Managing the soaring non-performing loans (NPLs) in the banking sector has emerged as a big challenge, says Finance Minister AHM Mustafa Kamal.
The banks' lending rate was much higher and it was largely contributing to increasing bad loans in the banking sector, he told the media on Sunday (Dec 1) after a meeting with top officials of state-owned and private banks.
A "high-powered committee" would be formed to recommend strategies to implement single digit interest for bank loans and reduce the NPLs, Kamal said before adding: "Bangladesh Bank governor has been asked to do it. It's governor's discretion to set the members of the committee, its head and who will be included in the committee.
He said the meeting discussed the NPLs and lending rate issues with bank chairmen, managing directors and CEOs of all public and private banks to find ways to reduce NPLs and lower the lending rate to 9 percent.
Mustafa Kamal said NPLs would be reduced at the end this month.
Bangladesh Bank Governor Fazle Kabir told the media briefing that a seven-member committee, headed by a deputy governor, would be formed.
He said chairmen of private and public banks, representatives of financial institution division and finance division, would also be included in the committee.
"The committee will be formed today (Sunday). The committee will place its report by next seven days," Kabir said.