BB cuts interest on exporters' borrowing from EDF
Economic Reporter :
Bangladesh Bank (BB) has reduced the interest rate on loans from its Export Development Fund (EDF) by 1 percent to boost exports.
"It has been decided that interest rates on EDF loans to Authorized Dealers (ADs) will be charged by Bangladesh Bank at six-month USD LIBOR (London interbank offered) plus 0.50 percent, while ADs will charge interest to manufacturer-exporters at six-month USD LIBOR plus 1.50 percent for disbursements until June 30, 2020," according to a BB circular issued on Tuesday.
Earlier, ADs were charged by Bangladesh Bank at six-month USD LIBOR plus 1 percent, with the ADs charging at six-month USD LIBOR plus 2.50 percent on their USD loan disbursements to manufacturer-exporters.
The Libor or the London interbank offered rate is what the banks charge each other for short-term loans in the London Interbank Market. It serves as a global benchmark for the banks for short-term interest rates. The latest interest rate on EDF will remain effective until June 30, according to the circular.