Dhaka, Bangladesh (BBN)- Bangladesh Bank (BB) will dissolve the board of Islami Bank within a couple of days and all S Alam Group’s shares of the bank will now be under the government's control, BB Governor Ahsan H Mansur disclosed on Wednesday.
The central bank will form a new board of the Shariah-based bank, the governor said at a press conference at the central bank headquarters in the capital Dhaka.
"Islami Bank's board will be dissolved and independent directors will be appointed for a short period of time. Subsequently, former directors holding 2.0 per cent of share capital will be taken on the board," the governor told reporter at the briefing.
Currently, among the directors, former shareholders do not hold 2.0 per cent or more shares, due to which the independent director will be brought in, he added.
"The shares will be released to S Alam if they can repay the bank loan. S Alam's liabilities will be adjusted if the loan is not repaid by selling the shares," he explained.
The disclosure comes amid unrest in the largest Shariah-based bank in Bangladesh following the political changeover early this month.
Protestors demanded a restructuring of the board and removal of the top management of Islami Bank, which was taken over in 2017 by S Alam Group Chairman Mohammed Saiful Alam, his family members and the group's associated entities under the patronage of the previous Awami League government.
Asked if boards of all banks under S Alam Group's control would be dissolved, the governor said, "We are not in such a rush. A decision will be taken about the boards of these banks gradually.” "Yesterday, we dissolved the National Bank board.”
Earlier on 20 August, the central bank dissolved the board of directors of the National Bank on the grounds of numerous irregularities for the third time.
The central bank has also formed the new board of directors compressing three sponsor directors including Abdul Awal Mintoo along with four independent directors to run the bank properly.
“The directors will be elected their chairman,” a senior BB official told BBN while replying to a query.
Earlier on May 05 this year, the BB issued an order to dissolve the then board of National Bank and formed a new board with its sponsor director Khalilur Rahman as the chairman in order to ensure good governance in the ‘troubled’ bank
Besides, the BB issued an order on December 21 in 2023 to dissolve the then board of National Bank and formed a new board.
BBN/SRR/AD