Over 200 firms seek BB policy support

Over 200 companies, including large industrial conglomerates, defaulted businesses, loss-incurring concerns, and small businesses, have applied to the Bangladesh Bank for policy support, especially loan restructuring and rescheduling facilities.

In January this year, the central bank formed a five-member committee led by Executive Director Mezbah Ul Haque to provide necessary policy support for restructuring corporate borrowers that have defaulted on loans due to factors beyond their control.

Since its formation, the committee has continued to meet with companies that applied to the central bank for policy support.

Initially, the deadline for applications was April 30, but the tenure was extended till May 31, The Daily Star learned from members of the committee.

They also said that Deshbandhu Group, Orion Group, Beximco Group, AG Group, S Alam Group, Bashundhara Group, and Magpie Textile were on the list of applicants seeking policy support.

A member of the committee, seeking anonymity, told The Daily Star that different kinds of policy support would be provided based on specific demands and needs.

Some companies are likely to get a lower down payment, while others may get a longer tenure to repay the loans to continue business operations, he added.

"We found that a majority of businesses faced trouble due to foreign exchange fluctuations in the last several years," the committee member said, adding that exchange losses had caused businesses to face a reduction in working capital.

Additionally, some companies faced challenges due to the Russia-Ukraine war, while others struggled due to unrest and political instability.

Companies and industrial units that faced problems due to issues beyond their control will receive policy support, but those involved in scams, irregularities, and money laundering will not receive the facility, as per committee members.

The committee is assessing whether corporate borrowers that are struggling to repay their loans were genuinely affected by factors beyond their control and determining whether any restructuring or policy support could help revive their businesses.

It will also specifically examine companies with defaulted loans of at least Tk 50 crore.

They said this move is one of many initiatives aimed at sustaining the economy and strengthening the banking sector amid macroeconomic challenges.

Defaulted loans in the country's banking sector reached a record Tk 345,765 crore at the end of 2024, as toxic loans increased sharply following the political changeover in August last year.

Bankers said that they are now in a difficult situation in terms of loan recovery because almost all borrowers have halted repayment of bank loans after applying to the central bank for policy support.