Tanners get 3 months’ time extension to repay default loans
Bangladesh Bank today extended the deadline for tanners to repay default loans by three months under relaxed facilities given the upcoming Eid-ul-Azha.
The tanneries, which are facing the burden of default loans for years, are now allowed to repay their non-performing loans (NPLs) in a relaxed manner by September, according to a Bangladesh Bank (BB) notice.
In addition, BB also considered the ongoing business slowdown caused by the coronavirus pandemic for extension of the deadline.
Banks are allowed to offer a one-time exit policy with only a 2 per cent down payment for the tannery owners, who are unable to run their business.
The tannery owners, whose bank loans amounted to up to Tk 5 crore as of December 31 last year, will get a three-year timeframe for the exit.
Defaulters with loans of more than Tk 5 crore will have a maximum of five years to repay the loans.
The tannery owners, who are able to run their business, will enjoy a rescheduling facility by making only a 2 per cent down payment.
Banks are permitted to reschedule the loans for 10 years, which include a one-year grace period.
Banks can impose a maximum of 9 per cent interest on the rescheduled or restructured loans.
The interest amount of the loans can be rebated by banks but there is no scope to waive the principal amount.
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