Bangladesh Bank Unveils New Strategy to Tackle Soaring Non-Performing Loans, Including Interest Waivers

The Bangladesh Bank has introduced a new exit strategy to address the country's escalating non-performing loans (NPLs), aiming to bring them under control within 18 months. The plan involves stronger supervision, capital restoration, restructuring for viable borrowers, quicker loan recovery through courts, emergency liquidity support, and the implementation of new banking acts. A key component of the strategy, designed to meet International Monetary Fund loan requirements, allows banks to waive interest entirely for one-time settlements, meaning defaulters would only need to repay the principal amount.