United News of Bangladesh

Bangladesh Bank (BB) has extended special loan rescheduling and restructuring facilities for the borrowers of non-bank finance companies until September 30, 2026, aiming to help struggling businesses recover, reduce non-performing loans (NPLs), and improve liquidity in the financial sector. According to a circular issued on Thursday by the central bank’s Finance Company Regulation and Policy Department (FCRPD), this policy support is aligned with the benefits previously granted to the clients of commercial bank companies. Under the new directive, finance companies can now provide special rescheduling and restructuring facilities for affected borrowers based on the financial institution-client relationship. The facilities will be guided by the instructions issued under BRPD Circular No. 07 (dated September 16, 2025), BRPD Circular Letter No. 26 (dated November 24, 2025), and BRPD-1 Circular Letter No. 16 (dated May 7, 2026). The central bank emphasised that finance companies must ensure compliance with the provisions of the Finance Company Act, 2023, and relevant department circulars while executing these facilities. The entire process, including receiving applications from affected borrowers and obtaining official approval from the respective finance company's Board of Directors, must be completed by September 30, 2026. The BB stated that this initiative is part of its ongoing efforts to assist viable but financially distressed businesses, enabling them to return to profitable operations, which in turn will secure loan recovery for the financial institutions. The move is also expected to inject momentum into the country's overall economic activities.

Bangladesh Bank has introduced a structured framework to govern import transactions into Free Trade Zones (FTZs), aiming to facilitate trade while ensuring prudent risk management by banks, according to a circular issued on Thursday. The Foreign Exchange Policy Department-1 (FEPD-1) circular directs all Authorized Dealers (ADs) and Offshore Banking Units (OBUs) to follow the new instructions when providing financial services for FTZ-related transactions, in line with existing foreign exchange regulations. Under the framework, imports into FTZs can be undertaken by industrial enterprises engaged in manufacturing or export-oriented production, authorized importers on record, and licensed logistics service providers operating within the zones. Goods brought into FTZs for storage, warehousing or distribution may be imported on a consignment basis, with ownership remaining with foreign suppliers until the goods are either used in production or sold to ultimate buyers. For financing and exposure purposes, banks will not treat such goods as owned inventory of FTZ enterprises until either event occurs. The circular also sets out rules for purchase and sale transactions. Purchases of goods from FTZs by buyers in Bangladesh, including those in specialized zones or other FTZs will be treated as import transactions requiring standard IMP formalities. Where such purchases involve industrial raw materials, usance import facilities of up to 270 days will be permitted under FE Circular No. 51 of December 29, 2025. Sales of finished or semi-finished goods by FTZ enterprises to buyers in Bangladesh will be treated as export transactions for sellers and import transactions for buyers, with both EXP and IMP procedures to be followed accordingly. All such payments must be settled in freely convertible foreign currency, though FTZ enterprises may retain sale proceeds in designated foreign currency margin accounts for onward settlement of import obligations abroad. On tenor, goods imported into FTZs under consignment arrangements may remain in the zone for 48 to 60 months, subject to regulatory compliance, while usance import transactions, including those backed by buyer's or supplier's credit will carry a maximum tenor of 270 days. The circular further allows ADs to extend financing to FTZ entities in a manner similar to facilities available to enterprises in specialized zones. However, for consignment-based imports, ADs and OBUs will not recognise or assume exposure on FTZ entities for goods where ownership remains with the foreign supplier, such consignments will only be recognised as imports once ownership transfers through production use or sale, supported by documentation including a bill of entry. For usance imports, ADs may arrange buyer's or supplier's credit facilities with a tenor not exceeding 270 days, while OBUs may provide such financing in foreign currency. On risk management, the central bank instructed that all admissible financing be backed by appropriate documentation aligned with underlying transactions, and directed ADs and OBUs to conduct due diligence on FTZ clients, including assessing contracts with foreign suppliers and buyers, verifying ownership structures, and evaluating production and sales cycles. Banks have been asked to bring the contents of the circular to the notice of relevant stakeholders.

