BB urges businesses to exploit reduced lending rates
Wednesday, 19 March 2008
Siddique Islam
The country's business community has been advised to avail themselves of the lower interest rates and reduced bank charges as promised by the bankers in a recent meeting with the central bank, officials said.
The Bangladesh Bank (BB) sent letters to all the chambers across the country Tuesday with the minutes of the tripartite meeting attended by BB officials, representatives of Bangladesh Association of Banks (BAB) and Association of Bankers, Bangladesh (ABB), at the central bank on March 3 last.
"We have already sent copies of the letter to 67 chamber bodies across the country to inform the bankers' commitments on the issues," a BB senior official told the FE Tuesday.
He also said the central bank expects that the business community will be benefited from the latest move.
Besides, the central bank will want to know from the commercial banks about the progress in the implementation of their commitments at a bankers meeting scheduled to be held March 27 next with the BB Governor Salehuddin Ahmed in the chair.
The private commercial banks (PCBs) have already given commitments to the central bank to lower their lending rates by more than 1.0 percentage point on lending rates and slash different bank charges.
During the meeting, the commercial bankers will inform the central bank on the measures that they have taken in compliance with the BB's instructions relating to curbing price hike of essentials in the local markets.
On March 16 last, the central bank instructed the commercial banks to charge maximum 12 per cent interest against import of powdered milk for the time being to curb the price hike of the item in the local markets.
The BB through a similar circular instructed the commercial banks on August 14, 2007 to charge interest rates at maximum 12 per cent on import of ten essential commodities including rice, wheat, sugar, edible oil, gram, lentils, pulses, onion, spices and date.
At the tripartite meeting, the PCBs committed to bring down the overall interest rate spread at around 5.0 per cent from existing 6.05 per cent.
"Reduce interest rates on lending to productive sector excluding consumer and credit card lending," the BB said in its letter quoting BAB and ABB joint proposal.
The PCBs, however, proposed to the BB that they will reduce interest rates on large and medium scale industries loans to 14.75 per cent from the existing 16.00 per cent while the interest rates for working capital will be brought down to 14.50 per cent from existing 15.50 per cent.
The country's business community has been advised to avail themselves of the lower interest rates and reduced bank charges as promised by the bankers in a recent meeting with the central bank, officials said.
The Bangladesh Bank (BB) sent letters to all the chambers across the country Tuesday with the minutes of the tripartite meeting attended by BB officials, representatives of Bangladesh Association of Banks (BAB) and Association of Bankers, Bangladesh (ABB), at the central bank on March 3 last.
"We have already sent copies of the letter to 67 chamber bodies across the country to inform the bankers' commitments on the issues," a BB senior official told the FE Tuesday.
He also said the central bank expects that the business community will be benefited from the latest move.
Besides, the central bank will want to know from the commercial banks about the progress in the implementation of their commitments at a bankers meeting scheduled to be held March 27 next with the BB Governor Salehuddin Ahmed in the chair.
The private commercial banks (PCBs) have already given commitments to the central bank to lower their lending rates by more than 1.0 percentage point on lending rates and slash different bank charges.
During the meeting, the commercial bankers will inform the central bank on the measures that they have taken in compliance with the BB's instructions relating to curbing price hike of essentials in the local markets.
On March 16 last, the central bank instructed the commercial banks to charge maximum 12 per cent interest against import of powdered milk for the time being to curb the price hike of the item in the local markets.
The BB through a similar circular instructed the commercial banks on August 14, 2007 to charge interest rates at maximum 12 per cent on import of ten essential commodities including rice, wheat, sugar, edible oil, gram, lentils, pulses, onion, spices and date.
At the tripartite meeting, the PCBs committed to bring down the overall interest rate spread at around 5.0 per cent from existing 6.05 per cent.
"Reduce interest rates on lending to productive sector excluding consumer and credit card lending," the BB said in its letter quoting BAB and ABB joint proposal.
The PCBs, however, proposed to the BB that they will reduce interest rates on large and medium scale industries loans to 14.75 per cent from the existing 16.00 per cent while the interest rates for working capital will be brought down to 14.50 per cent from existing 15.50 per cent.