The Bangladesh government, in a pivotal move to stabilize the power sector, has raised Tk 20.62 billion through special bonds in collaboration with City Bank and Pubali Bank. The initiative aims to settle outstanding liabilities owed to private power plants while grappling with financial challenges due to delays in subsidy disbursement.
The government issued bonds with an 8.0% coupon rate, tied to the Bangladesh Bank’s repo rate, allowing flexibility for adjustments based on future rate fluctuations. The bonds have a maximum tenure of 10 years, addressing the urgent needs of the power sector. Major players like Summit Power and United Power benefit from this, with phased agreements planned with other banks. This strategic financial maneuver underscores the government’s commitment to ensuring stability in Bangladesh’s power sector.