HC for continuing special facility for loan defaulters

The High Court (HC) on Sunday declared a Bangladesh Bank circular that allowed loan defaulters to reschedule their bank loans by paying 2 percent down payment, legal and ordered the central bank to extend duration of this facility for 90 more days, reports BSS. A High Court division bench comprising Justice JBM Hassan and Justice Md Khairul Alam passed the order, while disposing of a rule issued in this regard.

The court also ordered BB to form a nine-member expert committee to monitor and probe irregularities and corruption in banking sector. The High Court ordered the central bank to follow recommendations of this committee. Earlier on October 28, the High Court set today to pass its order after holding final hearing on the matter. Rights group Human Rights and Peace for Bangladesh (HRPB) filed the writ to this end.

The central bank on May 16 posted the circular on its website, allowing loan defaulters to reschedule their bank loans by paying 2 percent down payment and securing further loan in this way. But the High Court on May 21 imposed the status-quo for one month on the Bangladesh Bank circular after holding hearing on a writ petition challenging the central bank order.

The High Court on June 24 extended for two more months the status-quo. The Appellate Division of the Supreme Court on July 8 stayed for two months a High Court order that imposed a status-quo on the circular. The apex court however, put a condition saying if anyone takes the special concession, he would not be allowed to take further loan from any bank within two months.