Instability rises in 10 BD banks

Extreme conflict started over ownership

Zarif Mahmud: There has been extreme instability in banks. There is always tension in banking arena due to ownership conflict. During the outgoing Sheikh Hasina government, the owners of S Alam Group, Beximco Group and other government-related businessmen seized the banks, now there is a tone of change of ownership.
The workers of the banks are now protesting in front of 10 banks demanding change of ownership. When people of S Alam Group entered Islami Bank’s head office yesterday, there was an incident of random firing and six employees were injured. Apart from this, bankers are conducting various programs including human chain in front of other banks. In this situation, due to the various crises of the banking sector that have gone before, the crisis of ongoing instability has been added, and now the whole banking sector is in a fragile state.
Meanwhile, the crisis that has arisen in Bangladesh Bank around the resignation of the central bank governor Abdur Rauf Talukder and the exit of the deputy governors is having a negative impact on the entire banking sector of the country. In this situation, Professor Dr. Muhammad Yunus led interim government to take effective steps to resolve the ongoing crisis in the banking sector.

Eminent economist and executive director of Policy Research Institute Dr. Ahsan H. Mansoor said, “There is a special situation in the country due to the change of government.” In this situation, it may not be possible to eliminate all the crises immediately, but the new government should give more importance to the whole financial sector, including the banks, so that the normal situation returns quickly. We all know that the banking sector of the country has been destroyed during the outgoing government. Banking practices, bank activities – in short, the entire banking sector has suffered a lot. Just as the new government has to put an end to this situation, the conflict that has arisen over ownership must also be resolved quickly. At the same time, the deadlock of the central bank must be ended quickly.
Basically, after the fall of the government, there was a big chaos in the country’s banking sector. Apart from at least 8 private banks, state-owned banks are also in trouble. In the absence of top officials including the governor, order did not return to Bangladesh Bank itself. Those concerned think that the bank sector has become so unstable due to the lack of guardians.
There has been chaos in several private banks including Islami Bank Bangladesh PLC, Social Islami Bank, United Commercial Bank (UCB), IFIC Bank. Among them, Islami Bank’s Managing Director (MD) Muhammad Munirul Mawla has been prevented from office work. Two deputy managing directors (DMDs) of Social Islami Bank have been forced to resign. Protests and human chain took place in front of United Commercial Bank. There have been demands to change the board of directors of some other private banks including National Bank, Southeast Bank, Al-Arafah Islami Bank or to include new directors.
Economists and bank executives say that the condition of the country’s banking sector is already fragile due to unlimited irregularities and corruption. Due to loss of money in the name of loans, the foundations of most banks have been completely weakened. Now is the time to pull the banking sector. But if the chaos that is emerging is not controlled quickly, the situation will turn dire. Many banks in the country will go bankrupt if panicked customers start withdrawing their deposits. Besides bringing law and order under control, the main responsibility of the new government will be to restore order in the banking sector.
The officials who participated in the protest claimed that after the change of ownership in 2016, many honest and efficient officials of Islami Bank were fired. On the contrary, the associates of the bank’s money loss got promoted quickly. Now those corrupt officials will not be allowed to work in the bank. Again, the officers and employees who have been appointed since 2016 will not be allowed to enter the bank.
IFIC employees protest demanding resignation of Salman F Rahman: The sacked officials of the bank demanded the resignation of private IFIC Bank Chairman Salman F Rahman and all the directors representing Beximco Group including his son. At the same time, during the time of former Managing Director (MD) Shah A Sarwar, those who were dismissed ‘unfairly’, the demand for reinstatement has been raised. On Sunday, more than two hundred people held a protest program at the bank’s head office located at Dainik Bangla intersection in the capital under the banner of ‘IFIC Bank’s sacked officials’.
