Standard Group secures $50m loan after arson

Standard Group has secured $50 million or Tk 400 crore low-cost loans from Bangladesh Bank and commercial banks to resume production at its burnt-out factory complex.
Of the loan amount, $25 million will come at LIBOR (London Inter Bank Offer Rate) plus 1.5 percent interest rate from the central bank’s export development fund.
Bangladesh Bank will charge LIBOR plus 0.5 percent, instead of existing 1 percent, to commercial banks, which will charge LIBOR plus 1 percent, in stead of 1.5 percent, to give the loan to Standard Group.
Three foreign commercial banks will provide the rest $25 million by converting local currency into foreign currency at low interest. Standard Group has loan accounts with Standard Chartered Bank, HSBC and Citibank in local currency.
Enraged by a rumour that police killed two factory staff, garment workers torched a 10-storey factory building of Standard Group in Gazipur last month. Four other buildings in the complex were reportedly damaged, along with 22 trucks loaded with garments. The company estimated the losses at Tk 1,200 crore.
SK Sur Chowdhury, BB deputy governor, disclosed the initiatives of the central bank at a press briefing yesterday after a meeting with Standard Group, five banks and leaders of Bangladesh Garment Manufacturers and Exporters Association at the BB premises.
Governor Atiur Rahman presided over the meeting.
Standard Group will also get a five-year loan rescheduling facility without down payment with a one-year grace period.
According to central bank statistics, Standard Group’s outstanding loans were $31.84 million as of December 4.
Of the amount, the outstanding loans of its nine subsidiaries that were devastated by the fire were $27.39 million, while 10 other subsidiaries owed the rest $4.45 million.
“All the facilities will be applicable only for Standard Group for a limited time,” the BB deputy governor said.