The Bangladesh Bank on Sunday asked scheduled banks to send compliance reports on the banks’ financing in the housing and real estate sector within June 30, 2013 to its
Banking Regulation and Policy Department.
The BB issued a circular to managing directors and chief executive officers of all banks saying that the banks would have to place the compliance report referring that whether their clients in the housing and real estate sector had followed the regulations set by the government and the central bank.
The circular said that the banks would have to ensure before financing the clients that whether they followed the required laws and regulations to set up their residential or commercial buildings, infrastructure and land development, and while purchasing building, floor and apartments.
A BB official told New Age on Sunday that the central bank had observed that some banks were disbursing loans to private ventures for developing land or constructing buildings that do not have the approval of the authorities concerned.
Under the circumstances, the country experience tragedies like that of collapse of Rana Plaza in Savar on Wednesday which killed more than 375 garment workers and injured hundreds of others till Sunday evening, he said.
The BB issued the circular in a bid to ensure the banks’ financing to clients so that they (clients) will take prior approval from the authorities concerned to build their infrastructure.
He said that the BB would take action against the banks which had not followed the compliance rules for financing in housing and real-estate sector.
The central bank circular said that the banks will disburse loans to the housing sector if the clients follow the laws and regulations like the Building Construction Act-1952, Bangladesh National Building Code-2006, Bangladesh Environment Conservation Act-1995, Environment Conservation Rules-1997, Fire Protection and Prevention Act-2003, Private Housing Project Land Development Rules-2004.
The BB asked the banks to ensure that their clients take prior approval of the housing projects from the National Housing Authority, Rajdhani Unnayan Kartripakkha and development authorities of City Corporations concerned.
Apart from the city corporation, the clients will take prior approval of their housing projects from the respective municipalities, it said.
The banks will also have to ensure after the financing in the housing projects whether their clients followed the laws and regulations, the circular said.
Besides, the banks will have to make sure that they maintained the compliance with their own buildings and infrastructure development and their purchased floor or space.
The BB on Thursday in a different circular asked the banks to verify whether the buildings they were going to select for their offices and branches got the building code approval from the authorities concerned.
The BB asked the banks to examine the structural strength of the buildings by their own panels of engineers before using the spaces as banks’ office or branches.
-With New Age input
