The controversial bank, which is often under fire for its alleged ties with terrorism financing, has also appointed Abdul Hamid Miah, incumbent managing director (MD) of Union Bank, the new MD.
Arastoo’s election and Abdul Hamid’s appointment were finalised during a meeting of the bank's board of directors on Thursday.
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Arastoo Khan, newly-appointed chairman of Islami Bank Bangladesh Limited[/caption]
Arastoo Khan will replace Mustafa Anwar, who has been at the helm of the bank’s board since June 2015 while Abdul Hamid is going to supersede Mohammad Abdul Mannan, who was appointed on May 2013.
Islami Bank Bangladesh Limited, which has often been under fire for allegedly financing terrorism, is finally being brought under the control of the government.
According to a 2016 exclusive report by the Dhaka Tribune, four new independent directors were inducted in the bank’s board in accordance with orders from the government’s high-ups.
At the time, banking industry analysts told the Dhaka Tribune that the government’s directive is part of its plan to appoint four directors of its own choice. They believe the government is taking control of Islami Bank through several major changes including the board of directors.
Also Read- Government taking control of Islami Bank?
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Md Abdul Hamid Miah, newly-appointed managing director of Islami Bank Bangladesh Limited[/caption]
Over the past few years, allegations were raised that the bank was involved in terrorist financing and funding political violence. Many quarters have called for ousting Jamaat-leaning personnel and the nationalisation of the bank. Gonojagoron Mancha and other progressive groups and parties as well as some Islamic parties have been demanding that the government take control of the bank. An intelligence agency working under the Prime Minister’s Office was assigned to investigate the issues.
In December 2015, Bangladesh Bank imposed special control over Islami Bank to protect the public interest and the depositors. The control means that the central bank now signs off on any appointment at the level of executive deputy managing director.
Also Read- How govt is taking control of Islami Bank
IBBL is the largest Sharia-based bank in Bangladesh. Since its inception its board has been populated with people associated with the Islamist political party Jamaat-e-Islami. Policymakers such as chairman and vice-chairman would be appointed from among party members or sympathisers. Executives and lower level employees are also from that political spectrum. Therefore the bank was heavily influenced by the party’s ideology.
The bank has therefore not been on good terms with the government. The finance minister and many policymakers have been known to issue statements against IBBL.