BB gets 75 proposals involving over $353m for long-term financing

Dhaka,  Fri,  21 July 2017
Published : 13 Jul 2017, 22:20:04
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BB gets 75 proposals involving over $353m for long-term financing

Bangladesh Bank (BB) has received 75 project proposals involving about US$ 352.9 million till June 30 from the export-oriented companies to facilitate long-term financing under the World Bank-funded Financial Sector Support Project (FSSP), reports BSS.

"We have already sanctioned 43 proposals with $192.8 million of which $100.1 million of 31 proposals has been disbursed, the rest of the sanctioned amount is under the process of disbursement," a BB official told the news agency on Thursday.

Out of the total sanctioned funds, some have been disbursed partially and some more are under the process as the amounts will be disbursed through opening Letter of Credits (LCs) for importing machineries, he added.

Out of the total applications received through the commercial banks, the central bank is processing three proposals and 16 proposals have been closed by the World Bank and the BB for 'substantial impact on environment and shipping', the BB official said.

He said the BB has also declined seven proposals with $23.9 million for various reasons while six proposals with $25.5 million have been discontinued by the participating financial institutions (PFIs).

BB also refinanced five proposals with $1.328 million, he added.

"We have submitted proposals of four companies involving $34.6 million of which two companies have already been given their sanctioned funds amounting to $20.1 million," said executive vice-president of Southeast Bank Limited Abdul Baten Chowdhury.

The four companies are T-Design Knitwear Limited, SNOWTEX, Jahan Marine Private Limited and KC Jacket Wear Company.

Out of the total submitted proposals, Baten Chowdhury, also the head of Principal Branch of the bank, said two proposals have already been approved and the remaining two proposals awaits approval.

Out of the two approved proposals, senior assistant vice-president of the same bank M Roushon Ali said, T-Design Knitwear Limited has already got its sanctioned amount and imported capital machineries.

The BB under the auspices of International Development Association (IDA) of the World Bank would provide a total of $350 million under the FSSP, which would play a pivotal role in meeting the growing demand for long-term financing for productive sectors in the country.

The BB has signed separate Participating Financial Institutes (PFI) agreements with 31 banks to distribute the long-term finance among the country's export-oriented industries.

Of the total amount, the World Bank will provide $300 million and rest of the amount will come from the BB's own fund. The tenure of the project is July 1, 2015 to March 31, 2021.

Under the FSSP fund for long-term financing, the banks can lend money for ventures in the industrial productive sectors for tenures running from five to 10 years with the condition that the banks would pay interest rate between 2.50 per cent and 3.50 per cent, including the LIBOR (London Inter Bank Offered Rate) depending on the category of banks.

The interest is being fixed considering the respective bank's CAMELS (Capital, Assets quality, Management, Earning, Liquidity, and Sensitivity) rating, a recognised international rating system that bank supervisory authorities use in order to rate financial institutions.
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