Widespread concern and dissatisfaction have spread among common people regarding banks following a proposal that could require customers to pay additional fees to withdraw their own money from bank counters. The Association of Bankers, Bangladesh (ABB), an organization of bank executives, has proposed that if a customer withdraws cash from a bank counter more than three times a month, an additional fee ranging from Tk 100 to Tk 300 could be charged for each subsequent transaction. The association has also recommended introducing new fees for 14 other types of banking services and increasing several existing charges. These recommendations include a Tk 500 fee to reactivate long-dormant bank accounts and a multi-fold increase in loan processing fees. Banks have justified the move by citing rising operational costs and noting that such fees are standard practice internationally. They also argued that the initiative aims to encourage customers to minimize counter-based transactions and utilize ATMs, mobile banking, and internet banking instead. However, analysts and customers argue that the reality is not that simple. Amid high inflation affecting essential goods, medical care, education, and transportation, an additional fee on cash withdrawals would disproportionately burden the middle class, low-income individuals, retirees, and small businesses. Many elderly individuals and pensioners are not accustomed to digital banking and remain heavily dependent on bank counters. Furthermore, critics highlighted significant shortcomings in the alternative digital infrastructure, noting that: Sufficient ATM booths are still not available across all regions of the country. Customers frequently face harassment due to booths running out of cash or experiencing technical glitches. Mobile and internet banking services are not yet equally accessible to everyone, particularly in rural areas and small towns where many lack smartphones or comfort with digital services. Customers have questioned why banks are raising charges without addressing persistent issues like long queues, server complications, and delayed services. They warned that continuous hikes in fees could damage public trust in the formal banking system, prompting some to keep cash at home instead, which is not positive for the formal financial sector. Amid these growing anxieties, the central bank has taken a cautious stance, clarifying that it will not easily approve any decision that imposes an unreasonable financial burden on customers. Bangladesh Bank Spokesperson Arif Hossain Khan said, "Imposing extra fees could create a reluctance among the general public towards banking services.” Therefore, the interests of the customers will be given the highest priority before any decision is made, he said. He added that the central bank has advised banks to focus on increasing their revenues through loan disbursement, investments, and regular banking operations rather than solely relying on service fees. The ABB proposal currently remains a mere recommendation and cannot be implemented without formal approval from Bangladesh Bank. However, the intense public reaction underscores that citizens, squeezed by a rising cost of living, are deeply uncomfortable with the prospect of new banking charges.

Bangladesh Bank has introduced a special one-time exit facility to help finance companies recover or adjust their classified bad and loss loans, as part of efforts to shore up asset quality and liquidity in the sector. The central bank's Finance Company Regulation and Policy Department (FCRPD) issued the directive on Thursday, addressed to managing directors and chief executive officers of all finance companies operating in the country. BB eases external borrowing rules for foreign-owned industries The circular noted that borrowers across businesses, industries and projects have faced difficulties due to various uncontrollable economic factors, with some enterprises shutting down or turning loss-making. This has disrupted loan recovery for finance companies, prompting the central bank to allow a one-time settlement route for willing borrowers whose chances of regularising loans through the normal process have weakened. Under the policy, finance companies may offer the special exit—subject to board approval to customers holding loans classified as bad or loss as of June 30, 2026, based on the institution's relationship with the borrower. Key conditions set out in the circular include: Borrowers opting for the facility must clear their entire outstanding liability in a single, one-time payment. According to the circular, the principal amount of the loan cannot be waived, though interest may be waived after verification and selective scrutiny. Where relaxation of fund utilisation conditions or income-sector deviation is required for an interest waiver, the justification must be confirmed through the finance company's internal audit function, with an opinion obtained from the Head of Internal Control and Compliance (HICC). Besides loans involving fund diversion, fraud, forgery or other irregularities in disbursement will not qualify for the exit facility. Loss-classified loans that were rescheduled between August 6, 2024 and June 30, 2026 will be eligible under this circular. Priority in granting the special exit will go to short-term agricultural loans and cottage, micro and small loans under the CMSME sector. Finance companies have been instructed to notify eligible borrowers in writing about the facility and take other necessary steps to implement it. The circular will remain in force until December 31, 2026, and has been issued under the powers vested in Bangladesh Bank by Section 41 of the Finance Company Act, 2023, effective immediately.

A meeting of the Board of Directors of Islami Bank Bangladesh PLC was held at the Islami Bank Tower in the capital on Wednesday. The meeting was presided over by Mohammad Zahir Hussain, executive director of Bangladesh Bank and the sole representative of the board of directors. Md Altaf Hossain, acting managing director, and Md Habibur Rahman, company secretary of the bank, also attended the session. BB eases external borrowing rules for foreign-owned industries Zahir Hussain has been temporarily overseeing the bank's board as its sole statutory representative under the central bank's authorisation to maintain the financial institution's operational stability and ensure uninterrupted services during the transition period.

