Islami Bank customers welcome board dissolution, seek non-political new panel

A group of Islami Bank customers has welcomed Bangladesh Bank's decision to dissolve the bank's board of directors, but urged the central bank to immediately appoint a full board comprising honest, qualified and professional individuals with no political affiliation.

Under the banner of the Islami Bank Sachetan Grahok Forum, customers today (15 June) congratulated Bangladesh Bank for dissolving the board, including its chairman, and called for measures to restore confidence in the bank.

They also announced that they will submit a seven-point memorandum to the Bangladesh Bank governor tomorrow (16 June) at 11:30am.

At a press conference held at Islami Bank Tower in Dhaka's Dilkusha, the forum's convenor, Nurunnabi Chowdhury Manik, said a full board of directors should be formed immediately to ensure proper governance and protect customers' interests.

The forum also demanded the formation of a special tribunal to try those responsible for alleged bank looting, recovery of money laundered abroad, and an end to what it described as controversial decisions surrounding the bank.

Manik said customers had previously demanded the resignation of chairman Khurshid Alam, whom they alleged was associated with S Alam Group, the reinstatement of former managing director Omar Faruk Khan, and effective measures to restore trust in the bank.

"Islami Bank is not the asset of any individual or group. It is a national institution connected with the deposits, trust and future of millions of customers. Swift and effective steps must be taken to protect the bank's stability, good governance and the interests of customers," he said.

He argued that although Bangladesh Bank had dissolved the board, authority had again been concentrated in the hands of a single individual, which was not desirable for a financial institution.

Among its seven-point demands are the immediate formation of a full board of directors, the return of shares to their original owners, recovery of laundered funds, prevention of the rehabilitation of alleged bank looters, and measures to prevent panic surrounding Islamic banks.

Bangladesh Bank yesterday (14 June) removed Islami Bank's entire board of directors, including the chairman, under the Bank Company Act, 1991.

In a statement, the central bank said the board had been dissolved in the interest of depositors and the public.

It also said that, under Section 47(3) of the Bank Company Act, 1991, Bangladesh Bank Executive Director Mohammad Zahir Hussain had been assigned to exercise all powers and perform the responsibilities of the board.

On the same day, Bangladesh Bank extended a special loan of Tk2,500 crore to Islami Bank Bangladesh to help the Shariah-based lender address a worsening liquidity crisis.

The bank had been facing severe liquidity pressure following unrest that erupted after the Eid-ul-Adha holidays over the appointment of its now removed chairman, Md Khurshid Alam.

Islami Bank Sachetan Grahok Forum had been staging demonstrations in protest against the appointment.