LAHORE, May 29: The central bank has directed the National Bank to speed up the settlement of loan write-off cases under its guidelines/scheme for “write-off of irrecoverable loans and advances” given in October.

In a letter sent to the NBP president Ali Raza, the central bank has taken serious notice of the slow progress on the cases filed with NBP for settlement under the said scheme.

The SBP letter reads: “It has been noted from the status report submitted for the end-March, 2003 that NBP has settled only six cases. Besides, no case has been reported/settled under categories A and B of the scheme.

“This status reported by the NBP can in no way be termed as satisfactory taking into account the time elapsed since the introduction of the scheme and against the encouraging position of settlement apprised by the NBP during different meetings held at the central bank in this regard.”

The SBP letter asks the NBP president to look into the matter personally so as to ensure that the bank is on track towards the settlement of cases under the guidelines and also to furnish accurate data to the central bank in this regard.

The central bank had issued the guidelines on the scheme for writing off irrecoverable loans and advances in its Circular BPD- 29 issued on October 15 last year.

The last date of April 14, 2003 for availing the scheme has already been extended to June 30.

The central bank scheme originally addressed those projects whose loans and advances have been classified as loss for three years. The scheme was amended later on to include the borrowers of the restructured and rescheduled loans and advances to allow them to get their debts settled if they have defaulted on their fresh payment schedule.