Bangladesh Bank has handed the management of Al-Arafah Islami bank back to its former owners.  As per the central bank directive, 14 new entrepreneur-shareholders were inducted into the bank's board of directors on Wednesday (July 15). Bangladesh Bank Executive Director and Spokesperson Arif Hossain Khan confirmed the information to UNB. Since August 2024, the bank had been functioning under a five-member body of independent directors. With the inclusion of these 14 individuals, the total number of directors now stands at 19. During the Awami League regime, Abdus Samad Labu, brother of S. Alam served as the chairman of Al-Arafah Islami bank. The central bank spokesperson stated that among the 16 banks whose boards were previously dissolved by the BB, Al-Arafah Bank’s financial condition has shown improvement, prompting the reinstatement of its shareholder-directors. He noted that while the entrepreneurs of other dissolved banks could not be traced, the situation was different for Al-Arafah Bank, which is why it has been handed back to them. Among the 14 new board members, three are from the KDS Group. They are KDS Group Chairman Khalilur Rahman, KDS Garments representative director Mahbub Ahmed, and KDS Textile representative director Farid Uddin Ahmed. The other directors included in the board are the bank’s former chairman Bodiur Rahman, Enayet Ullah (who contested the last election from Dhaka-7 representing Jamaat), Selim Rahman, Ahamedul Haque, Rafiqul Islam, Imadur Rahman, Nazmul Ahsan Khaled, Anwar Hossain, Abdus Salam, Liakat Ali Chowdhury, and Sharif Uddin Taslim, representing KY Steel Mills. Following the fall of the Awami League regime, the central bank dissolved the board of Al-Arafah Islami Bank and appointed Khaja Shahriar as an independent director and chairman of the board. The other independent directors on the board—Md. Shahin Ul Islam, Md. Abdul Wadud, M. Abu Yusuf, and Mohammad Ashraful Hasan—will also remain on the new board. Moving forward, all members of the newly formed board will collectively appoint a new chairman.

Bangladesh Bank has granted general permission for fully foreign-owned industrial enterprises, operating both within and outside specialised economic zones, to borrow directly from their parent companies, associates, or shareholders abroad, in a move aimed at easing access to finance for foreign investors. The central bank's Foreign Exchange Investment Department (FEID) issued the directive through FEID Circular on Wednesday revising earlier provisions under FE Circular No. 34 of September 2, 2025, which governed external borrowing by such enterprises. Under the new provisions, foreign-owned manufacturing and service enterprises outside specialised zones such as EPZs, PEPZs, EZs and HTPs can now avail short-term borrowing of less than one year without prior Bangladesh Bank approval, provided the funds are used for genuine business purposes. The circular allows two options for such borrowing-enterprises may take interest-free loans for general working capital needs, excluding input procurement, with no central bank clearance required even for principal repayment. Alternatively, they may opt for cost-bearing loans in convertible foreign currencies, including for input procurement, but the all-in cost of such borrowing must not exceed 3 percent per annum. These loans must be repaid in a single bullet payment at maturity and may be rolled over, provided the total tenor, including rollovers, does not exceed three years from the date of initial drawdown. Such short-term facilities cannot be converted into medium or long-term loans. Authorized Dealers (ADs) have been directed to report all such transactions to the FEID within one week of execution, in addition to routine reporting requirements.

Bangladesh Bank has made prior approval from the Chief Inspector of Boilers mandatory for the import of boilers and boiler components, in line with a directive from the Ministry of Industries. The central bank's Foreign Exchange Policy Department issued a notification on Tuesday, instructing authorised dealer (AD) branches of all banks engaged in foreign exchange transactions to comply with the new requirement. The notification said the fresh directive follows a memo issued by the Boiler Wing of the Ministry of Industries on June 28, 2026, and has been made effective for all boiler and boiler component imports accordingly. According to the notification, boiler manufacturers must complete construction within a maximum of 12 months from the date of drawing and design approval. Manufacturers must also hand over all documents and certificates required for registration to the buying entity after supply or sale of a boiler, and must inform the Chief Inspector of Boilers in writing of the buyer's name and address. The directive further requires that occupational health and safety of factory workers be ensured, with all relevant provisions of existing labour law to be followed. Under the new instructions, prior approval from the Chief Inspector of Boilers must be obtained through a prescribed application form before any import of boilers or boiler components. On receipt of an application, a designated officer will verify the necessary documents and submit a report to the Chief Inspector, who will grant or reject the import approval after reviewing the report. If approved, the Deputy Chief Inspector of Boilers will issue the approval letter. If an application is rejected, the applicant must be informed in writing of the reasons within seven working days, after which they may reapply upon rectifying the deficiencies and paying the requisite fee. The notification added that the concerned authority may also inspect a manufacturer's factory or production process, if required, to ensure the quality of boilers.

