Economic Reporter :
Bangladesh Bank (BB) has cut the interest rate for the Long Term Financing Facility (LTFF) under the Financial Sector Support Project (FSSP).
Under the FSSP fund for long-term financing, the banks can lend money for ventures in the industrial productive sectors for tenures of five to 10 years, under the condition that the banks would pay interest rate between 2.50 percent and 3.00, including LIBOR (London Inter Bank Offered Rate) depending on the category of banks, the central bank in a circular said on Wednesday.
Earlier the rate was 2.50 percent to 3.50 percent including LIBOR.
The interest is being fixed considering the respective bank’s CAMELS (Capital, Assets quality, Management, Earning, Liquidity, and Sensitivity) rating, a recognized international rating system that bank supervisory authorities use in order to rate financial institutions.
Banks having CAMELS Rating of 1 (One) can lend money by 2 percent interest including LIBOR for five year tenure, 2.25 percent interest including LIBOR for seven years tenure and 2.50 percent interest including LIBOR.
Banks having CAMELS rating of 2 (Two) can lend money by 2.25 percent interest including LIBOR for five year tenure, 2.50 percent interest including LIBOR for seven years tenure and 2.75 percent interest including LIBOR.
Banks having CAMELS rating of 3 (Three) can lend money by 2.50 percent interest including LIBOR for five year tenure, 2.75 percent interest including LIBOR for seven years tenure and 3.00 percent interest including LIBOR.
Bangladesh Bank (BB) has cut the interest rate for the Long Term Financing Facility (LTFF) under the Financial Sector Support Project (FSSP).
Under the FSSP fund for long-term financing, the banks can lend money for ventures in the industrial productive sectors for tenures of five to 10 years, under the condition that the banks would pay interest rate between 2.50 percent and 3.00, including LIBOR (London Inter Bank Offered Rate) depending on the category of banks, the central bank in a circular said on Wednesday.
Earlier the rate was 2.50 percent to 3.50 percent including LIBOR.
The interest is being fixed considering the respective bank’s CAMELS (Capital, Assets quality, Management, Earning, Liquidity, and Sensitivity) rating, a recognized international rating system that bank supervisory authorities use in order to rate financial institutions.
Banks having CAMELS Rating of 1 (One) can lend money by 2 percent interest including LIBOR for five year tenure, 2.25 percent interest including LIBOR for seven years tenure and 2.50 percent interest including LIBOR.
Banks having CAMELS rating of 2 (Two) can lend money by 2.25 percent interest including LIBOR for five year tenure, 2.50 percent interest including LIBOR for seven years tenure and 2.75 percent interest including LIBOR.
Banks having CAMELS rating of 3 (Three) can lend money by 2.50 percent interest including LIBOR for five year tenure, 2.75 percent interest including LIBOR for seven years tenure and 3.00 percent interest including LIBOR.
