Dhaka, Jan. 26 -- The central bank plans to reduce the volume of large corporate loans from the banking sector as part of efforts to rein in defaulted loans and develop the bond market, says Bangladesh Bank Governor Ahsan H Mansur.

Speaking at a seminar titled "Bond Market Development in Bangladesh: Challenges and Recommendations" at a hotel in Dhaka's Gulshan on Monday, the governor said: "The corporate sector will be separated from banks. Large borrowers will not be allowed to exceed the single borrower limit."

Currently, there is a ceiling on how much a company or group can borrow from a commercial bank, called a single borrower limit.

At present, the single borrower limit is set at a maximum of 25 per cent of a bank's capital, mean...