FARM LOAN disbursement
12 banks reach below 60pc of target in 11 monthsAKM Zamir Uddin
Twelve commercial banks disbursed below 60 per cent of their annual target of agriculture loans in the first 11 months of the current financial year.
Bangladesh Bank officials told New Age on Thursday that they would take punitive action against the commercial banks which would not be able to fulfil their annual farm loan disbursement target in the current financial year.
A BB official said, ‘We have repeatedly warned banks that the central bank will cut the non-disbursed farm loan amount of money of the commercial banks which is reserved as deposit money of the banks in the BB fund at the end of the FY2011-12.’
According to the BB data released last week, the banks, which disbursed below 60 per cent in farm loans of their annual target, are — Rupali Bank 22.37 per cent, Standard Chartered Bank 34.48 per cent, National Bank of Pakistan 0.53 per cent, Premier Bank 12.08 per cent, Dhaka Bank 41.29 per cent, EXIM Bank 52.98 per cent, First Security Islamic Bank 25.31 per cent, Jamuna Bank 10.13 per cent, Prime Bank 32.14 per cent, Southeast Bank 10.20 per cent, Standard Bank 32.53 per cent and United Commercial Bank 39.29 per cent.
If any bank fails to fulfil the target, the non-disbursed amount will be brought to the central bank and the bank will get an interest of 5 per cent for the amount, said the official.
Under the BB rules and regulations, the commercial banks have to disburse at least 2 per cent loan in the agriculture sector of their total credit distribution in a year, he said.
A senior official of a commercial bank said farm loan disbursement rate this financial year had decreased because of overall liquidity crisis in the banking sector.
Moreover, a number of banks are still reluctant to disburse loans among the farmers, as the interest rate on farm loan was only 13 per cent while the existing interest rate on deposits was over 12 per cent, he said.
On the other hand, the banks are charging high interest rate on the credit for small and medium enterprise sector, consumer loan and industrial term loans.
In the first eleven months of the FY 2011-12, the country’s private commercial banks disbursed only Tk 964.54 crore, or 59.50 per cent of their annual target of Tk 1,621 crore.
The overall loan disbursement by banks in the agriculture sector is yet to be reached at a satisfactory level, another BB official said.
The state-owned, private and foreign commercial banks and specialised banks from July to May of the FY 2011-12 collectively disbursed Tk 11,453.01 crore, or 82.99 percent in farm loans against the annual disbursement target of Tk 13,800 crore.
The agricultural loans disbursement by the banks in the same period of the previous financial year totalled at Tk 10,533.48 crore, or 88.92 per cent of the annual target of the agricultural credits Tk 11,846.40 crore, showed the BB data.
The state-owned commercial banks — Sonali, Rupali, Agrani and Janata — and the two specialised banks — Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank — in the first eleven months of this financial year disbursed Tk 7,516.26 crore or 88.32 per cent of their annual disbursement target of Tk 8,510 crore.
During the same period of the previous financial year, the SCBs and specialised banks disbursed Tk 7,791.74 crore, or 94.85 per cent of their annual agriculture loan disbursement target.
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