The government has extended the repayment period of Investment Corporation of Bangladesh’s Tk 3,000 crore loan from Bangladesh Bank by three years, aiming to support capital market stability.
The Finance Division issued an order on Monday, extending the guarantee period until May 11, 2029, from the previous deadline of May 13, 2026.
A sovereign guarantee means the government will assume responsibility for repaying the loan if ICB fails to meet its obligations.
Bangladesh Bank approved the Tk 3,000 crore loan to ICB on December 12, 2024, to strengthen its investment capacity, support the stock market and help it repay higher-cost borrowings.
The loan carries a variable interest rate.
The Finance Division attached six conditions to the extension.
It barred any changes to the original loan agreement between Bangladesh Bank and ICB and directed the corporation to repay the entire principal amount by May 11, 2029.
To ensure the facility contributes to market stability, the Financial Institutions Division will closely monitor ICB’s share transactions and portfolio restructuring activities throughout the extended period.
The order also requires ICB to prepare a time-bound and implementable business recovery plan aimed at reducing administrative expenses, lowering its growing interest burden and recovering losses incurred on its investment portfolio.
The plan must be submitted to the FID, which will regularly review its implementation.
In addition, ICB has been instructed to submit quarterly reports on its liquidity position, stock market investments and loan repayment progress to both the Finance Division and the FID.
A revised and final repayment schedule, prepared in coordination with Bangladesh Bank, must also be submitted to the Finance Division.
ICB sought the extension after the previous 18-month government guarantee expired in May this year.
The corporation, the government’s main investment arm in the capital market, currently holds investments worth around Tk 12,500 crore. However, the market value of those holdings has fallen to about Tk 8,000 crore.
ICB is also struggling with mounting liabilities, including nearly Tk 1,200 crore in unpaid accrued interest on loans taken from state-owned banks.
https://www.newagebd.net/post/economy/305320/govt-extends-icbs-tk-3000cr-loan-repayment-by-3-years