Bangladesh Bank (BB) today relaxed the down payment requirements for exit facilities on defaulted loans of closed or loss-incurring companies.

The central bank issued a notice in this regard.

From now on, such applications can be made with only 5 percent down payment on the existing loan balance, which was previously at 10 percent.

The notice said the management authority can now approve exit facilities for loans up to Tk 20 lakh whereas previously it was Tk 10 lakh.

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Loans exceeding this amount will need approval from the board.

Bangladesh Bank on July 08 last year introduced an exit policy for businesses, industries, or projects that were established on loans but have shut down or are incurring losses due to uncontrollable factors.

The policy aimed to recover such loans within a maximum of three years through measures including interest waivers and other facilities.

Loans availing the exit facility will continue to be classified as defaulted until fully recovered.

Some modifications have been brought about in the policy, further relaxing the conditions. The revised policy states that loans availing the exit facility cannot be rescheduled or restructured.