Term Loan Agreement in Bangladesh: Key Clauses, Syndication, Security and Retail Lending Rules for 2026

Term loan agreement Bangladesh: what borrowers sign in 2026

A term loan agreement Bangladesh banks put in front of a borrower is rarely negotiated as hard as it should be. The sanction letter arrives with a price and a security list, the facility agreement follows on the bank's standard form, and most borrowers sign both on the assumption that the terms are fixed. They are not. Pricing mechanics, fees, covenants, events of default and the link to Bangladesh Bank's loan classification rules all have room for negotiation, and each one decides how much freedom the borrower keeps when trading turns difficult.

This guide works through the agreement clause by clause and then follows the same logic into the other finance documents Bangladeshi businesses and households sign: syndicated facilities, hypothecation agreements over movables, acquisition financing for share purchases, housing finance and consumer credit. It reflects the post-SMART interest regime, the May 2026 penal interest cut, the relaxed single-borrower limits, the January 2026 home loan ceilings and the new digital lending products. Where a TRW guide already covers a topic in depth, we link to it rather than repeat it.

Summary: A Bangladeshi term loan is documented in a sanction letter, a facility agreement and a set of charge documents. Interest has been market-based since SMART was withdrawn in May 2024, penal interest is capped at 0.5 per cent from May 2026, and an overdue instalment drives the whole loan through Bangladesh Bank's classification ladder. Syndicated, acquisition, housing and consumer facilities add their own regulatory limits on top.

Key point: The sanction letter must say whether the rate is fixed or variable and, if variable, the maximum number and size of increases in a year. A term loan agreement Bangladesh borrowers sign that is silent on those limits does not meet BRPD Circular No. 10 of 2024, and that gap is the borrower's best lever in any repricing dispute.

At a glance

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Table of Contents

How a term loan agreement Bangladesh banks use is put together

A term loan is money advanced for a fixed period and repaid in scheduled instalments, typically to fund plant, machinery, buildings or a project. In Bangladesh the contractual package has three layers. The sanction letter records the commercial deal: amount, purpose, tenor, rate, fees, repayment schedule, security and conditions. The facility agreement, or loan agreement, turns those terms into enforceable obligations and adds representations, covenants, events of default and boilerplate. The charge documents, mortgages, hypothecation deeds, guarantees, post-dated cheques and powers of attorney, give the lender something to enforce against.

Which document wins

Most bank forms used for a term loan agreement Bangladesh borrowers sign say the facility agreement prevails over the sanction letter, but many sanction letters are drafted later, by a different team, and add conditions the agreement never mentions. Read the two together and insist that any conflict is resolved expressly. Where the bank has accepted a concession during negotiation, a lower fee, a longer grace period or a looser covenant, it must appear in the signed documents, not in an email from the relationship manager.

What this guide adds

Our guide to bank loan laws in Bangladesh covers eligibility, single-borrower rules, guarantees and rescheduling, and our guide to loan security documentation covers mortgages, stamp duty and perfection. This article concentrates on the clauses: what a term loan agreement Bangladesh borrowers sign should say, what to push back on, and how the same thinking applies to syndicated, acquisition, housing and consumer facilities.

Interest, fees and pricing clauses after SMART

The interest clause is the one most borrowers read and the one they most often misunderstand. The SMART reference rate was introduced as an interim measure in June 2023 and withdrawn on 8 May 2024 by BRPD Circular No. 10, which declared that bank lending rates would thereafter be set solely on the banker-customer relationship and the supply and demand of loanable funds.[1] No reference rate has replaced it.

