BRPD Circular Letter No. 04: Resolving Existing Difficulties of Raw Jute Exporters

Bangladesh Bank Head Office Motijheel, Dhaka-1000 Bangladesh. website: www.bb.org.bd

Banking Regulation and Policy Department

BRPD Circular Letter No. 04 Date: 16 February 2024 03 Falgun 1431

Managing Director / Chief Executive Officer All Scheduled Banks Operating in Bangladesh

Dear Sir,

Regarding the Resolution of Existing Difficulties of 100% Foreign Exchange-Earning Raw Jute Exporters

Reference is invited to BRPD Circular Letter No. 27, dated: 07 July 2022, along with the Memorandum No. 53.00.0000.331.38.005.21.169 dated 29 June 2022 from the Financial Institutions Department, Ministry of Finance.

2. The aforementioned Memorandum, detailing various decisions taken by the government to resolve the existing problems of raw jute exporters, was previously sent to you for information and necessary action. Now, the government has decided that a two-year moratorium facility may be provided again by taking a 2% down payment on the loan position. In this regard, the existing loan position as of 31 March 2024 shall be considered. Furthermore, all other conditions mentioned in the aforementioned Memorandum shall remain unchanged.

3. This directive shall come into force immediately.

Yours faithfully,

(Signature) (Mohammad Shahriar Siddique) Director (BRPD) Phone: 9530252

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Government of the People's Republic of Bangladesh Ministry of Finance Financial Institutions Department Policy and Financial Incentive Branch www.fid.gov.bd

Memorandum No.: 53.00.0000.331.38.005.21.169 Date: 15 Asharh, 1429 29 June 2022

Subject: Bringing business back by resolving the existing problems of raw jute exporters. Source: Letter No. 53.00.0000.331.38.002.17-109 dated 24-04-2017 from the Financial Institutions Department

In the context of the letter mentioned above and sourced, the government has decided to provide assistance as follows to resolve the existing problems of raw jute exporters:

a) Determining the total outstanding balance of the loan accounts of raw jute exporter borrowers as of 31 March 2022, transferring it to a blocked account, and providing a facility for repayment over 10 years along with a 2-year moratorium facility; b) In this regard, considering 100% of the unpaid interest of the borrowers' loan accounts and waiving the applied interest according to rules; c) Collecting a minimum down payment of 2% in the case of providing relief facilities; d) Charging interest on the transferred loans in the blocked account at the Cost of Fund rate; e) Developing funds by regularly deducting 2% of the bill value during the moratorium period and a maximum of 5% on a case-to-case basis after the moratorium period from each export bill/sales bill, which shall be used for installment adjustment; f) In the case of approving new loans, the concerned bank shall take a decision based on its own consideration regarding the minimum deposit acceptance based on the bank-customer relationship; g) Following/adhering to the bank's existing policy regarding collateral against loans; h) If those who fail to apply by depositing a 2% down payment (FDI interest earned + cash) within 6 (six) months of the circular issuance are considered, the FDI shall be encashed and deposited into the loan account, and legal action shall be taken in accordance with existing policies to recover the remaining dues; and i) If the loan accounts are transferred to the blocked account, provisions shall be made for the resolution of ongoing related cases pending in court through the Supreme Court.

2. In light of the above decisions, you are hereby directed to take further necessary actions.

(Signature) 29-6-2022 Md. Zahid Hossain