Defaulted loans see no rise, claims minister


13th November, 2019 08:08:18 printer

Defaulted loans see no rise, claims minister

Finance Minister AHM Mustafa Kamal on Wednesday claimed that the amount of defaulted loans has not increased in the country compared to that in 1991.
He made the statement while responding to a supplementary question in Parliament.
The minister said the amount of defaulted loans in 1991 was Tk 5,039 crore out of total disbursed amount of Tk 19,278 crore, which is 26.14 percent.
He also mentioned that currently the disbursed loan amount is Tk 962,277 crore while the amount of defaulted loan is Tk 112,425 crore, which is 11.69 percent. “That means the amount of defaulted loans has not increased,” he said.
Mustafa Kamal, however, said there should not be any defaulted loan. “It would have been better if we could bring down the percentage of the defaulted loans to single digit. We’ll take step as far as we can to this end,” he said.
He said some defaulted loans were created due to some system problems. “The interest rate of banks is higher due to the compound rate instead of simple one,” he said.
The minister said the Financial Institutions Division of the Finance Ministry has asked all the scheduled banks to form a monitoring cell to ensure close monitoring on classified loans worth Tk 100 crore and above.
He made the disclosure responding to a question from treasury bench MP Mohibur Rahman Manik.
Mustafa Kamal also said the Bangladesh Bank does not make any direct interference in scheduled banks for market-based interest rate though it is giving some instructions to the banks in different times to set the interest rate of loans at a logical level.
He said the central bank is also monitoring the savings and loan interest rate in every month while it also give moral pressure on the scheduled banks to reduce the loan interest rate.
The minister said the scheduled banks were also asked to open separate Risk Management Unit to handle the possible risks.

Responding to a question from Jatiya Party MP Kazi Firoz Rashid, he said the tax payment process will be made totally hassle-free from the current fiscal year as the system would be automated soon.