United News of Bangladesh

The Association of Bankers, Bangladesh (ABB), an organisation of bank executives, has called for greater flexibility in setting service fees and an increase in loan limits for housing and car purchases. ABB representatives placed their demands at a meeting on Monday chaired by Bangladesh Bank Governor Dr Ahsan H Mansur. Senior central bank officials were also present. The association proposed raising the maximum home loan limit to Tk 5 crore and increasing the loan-to-value ratio for buying cars and flats to 90 percent. According to central bank sources, the ABB had submitted these proposals in writing over several months, prompting Bangladesh Bank to arrange the meeting. While the central bank agreed in principle to some proposals, it rejected others to protect customer interests. Some decisions from the meeting are expected to be announced soon through a circular. The proposals included calls to digitise all transactions to eliminate delays in deposits, simplify the process for banks to raise capital through Tier-2 bonds, and introduce more flexible classification and provisioning policies for loans to the Cottage, Micro, Small, and Medium Enterprise (CMSME) sector. ABB also urged that banks be allowed to write off loans that have been non-performing for one year and requested additional time to adjust the excess portion of revolving loans, with the possibility of renewal until December. Farmers forced to take high-interest loans under syndicate pressure: CAB chief The association further sought the removal of fixed service charges, allowing banks to determine their own fees, and full permanent address verification using national identity cards during account opening. Besides, it proposed raising the home loan limit to Tk 5 crore, increasing the loan-to-value ratio to 90 percent, removing the loan limit for purchasing hybrid cars with up to 90 percent financing, and setting maximum limits of Tk 40 lakh for personal loans and Tk 50 lakh for credit cards. ABB Chairman and City Bank MD Masrur Arefin, along with managing directors of several banks, including Abul Kashem Md Shirin of Dutch-Bangla Bank, Mohammad Ali of Pubali Bank, Hasan O Rashid of Prime Bank, Ali Reza Iftekhar of Eastern Bank, Syed Mahbubur Rahman of MTB, Sohel RK Hossain of Bank Asia, and Naser Ezaz Bijoy, CEO of Standard Chartered Bangladesh, among others, attended the meeting.