Govt issues Tk 20b state guarantee for RAKUB refinance loan

FE REPORT
The government has extended a state guarantee for a Tk 20 billion re-financing loan from Bangladesh Bank to Rajshahi Krishi Unnayan Bank (RAKUB), aimed at strengthening the bank's capacity to operate agricultural and rural credit programmes.
The Ministry of Finance issued the guarantee on Monday, which will remain valid for one year from the date of issuance.
The state-backed facility comes with a set of conditions. Among the key requirements, RAKUB must submit its audited financial report for the 2023-24 fiscal year within the next month to the Finance Division.
In addition, the bank is obligated to present a detailed work plan outlining strategies to expand business operations, reduce non-performing loans (NPLs), and enhance operational efficiency. The ministry has also said that the total amount of loan must be paid off within the guarantee period. Otherwise, new state guarantee would not be issued again in favour of RAKUB. The ministry concerned will actively monitor the bank's financial activities, including classified loans and operational performance.
RAKUB, the only state-owned specialised bank headquartered outside Dhaka -- in Rajshahi -- plays a crucial role in agricultural financing in the northwestern region.
According to the bank's data, it operates 383 branches, including 194 in Rajshahi and 187 in Rangpur divisions. Of these, 333 are located in rural areas, with the remaining 50 in urban centres.
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