Declared rates and the one per cent band

Each bank declares sector-specific lending rates and may lend to an individual customer within a band one percentage point below or above the declared rate, depending on the customer's risk profile.[1] That band is the real negotiating range. A borrower with strong financials, good collateral and a clean CIB record should ask for the declared rate for its sector and argue for the lower end. Loans under Bangladesh Bank or government refinance and pre-finance schemes are priced under each scheme's own policy, not the market rate.[1]

Fixed or variable: the repricing clause

The same circular requires the sanction letter to state whether the rate is fixed or variable. If variable, it must specify the maximum number of times, and the maximum percentage by which, the rate may increase in a year.[1] Bank forms often contain a general right to change the rate "at the bank's discretion" on notice. In a term loan agreement Bangladesh lenders intend to rely on, that wording should be read down to the limits stated in the sanction letter, and a borrower should refuse any letter that omits them. Ask also for a matching right to prepay without fee within a short window after any increase.

Default interest and the 0.5 per cent penal cap

Penal interest was capped at 1.5 per cent in 2024.[1] On 13 May 2026, BRPD-1 Circular Letter No. 17 cut the maximum to 0.5 per cent with immediate effect. For a continuous or demand loan the penalty may run on the whole outstanding during the overdue period; for a term loan, only on the overdue instalment.[2] A default interest clause that charges a higher margin, or charges it on the entire term loan balance, should be corrected before signing, and overdue statements issued after 13 May 2026 should be checked against the cap.

Fees, prepayment and break costs

Expect a processing or front-end fee, documentation charges, a commitment fee on undrawn amounts and, sometimes, an early settlement fee. BRPD Circular No. 10 prohibits a bank from levying a service charge over and above its declared interest rate.[1] Every fee should be listed in the sanction letter with its basis and timing. Negotiate prepayment rights in particular: the right to prepay in whole or in part on short notice, without fee where prepayment comes from equity or insurance proceeds, with partial prepayments applied in inverse order of maturity so that instalments, rather than the tenor, fall.

Why the courts will not reopen the rate

Section 30 of the Bank Company Act 1991 provides that no court may try a dispute between a bank and its borrower on the ground only that the interest or profit charged was excessively high.[5] Arithmetic errors, unauthorised charges and breaches of circulars remain open to challenge, but the agreed level of the rate does not. Price has to be won before signature.

Representations, covenants and undertakings

Representations are statements of fact the borrower makes at signing and repeats on each drawdown and interest date. Covenants are promises about what the borrower will and will not do for the life of the loan. Both feed directly into the events of default, so a loose representation or an unrealistic covenant is a default waiting to happen.

Representations

Standard representations cover due incorporation, corporate power and authority, no conflict with the constitution or other agreements, accuracy of financial statements, absence of litigation, title to the secured assets and compliance with laws. Qualify them by materiality and by knowledge where you can, disclose known litigation in a schedule, and limit repetition to the representations that can sensibly be repeated. A representation that "no event of default is continuing" is acceptable; one that "nothing has occurred which may have a material adverse effect" is not.

Financial covenants

Lenders commonly test a debt-service coverage ratio, a debt-to-equity or leverage ratio, a current ratio and a minimum net worth. Insist on definitions that match your audited accounts and accounting policies, testing on annual or half-yearly figures rather than monthly management accounts, and an equity cure where shareholders can inject funds to remedy a breach. The move to expected credit loss provisioning means lenders will monitor these numbers more closely, so set headroom that survives a bad year.

General undertakings and the share-transfer trap

Negative pledges, restrictions on disposals, mergers and change of business, limits on further borrowing and dividend restrictions are standard. Keep them proportionate: carve out ordinary-course disposals, permitted security for trade finance and an agreed basket of other debt. One restriction comes from statute rather than the document. Section 27A of the Bank Company Act prevents a director of a borrowing company from resigning, or transferring or selling shares, without approval of the lending bank's board or senior management.[5] Sponsors planning an exit, investment or restructuring must build lender consent into the timetable.

Events of default and Bangladesh Bank loan classification

The events of default clause sets out when the lender may cancel, accelerate and enforce. In a term loan agreement Bangladesh banks draft, the list is usually long and often subjective. The aim is to make every trigger objective, give grace periods for technical breaches and avoid defaults that fire on events outside the borrower's control.

