BB’s relaxed loan rescheduling policy no boon for farmers
Defaulted farm loans increase by Tk 818.77cr in JanuaryAKM Zamir Uddin
Bangladesh Bank’s relaxed rescheduling loan policy has brought no boon for farmers as the defaulted loans in the agriculture sector increased by Tk 818.77 crore in January, said officials of the central bank.
The loan defaulting trend in the agricultural sector increased while overall defaulted loans declined significantly in the last quarter of 2013 as the banks rescheduled their defaulted loans on wholesale-basis by using the central bank’s relaxed loan rescheduling policy.
A BB official told New Age on Wednesday that the banks had provided the influential businesspeople and political persons backed by the government with the central bank facility.
But the farmers failed to reach the top officials of the banks to reschedule their defaulted loans and the banks also showed a little interest to save the farmers from the defaulting situation, the official said.
According to the central bank data released on Wednesday, the defaulted farm loans in the banking sector increased by 44 per cent as of January 31, 2014 from the same date a year ago.
The defaulted farm loans stood at Tk 7,029.90 crore as of January 31, 2014 from Tk 4,879.27 crore in the corresponding period of 2013.
The defaulted farm loans in January increased by 13.18 per cent, or to Tk 818.77 crore as the classified loans stood at Tk 6,211.13 crore as of December 31, 2013.
The BB in third week of December 2013 issued separate circulars to all banks saying that they would be able to reschedule their defaulted loans, which were hit hard by recent political unrest, without receiving any down payment.
The central bank in its circulars asked the banks to provide the farmers, who were affected by the recent political turmoil, with the facility.
Due to the relaxed BB policy, the overall defaulted loans in the banking sector decreased to Tk 40,583.01 crore as of December 31, 2013 from Tk 42,725.51 crore as of December 31, 2012.
But defaulted loans, which went up to Tk 56,720.10 crore as of September 30, of 2013, declined by 28.45 per cent, or 16,137.09 crore in three months as of December 31, 2013, showed the BB data.
He feared that the recent rescheduled loans might convert again into defaulting situation as the habitual defaulters picked up the central bank’s facility.
The marginal farmers, on the other hand, could not get the relaxed rescheduled policy although they were most affected due to the political unrest, he said.
The farmers failed to send the products to district and divisional headquarters due to the frequent blockades and strikes called by the opposition parties in the last three months of 2013 and early January of 2014.
As of January 31, 2014, the defaulted farm loans stood at Tk 1,148.35 crore at Sonali Bank, Tk 225.50 crore at Janata Bank, Tk 278.14 crore at Agrani Bank, Tk 22.39 crore at Rupali Bank, Tk 3781.69 crore at Bangladesh Krishi Bank and Tk 1,488.55 crore at Rajshahi Krishi Unnayan Bank.
The defaulted farm loans at private and foreign commercial banks stood at Tk 85.28 crore as of January 31, 2014.
The defaulted loans in the agriculture sector will increase more in the months to come as the overdue farm loans increased by 42.60 per cent in January 2014 on year-on-year basis.
The overdue farm loans in the banking sector stood at Tk 8,409.23 crore as of January 31, 2014 from Tk 5,896.90 crore as of January 31, 2013.
BB deputy governor SK Sur Chowdhury told New Age that the central bank had already asked the banks to provide the farmers with the relaxed policy.
The banks will make decision in this connection on the basis of bankers-customers relationship, he said.
The BB data, however, showed the farm loan disbursement by the banks increased by 14.19 per cent in the first seven months of the FY14 from that in the same period of the FY13.
The farm loan disbursement by the banks stood at Tk 8,819.96 crore in the first seven months of the FY14 against Tk 7,723.60 crore in the same period of the FY13.
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