BB Chief Asks Errant Banks To Follow Lending Rates
Thursday, 14 May 2009

Some banks are not following the lending rates ceiling the Bangladesh Bank has set in the backdrop of the financial downturn and are realising hefty interests, the central bank chief said on Wednesday.

"Some banks are not following the central bank directives issued with regard to the lending interest rates. They are still charging higher than what has been fixed by the Bangladesh Bank as the ceiling by inventing definitions," governor Atiur Rahman governor said at 'bankers' meeting' with the chief executives of the government, private and foreign banks on Wednesday.

"Confusions are being created over the lending rates for small and medium enterprises, which are not desirable.

"We hope that you will appreciate the intrinsic motive that prompted us to fix the ceiling and carry on with your transactions accordingly."

On April 19, the government declared an incentive package to help recession-hit export-focused industries to deal with the ongoing global crunch.

Under its purview, the central bank on that very day decreed through a circular that 13 percent would be the highest rate of bank interest to be levied in the productive sectors.

In a bid to keep commodity prices stable, the bank in another circular issued on May 5 set 12 percent as the highest rate that may be charged on the importers of eight consumer commodities including edible oil, lentils and onion.

This was the first-ever 'bankers' meeting' held since Rahman' assumed office as the BB boss on May 1.

The new governor put up a roadmap, a written forecast and account, before all present delineating his envisaged activities through his four-year term.

The last page of his roadmap mentioned the errant banks not adhering to the central bank orders with regard to bank interests.

Source: bdnews24.com

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