Salman F Rahman was former Prime Minister Sheikh Hasina’s advisor on private industry and investment. At the same time, he is the Vice Chairman of Beximco Group. After the fall of the Sheikh Hasina government, he was not seen anywhere in public. His son Ahmed Sayan Fazlur Rahman is the Vice Chairman of IFIC Bank.
The protesters alleged that IFIC Bank Chairman Salman F Rahman looted thousands of crores of rupees. Working as his associate is former MD Shah A Sarwar, who is currently an advisor to the bank. Shah A Sarwar is forcing many officers and employees to resign from their jobs by ‘creating psychological pressure’.
Nine points of demand have been raised by those who participated in the protest. These demands include the immediate reinstatement of the officials who have been forced to resign. However, those who have already crossed the service age will have to pay dues along with promotion and pay increment.
Human chain to free Social Islami Bank S Alam: Some shareholders of the bank have formed a human chain to free the private Social Islami Bank (SIBL) from the hands of S Alam Group. In a press conference after the human chain in front of the National Press Club, they alleged that Saiful Alam, the owner of the S Alam Group and his associates have cheated the depositors of thousands of crores of taka. As a result, not only SIBL, but the entire financial sector is under threat. Ordinary depositors could not withdraw their deposits as required.
Former chairman of the bank Rezaul Haque, former director Anisul Haque, Asaduzzaman, Sultan Mahmud Chowdhury, Abdur Rahman, Abul Basar Bhuiyan and other ordinary and entrepreneurial shareholders were present in the human bonding and press conference.
It is known that Chittagong-based S Alam Group came under the ownership of Social Islami Bank in 2017. The bank’s current chairman, Belal Ahmed, is the son-in-law of Saiful Alam, chairman of S Alam Group. Some entrepreneurs and directors of the bank were left out during the change of ownership. It is alleged that huge amount of money was withdrawn anonymously from the bank and residents of Chittagong’s Patiya were given priority in employment. As a result, the bank is already in financial crisis and the current account maintained with the central bank is also in deficit. In a written statement at yesterday’s human bond press conference, S Alam Group demanded that the ownership of the bank be transferred to the real owners and founding entrepreneurs by ‘freeing it from possession’.
Shooting at Islami Bank: There was a shooting incident outside the head office of Islami Bank Bangladesh located in Dilkusha of the capital. During this incident on Sunday morning, there was a clash between the officers-employees who were appointed to the bank before 2017 and the officers-employees who were appointed after that. Six people were injured in the shooting. One person was taken to hospital in critical condition.
Meanwhile, finance adviser Dr. Salehuddin Ahmed,the financial adviser also said that the Islami Bank incident will be discussed with the law enforcement agencies. Those who are guilty will not be spared. The Finance Adviser said these things while talking to reporters at noon yesterday after an exchange meeting at the Finance Department of the Finance Ministry.
Demand for ‘Zero Tolerance’ policy to prevent corruption in banking sector: Meanwhile, Bangladesh Bank Officers Welfare Council has demanded to adopt ‘Zero Tolerance’ policy to prevent political influence, money laundering, defaulters and corruption in order to reform the banking sector. Bangladesh Bank Officers Welfare Council Acting President Tanvir Ahmed and General Secretary AKM Masum Billah signed this demand on Sunday.
They said that the advisor of the Ministry of Finance and Planning of the Interim Government Salehuddin Ahmed has already vowed to reform the entire banking and financial sector, including the central bank. On behalf of the officials of Bangladesh Bank, the Council expresses its solidarity with this conviction and strongly demands the reform of the entire banking sector, including the Central Bank. We believe that full autonomy of Bangladesh Bank is necessary to bring order to the banking and financial sector.
Forming a search committee to find a new deputy governor – Ministry of Finance: Meanwhile, the Ministry of Finance has started taking initiatives to eliminate the ongoing crisis of the central bank. In a notification yesterday, instructions have been given to Deputy Governor Nurun Nahar to perform the duties of the Governor. At the same time, other deputy governors have also been asked to continue their duties.
In another notification, it is said that a 3-member search committee has been formed to find a new deputy governor of Bangladesh Bank. A source in the Ministry of Finance reported this information on Sunday. The members of the search committee are Dr. Ahsan H Mansoor, Muslim Chowdhury and Nazrul Islam.