BRPD Circular Letter No. 53: Enhancement of working capital facilities under stimulus packages for industrial and service sector companies affected from the Novel Corona Virus (COVID-19) outbreak

Ref No: BRPD-Circular-53 Banking Regulation and Policy Department Bangladesh Bank Head Office Dhaka. 29 October 2020

BRPD Circular Letter No.-53 Date: -------------------- 13 Kartik 1427

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

Dear Sir,

Regarding the enhancement of working capital facilities for institutions in the industrial and service sectors affected by the outbreak of the Novel Corona Virus (COVID-19).

We draw your attention to BRPD Circular No.-08 dated April 12, 2020, related circular letters on this subject, and BRPD Circular Letter No.-50 dated October 01, 2020.

2. To counter the potential economic impact of the Novel Corona Virus (COVID-19) in Bangladesh, revive economic activities in the country, keep workers and employees engaged, and maintain the competitiveness of entrepreneurs, the Honorable Prime Minister announced a financial assistance package of 30,000 crore Taka for loans/investment facilities as working capital for institutions in the industrial and service sectors affected by the outbreak on April 05, 2020. Subsequently, the financial assistance package for paying the salaries and allowances of workers and employees in active export-oriented industries for July 2020 was increased by 3,000 crore Taka, raising it to 33,000 crore Taka. Currently, the financial assistance package announced by the Honorable Prime Minister for loans/investment facilities as working capital for institutions in the industrial and service sectors affected by the outbreak has been increased from 33,000 crore Taka to 40,000 crore Taka.

3. In light of the fact that domestic-owned industrial units, as well as foreign-owned and joint-venture industrial units operating in the country, have been affected by the Novel Corona Virus (COVID-19), it has been decided in this meeting to enhance the financial capacity of these units to keep production and business operations ongoing. Accordingly, 7,000 crore Taka allocated under this package will be applicable for providing loans/investment facilities as working capital to 'A', 'B', and 'C' type industrial units located in the Bangladesh Economic Zone Authority (BEZA), Bangladesh Export Processing Zones Authority (BEPZA), and Bangladesh Hi-Tech Park. The interest rate on such loans/investments will be 9%, of which the government will pay 4.50% as subsidy.

In this regard, the terms of BRPD Circular No.-08/2020, BRPD Circular Letter No.-50/2020, and related circular letters shall be followed.

4. To ensure the smooth implementation of the program regarding the provision of loans/investment facilities as working capital from the aforementioned facilities, instructions are given to submit the information according to Annexure Table-A, along with a soft copy, to the Banking Regulation and Policy Department of Bangladesh Bank by 4:00 PM on November 05, 2020. (Email: brpd@bb.org.bd and brpd.policy@bb.org.bd).

5. These instructions are issued under the powers conferred by Section 45 of the Bank Companies Act, 1991.

These instructions shall come into force immediately.

Yours faithfully,

(Md. Nazrul Islam) General Manager Phone: 9530252

Table-A Status of loans/investments provided as working capital to 'A', 'B', and 'C' type industrial units located in BEZA, BEPZA, and Bangladesh Hi-Tech Park as of 30/06/2020, and the amount of demand for providing loans/investment facilities from the aforementioned stimulus package: (In Crore Taka)

Bank Name Status of loans/investments provided as working capital to 'A', 'B', and 'C' type industrial units as of 30/06/2020 Amount of demand for providing loans/investment facilities as working capital from the aforementioned stimulus package