ISLAMABAD, March 1: Zarai Taraqiati Bank Limited (ZTBL) has announced a scheme for settlement of non-performing loans classified as ‘loss’ continuously for more than three years.

According to a press release issued here on Saturday, the scheme has been announced in line with the guidelines of State Bank of Pakistan for write off/remission of irrecoverable loans.

The scheme applies to only stuck-up and non-recoverable loans. For classification purposes, loans have been categorized into three groups depending on outstanding amount.

Under the package, only those cases are eligible for settlement, which are continuous in default from July, 1998, in case of production loans and July, 1997, in case of development loans.

The defaulters can get their loans amounting upto Rs0.5 million settled by paying 50 per cent of the present outstanding amount with 10 per cent of outstanding amount as down payment, while the balance should be paid within three months.

In cases where the outstanding amount is more than Rs0.5 million but less than Rs2.5 million, the outstanding amount should be deposited in cash to settle the accounts.

This criteria will also apply to cases where the outstanding amount exceeds Rs2.5 million or where latest value of properties/stocks held as security is over Rs2.5 million.

All litigation cases initiated by the bank and pending in courts can be settled through compromise decree. The cases will be withdrawn if agreed amount of settlement is received and loan account is closed.

The settlement under this package will be made only on the basis of cash recovery. The borrower’s loan account will be closed after repayment of entire settlement amount.

The ZTBL settlement scheme will be available to the borrower/applicants till April 14.