Bangladesh Bank (BB) has exempted Shinepukur Ceramics Limited from a specific restrictive provision allowing the company to open Letters of Credit (LC) with a 100 percent margin through Sonali Bank PLC to import essential raw materials. The central bank issued an official directive on Tuesday (July 14), signed by Deputy Governor Dr. Md. Kabir Ahmed and circulated by Director Md. Bayazid Sarker of the Banking Regulation and Policy Department-2, notifying the top executives of all scheduled banks across the country. Bangladesh Bank declared that the restrictions under Section 27 Ka(3) of the same act will remain suspended for Shinepukur Ceramics Limited until December 31, 2027. The central bank noted that the special regulatory waiver has been granted strictly on humanitarian and economic grounds to ensure the continuity of the factory’s industrial production and to protect the employment of its massive workforce. However, the apex bank attached strict conditions to safeguard the state-owned lender's funds: Designated Account Tracking: Shinepukur Ceramics Limited must deposit all its operational and business income into a single, specific designated bank account. Proportionate Debt Clearance: Sonali Bank PLC must regularly recover its outstanding dues from that specific account on a proportionate basis. Zero State Liability: The central bank explicitly clarified that no financial liability or obligation will be passed on to the Finance Division or Bangladesh Bank against this special credit facility. No Future Bailouts: The directive strongly stated that Sonali Bank PLC, the Government, or any involved entity cannot claim any financial assistance or bailouts from Bangladesh Bank regarding this arrangement in the future.

Finance Minister Amir Khosru Mahmud Chowdhury on Sunday informed Parliament that the total amount of default loans in nine state-owned banks stood at Tk 188,701.75 crore as of May 31 this year. Replying to a question from reserved seat Jamaat-e-Islami MP Sabikun Nahar during the question-answer session, the minister said the figure was based on data submitted by the banks to the Credit Information Bureau (CIB) database of Bangladesh Bank. The minister said the nine state-owned banks are Agrani Bank, Janata Bank, Rupali Bank, Sonali Bank, BASIC Bank, Bangladesh Development Bank, Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank and Probashi Kallyan Bank. He said reducing the high level of default loans is essential to restoring discipline in the country's banking sector. Responding to a question from Jamaat MP Golam Rasul, the finance minister said the government's total outstanding debt stood at Tk 2,206,462 crore as of December 31. Of the total, external debt amounted to Tk 959,311 crore, while domestic debt stood at Tk 1,247,151 crore. Answering another question from Jamaat MP Shahjahan Chowdhury, Amir Khosru said the government repaid foreign loans worth US$4.65 billion during the 2025-26 fiscal year. Of the total, US$3 billion was repaid as principal and US$1.65 billion as interest. In reply to a question from Jamaat MP Mahbubul Alam, the minister said Bangladesh Bank has taken several initiatives to provide easier access to loans for young entrepreneurs. He said the central bank has increased the refinancing fund for new entrepreneurs in the cottage, micro and small enterprise sector from Tk 100 crore to Tk 500 crore. Under the scheme, new entrepreneurs can obtain collateral-free loans of up to Tk 10 lakh at a maximum interest rate of 7 percent, while loans of up to Tk 35 lakh are available against collateral. Replying to a question from reserved seat MP Nilufar Chowdhury Moni, the minister said outstanding customs duties and taxes on imported goods collected by various customs houses under the National Board of Revenue over the past five years amounted to Tk 25,504.3 crore. He added that out of Tk 3,912 crore payable by Bangladesh Petroleum Corporation, Chattogram Custom House had recovered Tk 590 crore by June this year. Responding to a question from Dhaka-18 MP SM Jahangir Hossain, the finance minister said the government had decided to waive agricultural loans of up to Tk 10,000, including interest, for farmers across the country covering crops, livestock, fisheries and other agricultural activities. Under the programme, banks had received Tk 1,352.74 crore from the government by July 2 to settle dues for 1,434,482 farmers, he said. In reply to Nilphamari-4 MP Abdul Muntakim, the minister said Bangladesh Bank's regulations stipulate that a bank's fixed assets cannot exceed 30 percent of its paid-up capital. As Sonali Bank's fixed assets are already significantly higher than the prescribed limit, the bank is currently unable to purchase additional fixed assets or construct new buildings, he added. Answering a question from Cumilla-9 MP Abul Kalam, the finance minister said discussions between the Economic Relations Division and the World Bank are underway to prepare the financing pipeline for the 2026-27 fiscal year. He said budget support remains one of the World Bank's financing instruments for Bangladesh, and the government's requirement and target for such support in FY2026-27 will be determined following consultations with the relevant stakeholders. The government will decide the sectors in which any budget support funds will be utilised based on national priorities.