Regulatory Alerts2013-11-07
Added · Updated
BRPD Circular No. 13: Write-off Policy
BRPD Circular No. 13 amends the write-off policy for non-performing loans by exempting loans and advances below 50,000 BDT from the requirement to file court cases before write-off. Scheduled banks in Bangladesh may write off these small-amount loans immediately, provided they comply with all other instructions in BRPD Circular No. 02/2003 regarding 100% provision maintenance. This directive takes effect immediately to reduce litigation costs for small loans.
BRPD Circular No. 13 Banking Regulation and Policy Department Bangladesh Bank Head Office Dhaka. November 07, 2013 BRPD Circular No. - 13 Date: ------------------- Kartik 23, 1420 Managing Director / Chief Executive Officer All Scheduled Banks operating in Bangladesh. Dear Sir, Write-off Policy. Reference is drawn to your attention to BRPD Circular No. 02, dated January 13, 2003, on the subject cited above. In the said circular, it was directed that loans and advances classified as bad/loss should be written off with 100% provision maintenance after filing a case in court. However, it has been observed that in many cases, especially in the case of small amount loans, the cost of litigation exceeds the loan amount. In this context, it has been decided that loans and advances/investments below 50,000/- (Fifty Thousand) Taka eligible for write-off may be written off without filing a case in court, subject to compliance with other instructions of BRPD Circular No. 02/2003. These instructions shall come into force immediately. Please acknowledge receipt.
Yours faithfully, (Md. Anowarul Islam) Deputy General Manager Phone: 9530094
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