Typical events of default

• Non-payment: negotiate a short grace period for administrative or technical delays.
• Breach of covenant or representation: ask for a cure period of fifteen to thirty days where the breach is capable of remedy.
• Cross-default: limit it to financial indebtedness above a threshold, and to acceleration rather than mere default under other facilities.
• Insolvency and enforcement events: exclude frivolous petitions dismissed within a set period.
• Material adverse change: resist, or confine it to the borrower's ability to pay.
• Change of control and CIB status: define control precisely and specify which CIB reporting events count.

Why the classification clock matters

The contractual default under a term loan agreement Bangladesh banks draft and the regulatory classification are separate but connected. Bangladesh Bank's master circular on loan classification and provisioning, BRPD Circular No. 15 of 27 November 2024, has applied since 1 April 2025. A loan becomes a Special Mention Account when overdue for two months but less than three, and Sub-Standard at three months but less than six; Doubtful and Bad/Loss follow at six and twelve months.[3] For a term loan, an unpaid instalment is overdue from the day after it falls due, and the overdue period drives classification of the whole loan.[3]

Classification as non-performing means CIB reporting, suspended interest and, for the borrower, difficulty borrowing anywhere else. The circular also lets a bank downgrade an account on qualitative grounds even when payments are current.[3] A well-drafted facility agreement should therefore oblige the bank to notify the borrower of any classification change and give it the opportunity to regularise. The defaulter consequences are explained in our guide to loan defaulters in Bangladesh.

Acceleration, set-off and enforcement

On a continuing event of default the bank will accelerate, apply credit balances by set-off and enforce security. Banks and financial institutions recover through the Artha Rin Adalat, often after a pre-suit sale of mortgaged or hypothecated collateral. If you are on the receiving end, read our guide on how to defend a bank suit in Bangladesh; the deadlines run from service and are unforgiving.

Boilerplate that carries risk: law, disputes, tax and currency

Clauses at the back of a term loan agreement Bangladesh borrowers rarely read can matter as much as the price. Indemnities should exclude the lender's own negligence and wilful misconduct. Increased-cost and illegality clauses should give the borrower the right to prepay rather than simply pay more. Assignment clauses should require consent for any transfer to a non-bank or to a competitor. Governing law will be Bangladeshi for a local bank facility, and recovery will run through the Artha Rin system rather than arbitration.

Foreign currency term loans from offshore lenders and offshore banking units are a different exercise. They need regulatory approval, carry withholding tax gross-up clauses and usually choose English law with offshore dispute resolution. Approval and pricing are covered in our guides to foreign loan approval in Bangladesh and foreign loans. Any security or guarantee in favour of a non-resident lender also needs Bangladesh Bank permission under section 13 of the Foreign Exchange Regulation Act 1947.[7]

Syndicated loan structures and the syndicated facility agreement

A syndicated loan is a single facility provided by a group of lenders on common terms, documented in one facility agreement and administered by an agent. In Bangladesh it is the standard route for power, telecoms, steel, cement and other large industrial borrowers, and it gives the borrower access to larger sums while spreading risk across banks.[7]

Why banks syndicate: single-borrower limits

The driver is regulatory. BRPD Circular No. 01 of 16 January 2022 caps a bank's funded exposure to one person or group at 15 per cent of capital. BRPD-1 Circular Letter No. 18 of 14 May 2026 postponed that limit to 30 June 2028; until then, aggregate funded and non-funded exposure to a single borrower or group may not exceed 25 per cent of capital.[4]

The same letter lowered the conversion factor for non-funded exposure to 0.25 until 30 June 2027, phasing it back to 0.50 by 31 December 2029, and tied each bank's large-loan portfolio ceiling to its classified loan ratio, with aggregate large loans capped at 600 per cent of capital.[4]

The practical result is simple: any borrower whose requirement exceeds one bank's headroom needs a syndicated loan, and the arranger will size each participation around the lenders' remaining capacity.

