FE Report
The Bangladesh Bank will take punitive measures against the country's commercial banks that will fail to disburse the targeted loans in agricultural sector.
"The BB will deduct 3 per cent of non-disbursed agricultural loans from the respective banks' current account if they fail to achieve target of farm loan disbursement," Governor Dr Atiur Rahman told the bankers while launching the agriculture and rural credit policy and Programme for the fiscal year 2012-13.
However, the BB has set the target of agricultural loan disbursement through commercial banks at Taka 141.30 billion in current fiscal year 2012-13, about 2.39 per cent higher than taka 138.00 billion last year.
All chief executive officers and managing directors of nationalised, private and foreign commercial banks were present at the meeting. Senior consultant and adviser to the governor Allah Malik Kazemi, deputy governor SK Sur Chowdhury, Nazneen Sultana, president of Association of Bankers Bangladesh Nurul Amin were also present.
Briefing journalists on new policy of agricultural loan, SK Sur said, the central bank wants to keep the banks under pressure so that they can put in more efforts to disburse agricultural and a rural credit to the farmers. As per the new policy measures, the banks those failed to achieve the agricultural loan disbursement target in the last fiscal will deposit 3 per cent on the shortfall with central bank. The banks will have to address the shortfall in the current fiscal withew target.
The farmers, who will be identified as sincere borrowers, will be able to get loans at subsidised rate of bank interest. They may also get priority to access loans with 2 or 3 per cent rebate on the interest rate.
The banks have also welcomed the loan policy. They have also promised to become serious in disbursement of agri loan for grater benefit of the economy, he said.
UNB adds:The central bank has already advised the 44 banks - 30 private commercial banks, nine foreign banks, four state-owned banks and three specialised banks - to increase their target for agriculture and rural credit.
The state-owned commercial banks (SCBs), the specialised banks (SBs), private commercial banks (PCBs) and foreign commercial banks (FCBs) will disburse the credit simultaneously following the BB directives.
The banks disbursed 97 per cent of last 2010-2011 fiscal year's Tk 12,600 crore target.
The new policy support is expected to help directly keep the price level of foodstuff within the purchasing power of the mass people through increasing agricultural production and reducing dependency on import and alleviate rural poverty through increased flow of funds in rural areas, according to the policy statement.
In the last fiscal, a total of Tk 13132.15 crore of agricultural and rural credit was disbursed by four of nationalised, three of specialised, 29 of private and nine of foreign banks, which is 95.16 per cent against their target.
This disbursed amount is Tk 1700.22 crore (14.87 per cent) higher than the previous fiscal year's disbursement.
Besides, Brac, under BB's special refinance programme for sharecropper, has disbursed towards sharecropper an amount of Tk 246.18 crore and BRDB also disbursed an amount of Tk 567.48 crore of agri and rural credit in the last fiscal year.
FE report further adds: The farmers are always contributing to our economy as the BB is sincerely trying to encourage them up with various supportive initiatives including introduction of a 10 taka bank account for the farmers. At least 1.30 billion farmers have opened this account until now, he noted.
About 95 per cent of agricultural loan disbursement target was achieved in the just concluded fiscal year 2011-12, which was about 9 per cent up than the corresponding year. On the other hand, overall recovery of agricultural loan was 67 per cent during the time, the BB data shows.
President of the Association of Bankers Bangladesh Nurul Amin said we are satisfied with the BB's policy on agricultural loan.
The agricultural loan is getting importance among the banks as they are coming forward to contribute to the economy. Foreign commercial banks are also getting more involved with the sector. So we do not have objection about the loan target and policy stance by the central bank, he added.
But we hope the BB will work out to increase the sub-sector of agricultural loan. Currently the list contains 101 sub-sectors. If the list is bigger the banks will be more encouraged to provide loans. We have also urged the BB to take steps for the farmers account to 100 taka instead of 10 taka account, Nurul Amin said.
