BB governor dismisses loan default allegations

Bangladesh Bank Governor Md Mostaqur Rahman today dismissed allegations that he is a loan defaulter, saying the claim is false despite being repeated several times.

He made the remarks in response to a question at the finance minister’s post-budget briefing held at the Osmani Memorial Auditorium in the capital.

Rahman said that before becoming governor, he had been involved in running a factory. While loan repayments can be delayed for various reasons, that does not automatically make someone a loan defaulter.

"To this day, that factory has never been shut down for a single day. Not once has it delayed paying workers' salaries by even a month. Not once has it asked a bank to waive a single taka of its loan," he said.

The governor said the factory had initially received financing under the Financial Sector Support Project (FSSP) at an interest rate of 4 percent.

However, after investing Tk 150 crore, the company was informed that the fund had been exhausted and that the applicable interest rate would instead be between 9 percent and 11 percent.

"As a result, repayments did not proceed according to the original projections. There were delays, and this coincided with the Covid-19 pandemic and other challenges," he said.

"However, you can be assured that we never sought the waiver of even a single paisa or taka. In fact, the company has already repaid more than Tk 100 crore in bank loans," Rahman said.

"Sometimes, repeating a false claim over and over can make it appear true," he added.