The decision to remove the top three of the senior management and the announcement on their replacements was made at a closed door meeting of the bank’s board of directors
After the top level management of Islami Bank Bangladesh Ltd (IBBL) was removed, forcibly according to critics, on January 5 this year, Social Islami Bank Ltd (SIBL) on Monday faced a similar series of drastic changes to its upper echelon.
SIBL Chairman Major (Retd) Dr Md Rezaul Haque and Executive Committee Chairman Md Anisul Hoque were replaced by former Chittagong University vice-chancellor Prof Anwarul Azim Arif and Belal Ahmed, vice chairman of NRB Global Bank, respectively, inside sources told the Dhaka Tribune.
The Managing Director of SIBL, Shahid Hossain, has also stepped down and been replaced by Quazi Osman Ali, additional managing director of First Security Islami Bank Ltd, sources confirmed.
The decision to remove the top three of the senior management and the announcement on their replacements was made at a closed door meeting of the bank’s board of directors at The Westin hotel in Dhaka under tight security.
The names of the replacements will be sent to the Bangladesh Security Exchange Commission (BSEC) and Bangladesh Bank (BB) for approval.
The changes in high level management at both SIBL as well as at IBBL on January 5 are allegedly being backed by Chittagong-based S Alam Group that bought up shares of both banks prior to the takeover.
Also Read- What’s going on at IBBL?
Both Arif and Belal took their positions as directors on the board for the first time at Monday’s meeting. Arif qualified for the position of director as he is a representative of the little-known Hasan Abashan Company Ltd, a sister concern of S Alam Group.
First Security Islami Bank Ltd, where Quazi Osman Ali was additional managing director, is also owned by S Alam group.
According to sources, Belal is the son-in-law of S Alam Group Chairman and Managing Director Mohammed Saiful Alam.
When contacted, newly-elected SIBL Chairman Prof Anwarul Azim Arif told the Dhaka Tribune: “The Board of SIBL has made me a director as well as chairman of the bank at the meeting today (Monday), and the executive committee chairman and managing director have also been changed. The previous holders of the positions have resigned.”
Inside sources further said that the departing chairman, executive committee chairman and managing director were not present at the board meeting where the decision was taken, though S Alam Group chairman Saiful was in attendance.
A director present at the board meeting told the Dhaka Tribune on condition of anonymity that the departing chairman, executive committee chairman and managing director were prevented from coming to the meeting. “The change was made forcibly,” the director said.
How the takeover happened
At the beginning of this year, United Group began buying shares of SIBL. In the space of a few months, they had acquired a 31% share in the bank. However, in the face of allegations from BSEC that they breached rules regulating the buying of shares, they sold their stake in the bond market.
According to sources, the S Alam Group bought these shares from the bond market over the last two months by using relatively unknown companies that they allegedly own. The group also bought SIBL shares from other companies, finally establishing a 40% stake in the bank.
Also Read- Reforms take toll on IBBL’s performance
The companies allegedly used by S Alam Group to buy shares of SIBL are Global Trading Corporation, Leon Securities and Investment, Portment Cement, Modern Properties, Prashad Paradise Resort, Unique Investment and Securities, Hasan Abashan Company Ltd, Platinum Endeavours, Dynamic Venture, Reliable Enterprise, Paradise International, Leader Business Enterprise, Pushti Vegetable Ghee, Unitex Steel Mills and Unitex Cement Ltd.
Earlier on January 5, Islami Bank Bangladesh Ltd saw several major shifts in policy and operations that some insiders claim were rife with irregularities and benefited interests that have been gaining control of the bank. The chairman, vice-chairman and managing director of IBBL all abruptly resigned.
Following the change, a number of foreign investors sold off their shares in IBBL, which were allegedly bought by S Alam Group. As of September this year, S Alam Group owns 25% of the shares of IBBL.
Furthermore, the current IBBL chairman, who was appointed at the time, is a representative of Armada Spinning Mills, also allegedly a sister concern of S Alam Group.
S Alam Group representatives could not immediately be reached for comment.