Default loans didn’t go up: Finance minister

Finance Minister AHM Mustafa Kamal today asserted that default loans at all banks did not increase in the last six months.

“If anyone claims the amount of default loan is increasing, I will not accept it,” the minister said.

He made the comments while talking to reporters after a meeting with all the chairmen of state-run banks at the planning ministry in Dhaka.

Finance Minister AHM Mustafa Kamal after taking charge said that default loans would not increase in future. But Since January 1 to June 30, the amount of total default loans increased by Tk 1,12,000 crore.

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The amount of increasing default loan was Tk 18,500 crore in the last six months, according to the sources of Bangladesh Bank.

“When I said that default loans of the banks will not rise, I also said that an exit plan will be made for this but the plan was not made effective due to legal reason,” the minister told the reporters.

“You (journalists) will not say that the amount of default loans has increased after the exit plan will be made effective,” he said.

Mustafa Kamal said the government is trying to make the exit plan effective as soon as possible.

The amount of default loans will start decreasing and businessmen will be beneficiary after the plan was executed, he added. 

BSS adds: AHM Mustafa Kamal also said that the government would not re-finance anymore to the state owned commercial banks to address their capital crunch.

“There will be no more refinancing to the banks and that’s gone. This is now the story of the past …….these banks (state owned commercial banks) will have to earn their money and pay taxes to the government. This is the final decision,” he said.

The Finance Minister said these four banks have been given some time to submit their work plan before him and they would sit again on next Sunday to further discuss on the submitted work plans.

Mentioning that the new top managements of these four banks are clearly very much skilled and if they could run their banks with their acquired knowledge and experiences considering the local and global context, then the country could expect much better in the coming years.