BRPD Circular Letter No. 33: Financial stimulus package to mitigate probable economic impact due to breakout of Novel Corona Virus (COVID-19)

Ref No: BRPD Circular Letter No. 33 Banking Regulation and Policy Department Bangladesh Bank Head Office Dhaka. 25 June 2020 BRPD Circular Letter No. 33 Date: --------------------- 11 Aasharh 1427 Managing Director/Chief Executive All Scheduled Banks and Financial Institutions operating in Bangladesh. Dear Sir, Regarding the financial stimulus package to mitigate the probable economic impact in Bangladesh due to the outbreak of Novel Corona Virus (COVID-19).

Reference is drawn to your attention to BRPD Circular No. 08 dated 12 April 2020, BRPD Circular Letter No. 22 dated 03 May 2020, BRPD Circular Letter No. 25 dated 10 May 2020, and BRPD Circular Letter No. 30 dated 11 June 2020, on the subject cited above.

2. In Clause 2(g), 5(c) to 5(g), 6(c), and 7(d) of BRPD Circular No. 08/2020, the limits and tenures for loans/investments per customer category under the discussed package have been specified. It is hoped that by providing loan/investment facilities to a large number of institutions affected by the outbreak of the Corona Virus under the discussed package, those institutions can be made operational and revitalized. Now, in order to provide loan/investment facilities as Working Capital to a large number of affected institutions, the following decisions have been taken:

a) The tenure of loans/investments per customer category under this package shall be maximum 1 (one) year. If it is not possible to provide the entire eligible amount of loans/investments to any customer within one year in accordance with BRPD Circular No. 08/2020, the remaining eligible amount shall be provided as loans/investments within the remaining tenure of the discussed package.

b) The total amount of loans/investments for existing loan/investment borrowers/customers shall not exceed 30% of the Working Capital limit approved/disbursed as of 31 December 2019. Furthermore, for new loan/investment borrowers, the eligibility limit for loans/investments for Working Capital shall not exceed 30% under the existing policy framework.

c) Regardless of how a bank provides loans/investments to any loan/investment borrower (whether in a lump sum or provided in multiple years during the package's tenure), the concerned bank shall be entitled to interest/profit on the loans/investments provided within the total limit specified in Clause 2(b) of this Circular Letter for one customer.

3. Other instructions mentioned in the referenced circulars and circular letters shall remain unchanged.

4. These instructions are issued under the powers granted by Section 45 of the Bank Company Act, 1991.

5. These instructions shall come into force immediately.

Yours faithfully, (Md. Nazrul Islam) Deputy Governor Phone: 9530252