MD MEHEDI HASAN

Bangladesh Bank (BB) has extended a total of Tk 12,500 crore in emergency funds to three beleaguered banks to dress up their balance sheet ahead of the year’s end.

On December 30, National Bank, Islami Bank Bangladesh and AB Bank took the fund on an overnight basis at the standing lending facility rate of 11.50 percent, The Daily Star has learnt from central bank officials.

National Bank took Tk 6,000 crore, Islami Bank Bangladesh received Tk 5,500 crore and AB Bank received Tk 1,000 crore against “demand promissory note” as the banks have no securities to offer as collateral.

Apart from the overnight Tk 1,000 crore, AB Bank also received Tk 200 crore as long-term liquidity support.

A demand promissory note is a legally binding document between a borrower and a lender. With this agreement, the borrower promises to repay the money whenever the lender demands it.