Country's Non-Bank Financial Institutions (NBFIs) continued to perform better despite the Covid-19 pandemic as indicators showed significant growth in deposits and disbursement of loans as well.
These financial institutions grew by Tk 1420.47 lac or 3.28 percent to Tk 4468475lac during July-September, 2020 from April-June quarter.
The increase in deposits during the quarter was due to increase in both private NBFIs and specialized NBFIs by Tk1343.78 crore or 3.19 percent to Tk 43473.01 crore and by Tk 82.50 crore or 7.48 percent to Tk1185.01 crore respectively, according to Bangladesh Bank (BB).
As the NBFIs are involved in financial business, they play very vital role in the country's development as they take deposits and lend money in line with the Bangladesh Bank's guidelines and policy," said BB's executive director and chief spokesperson Md. Serajul Islam.
He said the NBFIs have performed better in terms of collection of deposits and disbursement of loans amid Covid-19 and the central bank is extending all-out support to these financial institutions as per their needs.
Breakdown by types of deposits accounts revealed that the share of fixed deposits increased from 97.52 percent at the end of the April-June quarter, 2020 to 97.63 percent at the end of the July-September quarter, 2020. The amount of fixed deposits increased by Tk1433.00 crore or 3.40 percent to Tk 43625.85 crore at the end of July-September quarter, the BB data showed.
The share of private sector deposits was a significant majority (92.82 percent) of the total deposits at the end of the July-September quarter, 2020 and deposits in the private sector increased by Tk.1364.20 crore or 3.40 percent to Tk 41476.34 crore at the end of the quarter. Deposits in the public sector increased by Tk 56.26 crore or 1.78 percent to Tk 3208.41crore at the end of the July-September quarter, 2020 under review as compared to the preceding April-June quarter, 2020. The government deposits in the public sector increased by Tk1.47 crore 2.54 percent to Tk 59.32 crore as compared to the preceding April-June quarter, 2020.
Disbursement of loans by NBFIs also witnessed a rise as the highest 31.44 percent of the bulk of disbursements was used for ‘Industry’ purpose followed by 19.78 percent for 'Consumer Finance’ and 17.97 percent for ‘Trade and Commerce’ at the end of the July-September quarter, 2020.
Industrial loans increased by Tk 254.30 crore or 23.68 to Tk 1328.12 crore 'Consumer Finance’ increased by Tk 517.81crore or 163.06 percent to Tk 835.37 crore at the end of the quarter under review as compared to the preceding quarter April-June, 2020.
Also, the disbursements in ‘Construction’ increased by 599.25 percent to Tk 355.71crore, in ‘Agriculture’ increased by 267.33 percent to Tk 425.73 crore and in ‘Transport’ by 12.69 percent to Tk 22.38 crore as compared to the preceding April-June, 2020. Finally, in 'Others' disbursements showed an increase by 298.79 percent to Tk 497.61crore at the end of the quarter under review as compared to the preceding quarter April-June, 2020.
Credit recovery also witnessed a rise during the period as 34.54 percent of the bulk of recoveries was from ‘Industry’ sector, 25.93 percent from 'Trade and Commerce’ and 18.16 percent ‘Consumer Finance’ at the end of the July-September quarter, 2020. Recovery in Industry increased by Tk 759.63 crore or 48.68 percent to Tk 2320.15 crore, in‘Trade and commerce’ increased by Tk 266.28 crore or 18.04 percent to Tk1742.02 crore at the end of the quarter under review as compared to the preceding quarter April-June, 2020.
Besides, recovery in ‘Construction’ increased by 15.81to Tk 568.72 crore, in ‘Agriculture’ increased by 191.64 percent to Tk.369.48 crore and in ‘Transport’ increased by 84.60 percent to Tk 85.60 crore as compared to the preceding quarter April-June, 2020. And in 'Others' recoveries showed an increase by 24.18 percent to Tk 411.06 crore at the end of the quarter under review as compared to the preceding quarter April-June, 2020.
The institutions, other than deposit money banks which mainly carry out the financing business are termed Non-Bank Financial Institutions (NBFIs). It is constituted under the Financial Institutions Act, 1993.
