BB guideline on lending eases

Banks are allowed to provide loans without maintaining internal credit risk rating system (ICRRS) to the cottage, micro, small and medium enterprise (CMSME) sector under the Tk 200-billion stimulus package. The government has recently announced the bailout package for the sector with an intent to help the stakeholders overcome the Covid-19 fallout. The Bangladesh Bank (BB) has relaxed the guideline, allowing banks to disburse package loans on the basis of bank-customer relationship, according to a notification issued on Tuesday. All the scheduled banks are eligible to provide loans without following ICRRS only for the stimulus package to help such businesses resume quickly. Similar relaxation was given to the banks on May 10 for providing loans to large industries and services companies under the Tk 300-billion government package. Meanwhile, the central bank has formed a Tk 100-billion new refinance scheme to help banks implement the Tk 200-billion working capital package for CMSME. On April 05, Prime Minister Sheikh Hasina unveiled a Tk 200-billion stimulus package for CMSME to cope with the impacts of the novel coronavirus pandemic.

Source: https://today.thefinancialexpress.com.bd/first-page/bb-guideline-on-lending-eases-1589304450

Q4 incentives released for exporters

The government has released the fourth installment of cash incentives amounted to Tk 4.0 billion for disbursement among the exporters for the outgoing fiscal year. The money will be distributed among the exporters for April-June 2020, according to a notice issued by the ministry of finance on Monday. Of the amount, the jute and jute products subsector will get Tk 1.01 billion while other sectors will receive the remaining Tk 2.99 billion. The Tk 2.99 billion support included the special 1.0 per cent incentives for the readymade garment sector, said the notice. At present, cash incentives are provided against shipments of products under 37 categories, including one per cent additional special incentive for apparel products. Other categories include export-focused apparel manufacturing, frozen food and fish, leather goods, and agro-processing products.

Source: https://today.thefinancialexpress.com.bd/stock-corporate/q4-incentives-released-for-exporters-1589296984

BB lets foreign firms bring in emergency funds from abroad

The central bank has relaxed regulations for foreign firms operating in Bangladesh such that they can bring in short-term working capital from abroad to tide them over during the pandemic, which has choked off their cash flows. The move comes after Naoki Ito, the Japanese ambassador to Bangladesh, last month requested the central bank. The Japanese companies like the local ones have to keep paying salaries of their employees and bear other overhead costs according to local rules and regulations, Ito wrote in a letter to Bangladesh Bank Governor Fazle Kabir on April 29. In response, the BB on May 3 issued a notice facilitating the foreign companies to bring in funding from aboard. The loans should be used to meet the actual needs for payment of three months’ wages and salaries to the staff regardless of their length of engagement in the manufacturing or services output activities. The BB decision to allow foreign firms to borrow from abroad under relaxed conditions will smooth out the flow of foreign direct investment into Bangladesh, said Ahsan H Mansur, executive director of the Policy Research Institute. But the parent companies of the borrowers should act as the guarantor of the loans.

Source: https://www.thedailystar.net/business/news/bb-lets-foreign-firms-bring-emergency-funds-abroad-1902142