Global Islami, Union banks freed from S Alam’s grips
The Bangladesh Bank yesterday reconstituted the boards of two banks and decided to restructure two others, all controlled by S Alam Group, by next week in a bid to free them up from the grip of the Chattogram-based business cartel.
The central bank also assured businesses that it will lift the restrictions on opening letters of credit (LCs) imposed on these banks.
In a separate development, the newly reconstituted board of Islami Bank Bangladesh has decided to reaudit all loans disbursed since S Alam Group took control of the bank.
The central bank appointed new fivemember boards of directors for both Global Islami Bank and Union Bank. Former Meghna Bank managing director Nurul Amin will lead the board for Global Islami Bank, while former Islami Bank managing director Fariduddin Ahmed will chair the board for Union Bank.
According to the Bangladesh Bank, the boards of First Security Islami Bank and Bangladesh Commerce Bank will be restructured in the next one week.
In a separate development, the central bank restructured the board of United Commercial Bank (UCB). The board members include former Bangladesh Bank executive director Sajjad Hossain, former Agrani Bank deputy managing director Md Yusuf Ali, and chartered accountant Obaidur Rahman FCA. Additionally, Sharif Zahir and Md Tanvir Khan have been appointed shareholder directors, on the condition that they resign from their positions on the boards of National Finance and Eastland Insurance Company, respectively.
Earlier last week, the Bangladesh Bank reconstituted Islami Bank, freeing it from the control of S Alam Group.
The other board members of Global Islami Bank are: Bangladesh Bank's former executive director Jamal Mollah; former Islami Bank deputy managing director Nurul Islam Khalifa; Dhaka University's International Business Department Professor Abu Hena Reza Hassan; and Chartered accountant Mahmud Hossain.
The other board members of Union Bank are Bangladesh Bank's former executive director Humayun Kabir; former RAKUB deputy managing director Saiful Islam; Dhaka University's Department of Banking and Insurance Professor Shahidul Islam Jahid; and Chartered accountant Sheikh Jahidul Islam. All of the members of the two banks have been appointed as independent directors, according to separate circulars issued by the central bank yesterday.
During an emergency meeting with a delegation from the Bangladesh Garment Manufacturers and Exporters
Association (BGMEA), Bangladesh Bank Governor Ahsan H Mansur announced the decision to restructure the boards of banks controlled by S Alam Group. After the meeting, BGMEA Senior Vice-President Abdullah Hill Rakib told reporters, "The Bangladesh Bank has agreed to launch a Tk3,000 crore soft loan package and continue EDF activities. The governor has assured a swift resolution to the LC issue for the six banks."
Several attendees shared details of the meeting with The Business Standard, saying the governor agreed to continue the Export Development Fund (EDF) and will continue to provide regular loans from the existing $3 billion. A week ago, the central bank halted LC operations at six banks controlled by S Alam Group due to widespread corruption and irregularities, suspending the import and export activities of businesses associated with these banks.