Regulatory Alerts2022-11-08
Added
BRPD Circular Letter No. 44: Exemption from the provision of section 26kha(1) of Bank Company Act, 1991 regarding general credit limit to coal-based electricity producing companies
The Bangladesh Bank exempts banks from the general credit limit restrictions under section 26kha(1) of the Bank Company Act, 1991, for loans provided to entities for establishing coal-based power plants and purchasing raw materials like coal for electricity production. This exemption applies for a period of five years from November 8, 2022. While the specific upper limit for credit is to be determined by the Bangladesh Bank, the standard prohibition under the Act does not apply during this period.
BRPD Circular Letter No. 44 Banking Regulation and Policy Department Bangladesh Bank Head Office Dhaka. BRPD Circular Letter No. - 44 23 Kartik 1429 Date: ----------------------- 08 November 2022 Managing Director / Chief Executive Officer All Scheduled Banks operating in Bangladesh. Dear Sir, Regarding the provision of exemption from the provision of section 26kha(1) of the Bank Company Act, 1991 concerning the general credit limit to coal-based electricity producing establishments. A copy of the notification No.- BRPD(R-1) (Review) 717/2022-11335 dated 08 November 2022 issued by Bangladesh Bank on the above subject is enclosed herewith for your information and necessary action.
Yours faithfully, Enclosure: 01 (One) (Md. Ali Akbar Farazi) Director (BRPD) Phone-9530095
Banking Regulation and Policy Department Bangladesh Bank Head Office Dhaka. Notification 23 Kartik 1429 No.- BRPD(R-1) (Review) 717/2022-11335 Date: ----------------------- 08 November 2022 Under the powers conferred by section 121 of the Bank Company Act, 1991 (Act No. 14 of 1991), it is hereby notified for general information that, in order to ensure uninterrupted supply of electricity required for electricity production, the prohibition contained in section 26kha(1) of the Bank Company Act, 1991 shall not be applicable for the next five (5) years in the case of any individual, establishment or group obtaining approval from Bangladesh Bank for providing loans by any bank for expenses such as land purchase, import and purchase of machinery, installation of machinery, repair, maintenance, etc., for establishing coal-based power plants in the said sector, and for expenses incurred for purchasing or importing coal and other raw materials used for electricity production. However, the upper limit shall be determined by Bangladesh Bank for the next five (5) years instead of the 25% upper limit mentioned in section 26kha(1) of the Bank Company Act, 1991. (Abu Farah Md. Nasir) Deputy Governor Bangladesh Bank