Arranger, agent and security trustee

The mandated lead arranger wins the mandate, negotiates the term sheet and sells down participations. Once the deal closes, the facility agent administers it: it receives drawdown requests, collects funds from each lender, distributes repayments pro rata, circulates information and carries out lender instructions. The agent acts for the lenders, not the borrower. A security agent or trustee holds the collateral for the whole syndicate, which Bangladesh law accommodates through agency under the Contract Act 1872 and trusts under the Trusts Act 1882, so parallel debt structures are not required.[7]

The syndicated facility agreement

The commercial terms resemble a bilateral facility, but the syndicated loan agreement adds its own machinery. Lenders' obligations are several, so one lender's failure to fund does not oblige the others. Payments flow through the agent and are shared pro rata, and a sharing clause makes any lender that recovers more than its share, for example through set-off, hand the excess back for distribution. Decisions are taken by majority lenders, usually two-thirds by commitment, with unanimity for changes to pricing, maturity, amounts and security. Transfer clauses govern how participations move and whether borrower consent is needed.

Bangladesh Bank rules on syndication

We have found no standalone Bangladesh Bank circular currently governing syndicated loan transactions. Each participating bank applies its own credit approval, single-borrower limit, classification and CIB rules to its share, so a syndicated loan can be classified differently in different banks' books if their qualitative judgments diverge. The agency agreement should therefore require coordinated classification reporting and an agreed process for rescheduling, which each lender must approve individually.

Intercreditor issues and offshore participants

Where local and foreign lenders share security, or senior and mezzanine debt sit together, an intercreditor agreement fixes ranking, voting, enforcement instructions and the waterfall. Contractual subordination is enforceable between the parties but cannot override the statutory order in insolvency.[7] Foreign lenders that are not financial institutions under the Artha Rin Adalat Ain usually appoint a local scheduled bank as security agent so that pre-suit sale is available.[7] Our guide to secured transactions in Bangladesh covers security trustees and intercreditor terms in detail, and our guide to project finance in Bangladesh covers common terms agreements and direct agreements.

The hypothecation agreement: charging movables

A hypothecation agreement creates a charge over movable assets, plant, machinery, vehicles, stock and receivables, that remain in the borrower's possession, with a contractual right for the lender to take possession and sell on default. It is the workhorse security for working capital and equipment finance, and almost every term loan to a manufacturer includes one alongside the land mortgage.

What the deed must say

A hypothecation agreement in Bangladesh should identify the assets by schedule with serial numbers and locations, extend to replacements, additions and proceeds, require insurance with the bank named as loss payee, give inspection rights, prohibit further charges without consent, and grant an express power to take possession and sell. Stock and book-debt hypothecation needs periodic stock statements, a drawing-power formula and an agreed process for releasing sold goods. Borrowers should ask for the drawing-power formula to be fixed in the agreement rather than left to the bank's discretion.

RJSC registration within 21 days

For a company borrower, section 159 of the Companies Act 1994 makes certain charges void against the liquidator and creditors unless particulars are filed with the Registrar of Joint Stock Companies within 21 days of creation.[6] Hypothecation of plant and machinery is a charge on movables; a charge over trading stock is usually framed as a floating charge; book debts are a separate category. File every relevant category, and keep the RJSC filing receipt with the security file. Late or missing filing is the most common reason a hypothecation fails in insolvency.

The Secured Transactions (Movable Property) Act 2023

The Secured Transactions (Movable Property) Act 2023 adds a registration-based regime for security over listed classes of movable property, with sections on a registration authority, financing statements, perfection, priority and the secured party's rights on default.[8] It supplements rather than replaces hypothecation and RJSC registration, so lenders should do both where the collateral falls within its schedule. Our guide to secured transactions in Bangladesh explains eligible collateral, perfection and the state of the registry.

