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Bank & Finance - September 14, 2023

CBC confiscating shares of 3 Eastern Ins directors

Staff Correspondent: The Commercial Bank of Ceylon (CBC) is confiscating 7 lakh 53 thousand 900 shares of three directors of Eastern Insurance Company Limited listed in the stock market. Dhaka Stock Exchange (DSE), the major stock exchange, has allowed the bank to seize these shares to recover a loan of Tk 5 crore.
Umm Kulsoom Mannan, entrepreneur-director of Eastern Insurance, director Sanman Sweaters and Alpha Textile took loans against the said shares from CBC.
The shares will be transferred to the bank within 30 working days outside the DSE trading system, DSE said on Tuesday.
Among the said shares, 382,000 of Umm Kulsoom Mannan, 201,100 of Sanman Sweater and 170,800 of Alpha Textile.
Umm Kulsoom holds 2.01 percent of the total stake in Eastern Insurance, Sunman Sweaters 2.01 percent and Alpha Textile currently holds 2.53 percent. And the company has a combined share of 47.61 percent.
As per rules, a listed company must hold at least 2 percent of the company’s shares to hold a director’s seat.
Earlier, Commercial Bank of Ceylon applied to the stock exchange to forfeit their shares after the three directors of Eastern Insurance discussed defaulting on their loans. As per the listing rules, DSE will transfer the forfeited shares as defaulters.
Eastern Insurance Company started operations in 1986 and listed on DSE in 1994 and Chittagong Stock Exchange in 1996. Its paid up capital is Tk 43.11 crore.
In 2022, the insurance company paid 22 percent cash dividend to shareholders.

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