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Bangladesh Bank Requires Withdrawal of Legal Cases for Incentive Eligibility

Bangladesh Bank has introduced a new rule requiring the withdrawal of all pending legal cases against the government or banks for customers to be eligible for incentive packages.

By Staff Correspondent
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BB makes withdrawal of legal cases mandatory for access to incentive packages | Business
BSS

Bangladesh Bank (BB) has mandated that bank customers must withdraw all pending writ petitions and other legal cases against the government, the central bank, or their respective banks to become eligible for government and central bank incentive packages and policy support. This directive was issued through BRPD Circular Letter No. 25 under Section 45 of the Bank Company Act, 1991, with immediate effect.

New Compliance Requirement

Customers seeking incentives or policy support must now submit documentary proof of the withdrawals along with an affidavit declaring that no undisclosed legal disputes remain pending. The affidavit must include a complete list of all withdrawn cases and a declaration confirming that no other writ petitions or legal proceedings against the Government, the central bank, or the lending bank are currently active.

Aim and Impact

The central bank said the measure is aimed at reducing the growing backlog of banking-related litigation, which has become a major obstacle to improving financial sector governance and ensuring the effective implementation of state-backed support programmes. BB noted that some customers have continued to enjoy government-funded incentives and policy benefits while simultaneously pursuing legal action against the authorities, creating inconsistencies in the implementation of financial support measures.

The circular said reducing legal disputes would help strengthen the banking sector, promote private investment, increase the flow of credit to productive sectors, generate employment, and support sustainable economic growth. The directive applies to all government and Bangladesh Bank incentive packages and policy support schemes that have already been announced or may be introduced in the future.

Sectors Affected

The sectors covered include export-oriented industries, including support for reopening closed factories, agriculture, and cottage, micro, small and medium enterprises (CMSMEs). The circular has been sent to the managing directors and chief executive officers of all scheduled banks with instructions for immediate compliance.

Source: BSS

FAQ

What must customers do to be eligible for incentives?
Customers must withdraw all pending writ petitions and other legal cases against the government, the central bank, or their respective banks.
What documentation is required for compliance?
Customers must submit documentary proof of withdrawals and an affidavit declaring no undisclosed legal disputes remain pending.

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