RegAlertRule · BB · 15 Oct 2018
FEPD Circular Letter No. 17: Holding collateral on behalf of non-resident lenders
Authorized Dealers (ADs) in Bangladesh are now permitted to hold collaterals on behalf of overseas bank branches, correspondents, or lenders against external loans approved by the Standing Committee on Non-Concessional Loan. This authorization extends the provisions previously applicable only to industrial enterprises and private sector entities to public sector entities accessing term borrowing under specific approval from that committee.
Foreign Exchange Policy Department
Bangladesh Bank
Head Office
Dhaka. www.bb.org.bd
FE Circular Letter No. 17 Date: 15/10/2018
Head offices/principal offices of all Authorized Dealers in Foreign Exchange in Bangladesh Dear Sirs, Holding collateral on behalf of non-resident lenders
Please refer to paragraph 13, chapter 16 of the Guidelines for Foreign Exchange Transactions (GFET)-2018, Vol.-1 in terms of which Authorized Dealers (ADs) are permitted to hold collaterals on behalf of overseas bank branches or correspondents in respect of external borrowing by industrial enterprises as approved by Bangladesh Investment Development Authority (the then Board of Investment) and Bangladesh Bank. In addition to external borrowing approved by Bangladesh Investment Development Authority and Bangladesh Bank for private sector, access to term borrowing is admissible by public sector entities subject to specific approval from Standing Committee on Non-Concessional Loan.
2. To facilitate the transactions, it has now been decided that ADs are allowed to hold
collaterals on behalf of overseas bank branches or correspondents or lenders against external loans as approved by Standing Committee on Non-Concessional Loan within the purview of the aforementioned regulations. Please bring the above instructions of this circular letter to the notice of all concerned. Yours faithfully, (Debashish Sarkar) Deputy General Manager Phone: 9530092
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