Factoring, hire purchase and leasing

Not every asset-based facility is a loan secured by a charge. Factoring is a purchase of receivables, so the key documents are the receivables purchase agreement, the notice to debtors and, for export factoring, compliance with Bangladesh Bank's export proceeds rules. Hire purchase and finance leases, including the Islamic hire purchase under shirkatul melk used by Shariah-based banks, keep title with the financier until the last payment. The 2023 Act treats a hire-purchase buyer and a lessee under a finance lease of more than one year as grantors of a security interest, so these financiers should consider registering under it.[8] Islamic structures are covered in our guide to Islamic finance in Bangladesh.

Acquisition financing in Bangladesh

Acquisition financing funds the purchase of shares or assets of a target business. Bangladeshi acquirers use cash, local bank term loans, shareholder loans, offshore debt and, increasingly, structured combinations of all four. The legal constraints come from the Bank Company Act, the Companies Act, securities regulation and foreign exchange control.

What constrains a bank lending for a share purchase

We found no statutory ban on a Bangladeshi bank lending to a company to buy shares in another company, but several provisions bite. Section 26A of the Bank Company Act regulates a bank company's holding of shares in other companies, section 26B sets general limits on credit exposure, and section 27 restricts loans and advances, including a bar on lending against the security of the bank's own shares.[5] Single-borrower limits apply to the acquirer's group as a whole.[4] Where listed shares are pledged, expect the bank to apply conservative loan-to-value ratios and margin-call mechanics.

Financial assistance under section 58

Section 58 of the Companies Act 1994 restricts a company from buying its own shares or lending for that purpose.[6] Section 58(2) prevents a company limited by shares from giving financial assistance, directly or indirectly, through loans, guarantees or security, for the purchase of its own shares, although the restriction does not affect loans made in the ordinary course of a lending business such as a bank.[7] In practice this means the target cannot simply guarantee or secure the acquisition loan after closing. Debt push-down needs a properly structured merger, refinancing or dividend route, and advice on each step.

Change of control, section 27A and listed targets

If the target already has bank debt, section 27A of the Bank Company Act means its directors cannot transfer their shares without the lending bank's approval.[5] Change-of-control clauses in the target's facilities will also be triggered. Build lender consents into the conditions precedent. For listed targets, the takeover rules apply: our guides to substantial acquisition of shares and mergers and acquisitions law in Bangladesh cover thresholds, offers and approvals.

Offshore acquisition debt and hedging

Offshore acquisition debt raises the same approval, all-in cost and withholding issues as any foreign loan, plus FERA section 13 permission for security over local shares or assets.[7] Hedging is still limited. In July 2026 Bangladesh Bank allowed authorised dealers to offer forward rate agreements to importers with floating-rate supplier's or buyer's credit, documented under a modified ISDA master agreement or an equivalent compliant with Bangladeshi law, for genuine hedging only.[9] Borrowers wanting broader swaps under an ISDA should expect regulatory questions and should not assume close-out netting will work as it does offshore.

Housing finance laws and home loans

Housing finance in Bangladesh is supplied by commercial banks, specialist housing finance companies, finance companies and the state-owned Bangladesh House Building Finance Corporation. Bank home loans are regulated mainly through Bangladesh Bank's Prudential Regulations for Consumer Financing, issued under section 45 of the Bank Company Act.

The January 2026 home loan ceilings

On 6 January 2026, BRPD-1 Circular Letter No. 01 replaced Regulation 23 on housing finance. The maximum per-party housing loan now depends on the bank's own classified loans in housing finance: BDT 40 million where they are 5 per cent or less of its housing portfolio, BDT 30 million above 5 and up to 10 per cent, and BDT 20 million above 10 per cent.[11] The maximum debt-equity ratio remains 70:30, and the bank must be satisfied that the borrower has adequate net cash inflow to service the loan.[11] The letter superseded the earlier instructions from 2004 onwards on this subject.

