Bangladesh Bank Governor Ahsan H Mansur has said that existing Islami Banks will be merged to form two large-scale banks.
He shared this information while addressing the inaugural session of the Annual Banking Conference of the Bangladesh Institute of Bank Management (BIBM) as the chief guest on Wednesday.
Governor Mansur said that efforts are underway with foreign agencies to recover laundered money, adding: “Legal and ethical measures are both required in this regard. Those involved in money laundering will face a difficult life to deter future attempts. Cooperation from all concerned parties is essential.”
He further said: “Islami Banks will be merged to establish two major Islamic banks. Political support is necessary to sustain reforms in the banking sector."
He added: "Regardless of political changes, these reforms must continue, and the central bank’s autonomy must be preserved.”
Referring to changes in bank boards, he said: “Boards of banks where irregularities have been found have been restructured in the interest of depositors. Initially, 11 banks underwent changes, followed by two more the next day."
He added: "Additionally, one bank has independently restructured its board. Amendments are being made to the Bank Company Act to define qualifications for board members and independent directors.”
He also said: “Bangladesh Bank itself has been a contributing factor to the problems in the banking sector. The central bank is being strengthened. It faces various pressures and dual authority in the banking sector."
He continued: "Work is in progress to enhance autonomy and supervision so that the central bank becomes more effective. The aim is to detect and understand existing and potential issues in advance."
"While the central bank does not wish to interfere in banks’ day-to-day operations, it will closely monitor whether boards and management fulfil their responsibilities. Reporting will be fully automated, and all submissions will be done online,” he added.
The governor further said: “Islami Banks will be given a completely new shape. At present, there is one large and several small Islami Banks—many of which are in distress. These will be merged to form two major Islami Banks."
He added: "Legal Law and supervision system will be introduced for Islami Bank. All actions will align with global best practices.”
