Draft a circular letter to the bank branches for taking proper cautionary measures in sanctioning house-building loans to the members of the public

Q. Draft a circular letter to the bank branches for taking proper cautionary measures in sanctioning house-building loans to the members of the public.

Agrani Bank Ltd.

Head Office, Motijheel Commercial Area

Dhaka 1000

(General Credit Division)

Telephone: 02-956 3111 Facsimile: 02-956 3222 

Email:agranigeneralcredit@agranibank.com

Circular No: 234/HBL/CAUTION/09

Wednesday, May 13, 2009

Of late, it is being observed that some of our branches have been sanctioning long-term loans for house building a bit recklessly and without taking cautionary measures as to the builder’s equity and the income generating capacity of the building being financed.

All concerned are hereby advised to strictly abide by the terms and conditions as stipulated in the Circular Number 19 dated 12 Jan 1987 while evaluating a proposal of house-building loan.

Special attention must be given to the valuation of both landed and building properties keeping in mind that in view of impending recession the present value of real estate in Bangladesh may suddenly plummet as had happened in North America that has sparked the ongoing financial meltdown all over the world.

Any deviation from instructions as enunciated in the “Loan Manual” and in circulars issued from time to time as to house-building loan will be seriously taken and meted out with stern administrative actions.

Each and every official is instructed to read this circular and put his or her signature in the blank space of this notification.

Khondoker Waliur Rahman

General Manager

Operation Wing

Copies to:

01. Staff Officer to Managing Director

02. All General Managers, DGMs and AGMs

03. All Regional Managers

04. All Managers

05. Office file