Bangladesh Bank has decided to give non-bank financial institutions a breathing time to raise their paid-up capital to Tk 100 crore.

A total of nine NBFIs have failed to raise their capital by the December 31 deadline.

“We'll give those (NBFIs) some time. We've also asked Bangladesh Securities and Exchange Commission to expedite the right share offers of some of these NBFIs,” SK Sur Chowdhury, deputy governor of the BB, told The Daily Star.

But Chowdhury did not disclose how much time the NBFIs would get to raise their paid-up capital.

Some of the NBFIs had plans to raise their capital by offering rights shares but Bangladesh Securities and Exchange Commission earlier blocked the scope for the companies with negative earnings.

Bangladesh Leasing and Finance Companies' Association.

Khan, also the managing director of Prime Finance, said he would sit with the association members soon to discuss the issue.

The association also had a meeting with the central bank recently, he added.

The central bank last year asked the NBFIs to raise their paid-up capital to minimum Tk 100 crore by June 30 this year. Later, the deadline was extended to December 31.

Despite the time extension, nine NBFIs have failed to meet their capital requirements.

Of these companies, Phoenix and Bangladesh Industrial Finance Company (BIFC) have applications pending with the stockmarket regulator for nearly one year to raise their capital by issuing rights shares.

Another company, Industrial and Infrastructure Development Finance Company (IIDFC), said it has taken all the preparations to meet the deadline.

GSP Finance was not allowed to increase its capital through rights offer as the company is yet to pass one year since its listing on the stockmarket. Hajj Finance has been a losing concern until this year.

However, some of these companies told The Daily Star that they were in the process to meet the BB's capital requirement, but they would require more time to do so.

Inamur Rahman, managing director of BIFC, said they are in the process and informed the central bank about their roadmap to raise the capital.

“Everything is ready. We've audited out accounts and done credit rating. Now we'll go for permission from the stockmarket regulator,” said Rahman. “We need a few more months.” IIDFC is well ahead to meet the capital requirement.

“Presently, we've Tk 77 crore in paid-up capital. We'll inject Tk 22 crore from our retained earnings and the rest Tk 1 crore from the sponsors,” said Asaduzzaman Khan, managing director of IIDFC.

Khan said they have applied to the stockmarket regulator and will be able to meet the deadline.

A senior official of the stockmarket regulator, asking not to be named, said they would not allow any company having negative earnings to raise its capital through the offer of rights shares.

There are 31 NBFIs operating in the country. Of them, 22 are listed on the stockmarket.

The industry players said most of the 31 companies incurred losses in 2012 due to a rise in cost of funds and sluggish investment demands, coupled with competition from banks. As of 2011, the NBFIs have net investments of around Tk 20,000 crore with a net asset value of Tk 5,000 crore.