Central Bank Of Bangladesh To Monitor Quality Of Loans

Dhaka, Bangladesh (AHN) - The central bank of Bangladesh will start monitoring the quality of loans extended by commercial banks to ensure that the productive sectors are financed properly, the governor said on Wednesday.

"We will monitor the quality of loans to know which sectors are getting priority. We have asked the banks to give emphasis on the productive sectors," BB Governor Salehuddin Ahmed told reporters after a bankers meeting held in the central bank in the capital, Dhaka.

Meanwhile, credit flow to the private sector rose by 24.53 per cent to US$5.30 billion (BDT 363.27 billion) in May from 15.57 per cent to $2.91 billion (BDT 199.51 billion) of the corresponding period last year, according to the central bank statistics.

The credit flow to the private sector increased during the period due to the rise in financing mainly productive sectors and import to recover the losses by natural disasters and price hike of oil and commodities in the global market, according to central bank officials.

Ahmed also asked the bankers to take measures in line with the existing monetary policy to achieve maximum economic growth through continued expansion of credit to the productive sectors.

On 17 July, 2008, the BB declared its monetary policy for the first half of fiscal 2008-09 (FY09) that targets a real gross domestic product (GDP) at 6.5 percent and an average inflation rate at around 9.0 percent in the fiscal 2008-09.

"Creating employment by achieving expected GDP growth and poverty reduction have been given emphasis in the monetary policy," Ahmed said, while explaining the key objectives of the policy.