Don\\\'t manipulate loan accounts, NBFIs warned

Bangladesh Bank (BB) Wednesday warned all non-banking financial institutions (NBFIs) against manipulating revolving loan accounts to ensuring transparency and accountability in the financial sector, reports BSS.

The central bank in a directive said many NBFIs had been renewing the revolving loan of their clients violating the existing rules and regulations.

As per the regulations, only the loans of the clients who paid their monthly installments and repaired the entire loan amount at maturity could be renewed.

"But, many NBFIs found not following the regulations as they renewed the loans of their clients who failed to pay monthly installments and repay the loan amount," the central bank said, referring to its recent on-site and off-site supervisions.

The central bank also said that it had found some NBFIs were renewing the loan and including those in their regular loan portfolio, risking their entire business.

BB advised the NBFIs to stop such irregular practice.

Meanwhile, with doubling the limit of the bullet repayment for external trade financing, BB is going to give a boost to import of essential items during Ramadan.

The central bank in another circular enhanced the limit of bullet repayment from $500,000 to $1,000,000 for external import financing, meaning shipment not exceeding $1 million would be allowed six-month deferred payment.

Currently, deferred payment is allowed only on shipments not exceeding $500,000 or equivalent in value.