Bangladesh Bank is likely to set farm loan disbursement target for local and foreign banks at around Tk 14,593 crore for fiscal year 2013-14, said officials of the central bank.
The probable loan disbursement target is 3.27 per cent higher than that of the current fiscal year. The BB had set annual farm loan disbursement target at Tk 14,130 crore for the FY 2012-13, Tk 13,800 crore for the FY 2011-12 and Tk 12,617.40 crore for the FY 2010-11.
According to the BB policy, every bank has to disburse at least two per cent of their total lending in the agricultural sector, a central bank official told New Age on Tuesday.
The BB has set the new target of farm loan disbursement for the FY 2013-14 on the basis of the banks’ outstanding loan and advances, he said.
He said the BB had already issued letters to all banks to seek their stance about the farm loan disbursement target for the upcoming fiscal year.
He, however, said that the BB target might be slightly revised if any bank requests the BB to change its annual target.
According to the BB data, the central bank has primarily set a loan disbursement target of Tk 2,707 crore for the four state-owned banks — Sonali, Agrani, Janata and Rupali.
For the FY 2013-14, Tk 5,900 crore and Tk 5,547 crore have been set as annual farm loan disbursement target for the specialised banks and the private commercial banks respectively.
The nine foreign commercial banks are set to disburse Tk 439 crore in the FY 2013-14.
The central bank will finalise the annual loan disbursement target before June 6 as finance minister Abul Maal Abdul Muhith will place his budget speech on the day in which he will declare the farm loan disbursement target.
The BB official said they hoped that the banks would be able to fulfil their disbursement target in the next fiscal year, as the growth rate in farm loan disbursement was satisfactory in the last fiscal years.
The banks disbursed Tk 13,136.91 crore, or 95 per cent of the annual target of Tk 13,180 crore in farm loan in the FY 2011-2012.
In FY 2010-11, the banks disbursed Tk 11,431.93 crore, or 96.50 per cent, in farm loan against the target of Tk 11,846.40 crore.
Farm loan disbursement by the banks stood at Tk 11,740.16 crore in July-April of the FY 2012-13 against the annual target of Tk 14,130 crore.
The banks collectively disbursed 83.09 per cent of their annual farm loan target in the first 10 months of the FY 2012-13 whereas 73.92 per cent was disbursed during the same period of the FY 2011-12.
Another BB official, however, said that a majority of the banks was now enjoying a surplus liquidity due to a lower credit demand from the private sector, specially the industrial sector.
Under the circumstance, the banks are now investing their significant amount of fund in government securities with a lower interest rate of 8 per cent to 12.16 per cent, he said.
Besides, the banks have also been encouraged to disburse farm loan with an interest rate of 13 per cent in a bid to mobilise their idle fund, he said.
-With New Age input
