Nu 305mn sanctioned for PSL

Nu 305mn sanctioned for PSL

Around Nu 305.8mn was sanctioned for Priority Sector Lending (PSL) in 2018.

Last year, dzongkhags collectively received 1,274 PSL applications of which 1,009 projects were approved. Thimphu, received the highest number of applications with 247 projects according to the fourth quarterly report of Royal Monetary Authority.

The PSL initiative was launched on December 13, 2017 for implementation with effect from January 1, 2018.

Seventy eight percent of the projects were agriculture-related projects with the highest concentration in primary production. Projects were clustered around similar ideas while proponents were all individuals with only a handful of groups.

The financial institutions collectively assessed 779 projects in 2018 of which 316 projects were approved. More than half the projects rejected by the financial institutions were on account of poor credit history of the clients.

According to report, of the total amount sanctioned in 2018, Nu 229.8mn was disbursed by year end.

While there was no Non Performing Loans (NPL) reported as of December 2018, current updates reveal that seven accounts are classified under NPL category overdue for more than 91 days and eight accounts were overdue by more than 45 days.

Thimphudzongkhag continued to receive the highest numbers of PSL applications with 247 projects and approved 193 projects followed by Tsirang with 131 PSL applications and approved 103 projects.

Lhuntse and Trashiyangtse received the lowest applications. Both the dzongkhags received and approved four projects last year.

Similarly, financial institutions collectively received 779 applications of which loan approvals were given for 316 projects. Two hundred and twelve were for agriculture products and 95 for non-agriculture products.

The Bank of Bhutan approved 145 projects and sanctioned Nu 93.27mn, Bhutan National Bank sanctioned Nu 152.54mn for 121 projects, Bhutan Development Bank Limited sanctioned Nu 10.44mn for 21 projects, Druk PNB sanctioned Nu 6.77mn for 13 projects, T bank sanctioned worth of Nu 18.70mn for eight projects, Royal Insurance Corporation of Bhutan Limited sanctioned worth of Nu 23.71mn for seven projects and Bhutan Insurance Limited sanctioned worth of Nu 0.33mn for one project in Thimphu.

The report also states that 284 policy products have been insured for the sum of Nu 121.86mn.

Dechen Dolkar from Thimphu