leather are processed each year, more than one-third comes from the sacrificial animals," Mr. Ahmed told the FE Thursday.
The state banks, officials said, will follow the similar guideline while providing loans for the purchase of raw hide of sacrificial animals during this year's Eid-ul-Azha festival.
Only parties, who have already repaid their debts, will be eligible for fresh loans, while defaulting parties will not be entitled to fresh credits.
"We'll take the final decision on the disbursement criteria of fresh loans for purchasing raw hides of sacrificial animals after consultation with the board, the government and the central bank," Chief Executive Officer (CEO) and Managing Director of Janata Bank Limited S.M. Aminur Rahman told the FE.
Meanwhile, a meeting of the Leather Council is scheduled to be held in the commerce ministry Sunday to review the overall situation in the leather industry, a SCB senior official said.
"We'll discuss issues including loan disbursement strategy in the meeting," the SCB official said, adding that all SCBs are trying to recover their loans.
The Janata Bank Limited provided the highest Tk 1.80 billion loan last year, followed by Agrani Bank Limited, which given out Tk 1.43 billion.
The Sonali Bank Limited disbursed Tk 655 million against three parties for the purchase of hide and skin during the last Eid.
An Agrani official said the disbursement of fresh credit will be decided after the decision of the authority, although it will be contingent upon repayment record of borrowers.
The Rupali Bank Limited had lent Tk 200 million to two clients for raw hides in the last season.
On Thursday, the government withdrew the red-alert but asked the officials concerned to remain on alert to prevent the possible furtheroutbreak.
Anthrax is a highly contagious disease, usually transmitted to people through contact with meat, blood or skin of an animal that has been infected.