New Debt Restructuring Policy for Ailing Shipbuilders

In a decisive move to bolster the nation’s maritime engineering sector, Bangladesh Bank has unveiled a highly concessional debt rescheduling policy for export-oriented and local shipbuilding industries. Under the new directive, struggling entrepreneurs can now regularise their defaulted loans by providing a down payment of just 3%, with the added benefit of a decade-long repayment horizon.

Mitigating Global Macroeconomic Shocks

The central bank issued the notification on Tuesday, citing a confluence of external pressures that have severely hampered the cash flow of domestic shipyards. The policy acknowledges that the industry has been disproportionately affected by the global economic slowdown, heightened geopolitical tensions, and military instability in Europe, which have fractured international supply chains.

By offering these special dispensations, the regulator aims to ensure the continuity of industrial operations and prevent a systemic collapse of a sector deemed vital for the country’s blue economy aspirations.

Key Features of the Debt Rescheduling Policy

Procedural Requirements and Grace Periods

To qualify for this scheme, loans must have been classified as defaulted as of 31 December 2025. The restructuring process allows for the transfer of suspended and unapplied interest into a separate account. While the principal debt is restructured over ten years, the two-year grace period offers significant breathing room; however, borrowers are required to pay the interest accrued on the principal during this window on a monthly or quarterly basis.

Following the conclusion of the grace period, the interest stored in the “blocked account” will be repayable in separate instalments without further interest charges. Crucially, the central bank has waived the “compromise amount” usually required to access new credit facilities after rescheduling.

Guardrails Against Wilful Defaulters

The central bank has incorporated strict eligibility criteria to prevent the misuse of public funds. The circular explicitly states that loans originated through fraudulent activities or those belonging to wilful defaulters are strictly excluded from this package.

Commercial banks are mandated to conduct “special inspections” to verify that a client’s financial distress is genuinely the result of factors beyond their control, such as market volatility or supply chain disruptions. Should a borrower fail to meet the revised instalment deadlines, the loan will be reclassified as defaulted, and no further opportunities for rescheduling will be granted.

Banks have been instructed to settle all applications within 60 days of receipt, ensuring a swift injection of financial stability into the shipbuilding industry.