Bangladesh Bank (BB) has granted permission to release the remaining portion of an approved foreign currency syndicated loan for power generation company SS Power-I Limited.

The thermal power plant is a concern of S. Alam Group of Industries, located in Banshkhali, Chattogram.

Under the decision, the central bank permitted the release of nearly US$ 3.2 million, which constitutes the remaining portion of the syndicated loan under Rupali Bank PLC. It also waived the application of a specific provision of the Bank Company Act, 1991 regarding the opening of Letters of Credit (LC) for the company.

The Banking Regulation and Policy Department-2 of the central bank issued a notification on Wednesday (August 19) in this regard. A circular letter was subsequently sent to the managing directors and chief executive officers of all scheduled banks to take necessary action.

According to the central bank notification, Section 27ka ka (3) of the Bank Company Act, 1991 will not apply to SS Power-I Limited for releasing Rupali Bank PLC's remaining $3,197,561.28 ( around $32 million) foreign currency syndicated loan and for opening LCs.

However, the central bank attached a crucial condition to this permission. Bangladesh Bank stated that no financial liability will be created for the central bank against this loan facility. Rupali Bank cannot claim any financial assistance or support from Bangladesh Bank against this loan in the future.

Central bank officials noted that this special permission clears the way for Rupali Bank to disburse the remaining balance of the previously approved syndicated loan to SS Power-I Limited and creates the opportunity to open the necessary LCs for import activities.

The notification specified that the decision was taken under the powers vested in Bangladesh Bank by Section 121 of the Bank Company Act, 1991.