DHAKA, Jan 06, 2026 (BSS) - In a move to align with the current market reality, Bangladesh Bank (BB) has revised the maximum limits for housing finance, effective immediately. 

To this end, the central bank today issued a circular, amending Regulation 23 of the Prudential Regulations for Consumer Financing to better reflect the surging prices of construction materials and the growing demand for real estate.

According to the new directive, the maximum loan amount a bank can sanction to a single party is now tied directly to the bank's performance in managing its existing housing loan portfolio. 

According to the circular, Taka 40 million for banks where classified housing loans are less than or equal to 5% while Taka 30 million for banks with classified housing loans between 5% and 10% and Taka 20 million for banks where classified housing loans exceed 10%.

The central bank has maintained a maximum debt-equity ratio of 70:30 for housing finance facilities. 

Furthermore, banks are strictly instructed to ensure that borrowers possess a sufficient net cash inflow to service their loans as per the agreed repayment schedules.

This policy shift, issued under the authority of Section 45 of the Bank Company Act, 1991, supersedes previous instructions laid out in 2004 and 2019. While the loan ceilings have been adjusted, other existing instructions regarding consumer financing remain unchanged.

The decision is expected to provide much-needed breathing room for prospective homeowners facing higher building costs while simultaneously incentivizing banks to maintain a low percentage of defaulted loans.