BRPD Circular Letter No. 27: Interest/Profit Rate of Loan/Investment

Bangladesh Bank Chief Executive Motijheel, Dhaka-1000 Bangladesh Ref No.: BRPD Circular Letter No. 27 Banking Regulation and Policy Department 27 July 2023 12 Srabon 1430

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

Dear Sir,

Subject: Interest/Profit Rate of Loan/Investment.

1. Reference is drawn to your attention to BRPD Circular Letter No. 09 dated 19 June 2023 on the subject cited above.

2. Through the aforementioned circular, you are instructed to follow the guidelines provided for the formulation of policies to introduce market-based interest rates for loans distributed by banks.

3. Now, in the context of the global adverse economic situation, to make export-oriented industrial establishments more resilient to shocks, to continue the ongoing process of development and expansion of the country's export-oriented industries, and to ensure more efficient loan management, the following instructions will be followed:

(a) In determining the interest rate for pre-shipment export loans, the interest rate must be determined by adding a maximum of 2% to the prevailing BBS rate;

(b) If any loan or installment of a loan is identified as rescheduled (Rescheduled), penalty interest at a maximum rate of 1.5% may be charged on the total outstanding amount of the loan/overdraft for the period of rescheduling, and on the rescheduled installment for term loans.

4. In addition, the other instructions of BRPD Circular Letter No. 09/2023 will remain unchanged.

5. This instruction will take immediate effect.

6. This instruction is issued under the powers granted by Section 29(2)(c) of the Bank Company Act, 1991.

Yours faithfully,

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