Bangladesh House Building Finance Corporation

BHBFC lends at 8 to 10 per cent with repayment of up to 30 years, against 13 to 14 per cent and up to 20 years at private lenders, according to figures reported in October 2025. Its rates are set by the finance ministry, and a draft amendment to its governing law would give its board power to set rates and retain earnings.[10] Fund shortages have limited disbursement, so applicants should expect waiting times and strict title requirements.

Flats, developers and the home loan file

For an under-construction flat, the lender will want the developer's registration and approvals under the Real Estate Development and Management Act 2010, the joint venture agreement with the landowner, a tripartite agreement and a mortgage once the deed is registered. Our guide to buying an apartment in Dhaka covers developer due diligence, allotment terms and registration, and our guide to the mortgage deed in Bangladesh covers the security.

Consumer finance law: cards, auto loans, personal loans and digital credit

Consumer finance is the most heavily prescribed area of Bangladeshi lending. The rules sit in Bangladesh Bank circulars rather than a consumer credit statute, and the 2026 changes have been significant.

Credit cards: the 25 per cent cap

BRPD-1 Circular No. 09 of 15 March 2026 updated the credit card guidelines. The effective annual interest rate may not exceed 25 per cent, charged on the unpaid amount due rather than the total amount due, and never from the transaction date; interest runs from the day after the payment due date.[13] The maximum unsecured limit for a non-corporate cardholder is Tk 20 lakh, with any excess secured by liquid securities and an absolute cap of Tk 40 lakh.[13] Changes to rates, fees or terms need at least 30 days' notice, late fees may be imposed only once where there is no new transaction, and recovery agents may not harass cardholders or call outside office hours.[13]

Auto and personal loans

Following BRPD-1 Circular Letter No. 21 of 25 June 2026, auto loans are capped at Tk 60 lakh per individual including insurance, or Tk 80 lakh for electric, hybrid and domestically manufactured vehicles, at maximum debt-equity ratios of 60:40 and 80:20 respectively; loans to dependants count towards the individual's exposure.[12] Personal loans, including consumer durable loans, may now run for up to eight years, and the earlier rule tying consumer loan growth to total loan growth was revoked.[12]

e-loans and digital nano credit

Digital nano loans began as bank and mobile financial service partnerships. BRPD-1 Circular No. 11 of 11 May 2026 now allows banks to launch "e-loans" commercially: up to BDT 50,000 at a time for up to 12 months, at market rates but no more than 9 per cent where refinancing is used, through an end-to-end digital process with biometric consent, after a pilot of at least six months.[14] Defaulted borrowers must be excluded, no CIB inquiry charge may be levied, and customer data must stay in Bangladesh.[14] Lenders partnering with fintechs should treat these conditions as the minimum content of their product documentation.

Compliance, complaints and enforcement

Consumer lenders are exposed on three fronts: Bangladesh Bank inspection and penalties for breach of circulars, customer complaints escalated to the central bank, and recovery litigation in which disclosure failures become defences. Clear key-fact statements, accurate interest calculations and documented consent are the best protection. Borrowers with a complaint should raise it first with the lender's complaint cell and keep written records. For broader consumer claims, see our consumer protection practice.

Step-by-step: negotiating a term loan agreement Bangladesh lenders will accept

The sequence below is how we take a corporate borrower from term sheet to first drawdown, whether the facility is bilateral or a syndicated loan.

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Keep a single negotiation log. Concessions agreed in meetings disappear when the bank's legal team issues the final draft, and the log is the easiest way to check that every agreed point has made it into the documents.

Comparing the main facility types

The table summarises how the main facilities discussed in this guide compare. On a phone, scroll it sideways.

