Banks to charge simple interest rate: Kamal
Published: 09:17 PM, 18 March 2019
Finance Minister AHM Mustafa Kamal said that simple interest rates will be charged on all bank loans instead of present practice of compound rates to lower burden on borrowers.
“In the country, there is a practice of charging compound interest rates on bank loans, which is against global practice. Now, simple interest rate will be applied on bank loans,” kamal informed journalists after holding a meeting with board of directors of all banks and financial institutions at city’s NEC auditorium on Monday.
Kamal identified the practice as a major cause of rising non-performing loans and weak health of the financial sector.
“Businessmen have to take immense risk for starting off any business. But compound interest rate put extra burden on them which sometimes leads to collapse of their business,” he remarked.
The finance minister reiterated that special audits will be conducted in all banks and financial institutions to verify the assets mentioned in their balance sheets.
“The cracks in the banking system has now widened to an extent which calls for a quick response from the policymakers,” he stressed.
In the process, honest and bad businessmen as well as their associates will be identified to support the good ones while bringing unscrupulous ones to book.
“We shall apply our all legal jurisdiction to punish the bad businessmen and their supporters to reclaim the default loans,” Kamal warned.
He clarified that they have no intention to put them behind the bars or wholesale shutting down of their businesses so that employees of good business entities do not lose their job.
“We want to rearrange the banking sector based on a win-win situation,” he said.
Criticizing the practice of providing long-term loans against short-term deposits, the minister informed that they want to create a bond market soon for helping long-term financing.
The finance minister requested all not to come up with any kind of bank related recommendation to him.
The persons well conversant with banking and financial system will be appointed to the bank boards after taking interviews to ensure proper persons sit in the boards, he pointed out.
However, he doesn’t think that the health of the banking sector that much bad as perceived by common people.
As a new financial instrument, the government will soon introduce crop insurance in Rangpur division and haor areas to lower risk of exposure to natural disasters.
- Heat wave may spread
- World Books and Copyright Day today
- Myanmar top court rejects Reuters journalists` appeal
- Sri Lanka observes 3-min silence for bomb victims
- Updating voter list begins today
- SL blasts: 40 suspects arrested, toll up to 310
- Zayan’s body to reach home tomorrow
- 10 dead, 30 hurt as Nigeria cop rams car into crowd
- Google doodle celebrates birthday of Rosy Afsari
- PM returns home today
- Tajikistan faces Mongolia this evening
- 2 dead in road crash near Motsho Bhaban
- 1,650 metres of Padma Bridge now visible
- Murder accused Jabed killed in Ctg gunfight
- PM returns home tomorrow
- Strong earthquake hits central Philippines, killing 5
- Sri Lanka blames Islamists for Easter attacks
- Bangladesh beat UAE by 2-0
- `Not possible to ‘restore’ democracy with Khaleda in jail`
- Shakib stays back in India to play IPL
- Tigers start World Cup preparation with 5 cricketers
- Sufferings due to load-unloading trucks on road
- Walsh tips Fizz for `big role` in World Cup
- RAKUB recovers Taka 200 crore in Boishakhi Mela
- PM calls Brunei to business with Bangladesh
- Garment worker found dead in Shreepur
- Boro farmers face losses in hailstorm
- Sri Lanka imposes curfew again
- Gorillas pose for selfie with DR Congo anti-poaching unit
- PM proposes formation of new regional economic forum
- All News »
- Nusrat murder: Last accused Kader arrested
- Educational Institutes to be closed Apr 21, 22
- Stadium debate ahead of Ukraine presidential runoff
- Egypt votes in referendum to extend Sisi’s power
- ‘Pornstars name in school exam investigating’
- Probe team of police going to Sonagazi
- Bangladeshi shot dead by BSF
- Sheikh Selim’s grandson killed in SL blasts
- Water transport workers’ strike detaches Bhola
- Vicky Kaushal injured during film shoot
- Man killed in Teknaf shootout
- Hafiz Quader was active in Nusrat killing
- Journalist Zafar Wazed new PIB DG
- Probe report against Nowshaba on May 28
- Renowned director Hasibul Islam passes away
- High-fructose corn syrup boosts intestinal tumor growth in mice
- Sudan`s Bashir moved to prison as protesters rally
- 5 to die in Chapainawabganj rape case
- New identity of Porimoni
- 7 suicide attackers behind 6 SL blasts
- Nusrat murder: Suspect Moni held
- PM returns home tomorrow
- Female magistrates for testimonies of sexual assault victims
- 13 under arrest for Sri Lanka blasts: police
- Nusrat murder: Moni put on 5-day remand
- Terrorist killed in Gazipur gunfight
- 4 killed in truck-auto rickshaw collision
- Adele separates from husband
- Nusrat murder: CID searching money grantor
- Team Bangladesh on ICC’s fb cover photo