FARM LOAN DISBURSEMENT
BB to act against 7 failed banks
Bangladesh Bank will take punitive action against seven local and foreign commercial banks which failed in fulfilling their annual farm loan disbursement target in the
just concluded financial year, said central bank officials.
The central bank may cut the non-disbursed farm loan amount of money of the commercial banks which is reserved as deposit money of the banks with the BB fund as punishment, a BB official told New Age on Thursday.
The failed banks are National Bank of Pakistan, Bangladesh Commerce Bank, BRAC Bank, IFIC Bank, National Bank, Shahjalal Islami Bank and Southeast Bank.
The NBP did not disburse any farm loan in the FY 2012-13 against its target of Tk 19 crore, BCB disbursed Tk 5.97 crore against the target of Tk 19 crore, BRAC Bank disbursed Tk 153.50 crore against Tk 179 crore, IFIC Bank disbursed Tk 107.67 crore against Tk 122 crore, National Bank disbursed Tk 197.05 crore against Tk 228 crore, Shahjalal Islami Bank disbursed Tk 39.66 crore against Tk 184 crore and Southeast Bank disbursed Tk 71.31 crore against Tk 212 crore.
The BB, however, will not take any punitive measure against the state-owned and specialised banks which failed in fulfilling their target in the concluded FY.
The BB official said 24 banks out of 45 commercial banks, which had farm loan programmes, failed to disburse 100 per cent loans among the farmers in the FY 12.
The central bank deducted three per cent of non-disbursed farm loans from the banks’ deposit money which had failed to disburse 100 per cent loans to the farmers.
The amounts were kept with the central bank fund and it was repaid without any interest if the commercial banks disburse the amount with the new farm loan target for the FY 13, he said.
The official said that the BB had frequently warned the banks about the punitive action if they fail to disburse loan against the target for the FY 13.
The farm loan disbursement by the commercial banks increased significantly in the FY 13 due to the BB’s punitive measures in the FY 12.
The BB set a target of Tk 14,130 crore of farm loans for FY 13.
All banks collectively disbursed Tk 14,667.49 crore, or 103.80 per cent of the target, in farm loans in the FY 13.
In the FY 13, the state-owned commercial banks — Sonali, Janata, Agrani and Rupali — and the two specialised banks — Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank — together disbursed Tk 8,318.80 crore, or 96.65 per cent of their annual loan disbursement target of Tk 8,607 crore.
The private and foreign commercial banks together disbursed Tk 6,348.69 crore in agricultural loan in the FY 13, which was 114.95 per cent of their total annual loan disbursement target of Tk 5,523 crore.
The figure increased as majority of the banks disbursed significant amount of loan in agriculture sector due to a lower credit demand from the industrial sector, said another BB official.
He said the country’s businesspeople had recently adopted a ‘wait and see’ approach to expand their investment due to the ongoing political violence which pushed up the banks’ farm loan disbursement in the last few months.
Besides, the banks have also taken a cautious policy to sanction fresh industrial loan as a number of scams have recently been perpetrated in the banking sector, he said.
Besides, the agriculture credit committee is now more active in district level in supervising the loan program which pushed up the banks’ farm loan disbursement, he said.
-With New Age input