Most corporate groups use several of these at once, often a syndicated loan for capital expenditure beside bilateral working capital lines, so the documents must work together: cross-default thresholds, negative pledge carve-outs and security sharing should be aligned across every facility agreement the group signs.

Mistakes to avoid in a term loan agreement Bangladesh borrowers sign

• Accepting a variable rate without limits. The sanction letter must state how often and by how much the rate can rise.[1]
• Ignoring the penal interest cap. Default interest above 0.5 per cent, or charged on the whole term loan balance, breaches the 2026 instruction.[2]
• Signing covenants you cannot meet. A covenant breach can trigger default and a qualitative downgrade even when every instalment is paid.[3]
• Missing the 21-day RJSC filing. An unregistered company charge is void against a liquidator and other creditors.[6]
• Using the target's assets to fund its own purchase. Section 58 financial assistance rules apply to companies limited by shares.[7]
• Forgetting sponsor share transfers need consent. Section 27A applies whatever the facility agreement says.[5]
• Treating a syndicated loan as one bank. Each lender applies its own classification and approves rescheduling separately.

What to watch for the rest of 2026

Several developments will shape every term loan agreement Bangladesh lenders issue over the next year. The single-borrower relaxation runs to June 2028 and the reduced non-funded conversion factor starts phasing out after June 2027, which will tighten headroom for large borrowers and push more facilities into syndicates.[4] Expected credit loss provisioning will bring closer covenant monitoring. Digital lending will expand as e-loans move from pilot to commercial launch.[14] Pending amendments to the Bank Company Act and the Artha Rin regime could change enforcement, so long-dated facilities should be drafted to adapt to new rules without renegotiation.

If you are negotiating a new facility, refinancing, joining a syndicate or financing an acquisition, our banking and finance practice reviews sanction letters and facility agreements, and our banking and finance litigation team acts where a loan has already gone wrong. Contact TRW to discuss your transaction.

Frequently asked questions

What is a term loan agreement in Bangladesh?

It is the contract under which a bank or financial institution advances a fixed amount for a set period, repayable in instalments. It sits alongside the sanction letter, which records the commercial terms, and the charge documents that secure the loan.

Is the SMART rate still used for bank loans?

No. Bangladesh Bank withdrew the SMART-based system on 8 May 2024. Banks now declare sector-specific rates and may lend within one percentage point either side, depending on the borrower's risk profile.[1]

What is the maximum penal interest on an overdue term loan?

Since 13 May 2026, a maximum of 0.5 per cent, charged only on the overdue instalment of a term loan.[2]

When does an overdue term loan become classified?

Under the master circular in force since 1 April 2025, a loan overdue for two months but less than three is a Special Mention Account, and from three months it is Sub-Standard and non-performing.[3]

Why are large loans in Bangladesh syndicated?

Because each bank's exposure to one borrower or group is capped by reference to its capital. Until 30 June 2028, aggregate funded and non-funded exposure may not exceed 25 per cent of capital.[4]

Does a hypothecation agreement need to be registered?

Where the borrower is a company, registrable charges, including charges on movables, book debts and floating charges, must be filed with the RJSC within 21 days, failing which they are void against a liquidator and creditors.[6]

Can a target company guarantee its buyer's acquisition loan?

Generally not directly. Section 58(2) of the Companies Act restricts a company limited by shares from giving financial assistance, including guarantees and security, for the purchase of its own shares.[7]

What is the maximum home loan from a bank in 2026?

Up to BDT 40 million per party where the bank's housing-finance classified loans are 5 per cent or less, BDT 30 million up to 10 per cent, and BDT 20 million above that, at a 70:30 debt-equity ratio.[11]

Is there a cap on credit card interest in Bangladesh?

Yes. The effective annual rate may not exceed 25 per cent, charged only on the unpaid amount due and only from the day after the payment due date.[13]

How much can I borrow through a bank e-loan?

Up to BDT 50,000 at a time for up to 12 months, through a fully digital process, under the May 2026 circular.[14]