The much-talked-about “Bank-Company (Amendment) Bill 2018” has been passed in the parliament with a provision to allow upto four members of a family to become directors of any bank and the directors to hold their posts for nine years consecutively.
Finance Minister AMA Muhith moved the bill in the House on Tuesday, seeking amendment to the Bank Companies Act 1991. It was passed by voice vote.
According to the existing Bank-Company Act 1991, two members of a family can be directors of a bank, while the tenure of a bank director is three years and the director can be disqualified for re-election on completion of two consecutive terms (six years) unless s/he elapsed three years.
But the proposed law states that a director can be disqualified for re-election on completion of nine consecutive years unless s/he elapsed three years.
Arguing for allowing four members instead of existing two from a family to become directors of a bank, the objective of the bill states that if any member of a family conducts separate business and pays tax, the person can't be called a dependent on the family.
But such members of a combined family can't be the director due to the existing provision if two of them already are. So an amendment to the provision was proposed, it added.
The Cabinet cleared the draft of the bill on May 8, 2017.
In 2013, the government amended the act restricting the number of directors from a family on the board to maximum of two to check irregularities and indiscipline, said officials.
In October 2016, Bangladesh Association of Banks, an organisation of the private bank owners, at a meeting with the finance minister demanded an amendment to the act.
Talking on the bill, Rustam Ali Farazi said the amendment to the bill astonished him as this was brought just to protect the interest of some individuals.
"There is nothing here for the interest of the mass people," he said.
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He mentioned that the amendment was brought only to give the bank ownership to the founding directors forever.
"Good governance has to be established in banks and the bank management has to be streamlined," he said.
Rustam Ali Farazi said the amendment will invite a great disaster and this is an ominous sign for the banking sector.
"We cannot enact any law to protect the interest of the individuals," he said.
Nurul Islam Milon said the country's banking system has been on the verge of ruination.
"The government has no control over the banking system," he said.
He claimed that the amendment was brought to the act to completely destroy the banking system.
Rawshan Ara Mannan said all banks will turn into family banks following the amendment.
Fakhrul Imam, Nurul Islam Omar and Nur E Hasna Lily Chowdhury also opposed the amendment.
Jatiya Party stages walkout over Bank Company Bill passage
The main opposition staged a brief walkout from parliament protesting the bill.
Talking to reporters, Opposition Chief Whip Tajul Islam Choudhury said they staged walkout as finance minister in his speech said there is no more scope to make any change in the bill before the placement of amendment motions in the House.
"Since we have not placed our amendment motions for the bill, there is no scope for the finance minister to say that it is not possible for him to accept amendment proposals and he requested us to withdraw our amendment proposals," he said.
Tajul said at this stage they tried to bring the issue to notice of deputy speaker who was in the chair, but he did not allow us to speak.
"This is why we staged walkout, otherwise we will stay till the last moment," he said.
Jatiya Party Presidium Member Kazi Firoz Rashid told reporters that the passage of the amendment bill will pave the way to enhance influence of some families in Bangladesh’s banks.
Jatiya Party MPs returned to the House after the passage of the bill.
Earlier, the opposition MPs strongly criticised the amendment bill in the House saying that it will protect interests of some particular individuals not common people.