The Bangladesh Bank will take punitive measures against the country's commercial banks that will fail to disburse the targeted loans in agricultural sector.
"The BB will deduct 3 per cent of non-disbursed agricultural loans from the respective banks' current account if they fail to achieve target of farm loan disbursement," Governor Dr Atiur Rahman told the bankers while launching the agriculture and rural credit policy and Programme for the fiscal year 2012-13.
However, the BB has set the target of agricultural loan disbursement through commercial banks at Taka 141.30 billion in current fiscal year 2012-13, about 2.39 per cent higher than taka 138.00 billion last year.
All chief executive officers and managing directors of nationalised, private and foreign commercial banks were present at the meeting. Senior consultant and adviser to the governor Allah Malik Kazemi, deputy governor SK Sur Chowdhury, Nazneen Sultana, president of Association of Bankers Bangladesh Nurul Amin were also present.
Briefing journalists on new policy of agricultural loan, SK Sur said, the central bank wants to keep the banks under pressure so that they can put in more efforts to disburse agricultural and a rural credit to the farmers. As per the new policy measures, the banks those failed to achieve the agricultural loan disbursement target in the last fiscal will deposit 3 per cent on the shortfall with central bank. The banks will have to address the shortfall in the current fiscal withew target.
The farmers, who will be identified as sincere borrowers, will be able to get loans at subsidised rate of bank interest. They may also get priority to access loans with 2 or 3 per cent rebate on the interest rate.
The banks have also welcomed the loan policy. They have also promised to become serious in disbursement of agri loan for grater benefit of the economy, he said.
UNB adds:The central bank has already advised the 44 banks - 30 private commercial banks, nine foreign banks, four state-owned banks and three specialised banks - to increase their target for agriculture and rural credit.
The state-owned commercial banks (SCBs), the specialised banks (SBs), private commercial banks (PCBs) and foreign commercial banks (FCBs) will disburse the credit simultaneously following the BB directives.
The banks disbursed 97 per cent of last 2010-2011 fiscal year's Tk 12,600 crore target.
The new policy support is expected to help directly keep the price level of foodstuff within the purchasing power of the mass people through increasing agricultural production and reducing dependency on import and alleviate rural poverty through increased flow of funds in rural areas, according to the policy statement.
In the last fiscal, a total of Tk 13132.15 crore of agricultural and rural credit was disbursed by four of nationalised, three of specialised, 29 of private and nine of foreign banks, which is 95.16 per cent against their target.
This disbursed amount is Tk 1700.22 crore (14.87 per cent) higher than the previous fiscal year's disbursement.
Besides, Brac, under BB's special refinance programme for sharecropper, has disbursed towards sharecropper an amount of Tk 246.18 crore and BRDB also disbursed an amount of Tk 567.48 crore of agri and rural credit in the last fiscal year.
FE report further adds: The farmers are always contributing to our economy as the BB is sincerely trying to encourage them up with various supportive initiatives including introduction of a 10 taka bank account for the farmers. At least 1.30 billion farmers have opened this account until now, he noted.
About 95 per cent of agricultural loan disbursement target was achieved in the just concluded fiscal year 2011-12, which was about 9 per cent up than the corresponding year. On the other hand, overall recovery of agricultural loan was 67 per cent during the time, the BB data shows.
President of the Association of Bankers Bangladesh Nurul Amin said we are satisfied with the BB's policy on agricultural loan.
The agricultural loan is getting importance among the banks as they are coming forward to contribute to the economy. Foreign commercial banks are also getting more involved with the sector. So we do not have objection about the loan target and policy stance by the central bank, he added.
But we hope the BB will work out to increase the sub-sector of agricultural loan. Currently the list contains 101 sub-sectors. If the list is bigger the banks will be more encouraged to provide loans. We have also urged the BB to take steps for the farmers account to 100 taka instead of 10 taka account, Nurul Amin said.
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