Dhaka, Bangladesh
Seven directors quit after SIBL boardroom coup

Seven directors quit after SIBL boardroom coup

Weeks after a hostile takeover of Social Islami Bank Ltd or SIBL, seven board members of the lender have resigned. On Oct 30, The bank’s chairman, executive chairman and managing director were replaced following a boardroom coup. The bank’s chairman retired major Md Rezaul Haque, Executive Committee chairman Md Anisul Hoque and managing director Shahid Hossain have stepped down. It had appointed former Chittagong University vice-chancellor Professor Anwarul Azim Arif as Chairman. First Security Bank Additional MD Kazi Osman Ali has been made MD of SIBL while NRB Global Bank Vice Chairman Belal Ahmed is Chairman of the Executive Committee. Four independent directors and three sponsor directors resigned on Monday during a board meeting, SIBL Chairman Anwarul Azim Arif said on Tuesday. “They have resigned citing personal reasons,” Arif, who was appointed after last month’s takeover”, said. A senior SIBL official said the four independent directors who resigned, are Abdur Rahman, Abdul Mohit, AFM Asaduzzaman and Muinul Hasan. The three sponsor directors are Hakim Md Yousuf Harun Bhuiyan, Lily Amin and Afia Begum. On Monday, SIBL appointed nine members to the board: seven independent directors and two sponsor directors, said the SIBL official asking not to be named. The names of the new board members are yet to be available. The takeover followed a tug-of-war over the ownership of SIBL that started in the beginning of this year. United Group bought around 31 percent shares of the bank at the time and tried to take control by nominating directors for the board. Failing in its move, the Group stopped buying shares of the bank. Later, 20 organisations affiliated with S Alam Group bought the shares through block trading. They also bought shares from other sources. The organisations used in buying SIBL shares are Global Trading Corporation, Leon Securities and Investment, Portman Cement, Modern Properties, Prasad Paradise Resort, Unique Investment and Securities, Hasan Abason, Platinum Endeavours, Dynamic Venture, Reliable Enterprise, Paradise International, Leader Business Enterprise, Pushti Vegetable Ghee, Unitex Steel Mills, and Unitex Cement Limited. The firms used Al Amin Centre at Dilkusha in Dhaka and S Alam Bhaban in Chittagong as their addresses. In 2002, Bangladesh Bank removed SIBL directors Kamal Uddin Ahmed, Taslima Akhter, Shah Alam and Jahura Alam on charges of concealing information about their connection with defaulter Homeland Footwear. The punitive action was taken as per Section 46 of the Bank Company Act-1991. The four later filed a writ petition with the High Court Division against the central bank action. As the High Court rejected the petition, they moved the Appellate Division. In 2011, the Appellate Division of the Supreme Court had upheld a High Court judgment that affirmed Bangladesh Bank’s action terminating the four directors. Following the apex court’s judgment, general manager of Bangladesh Bank (governor’s secretariat) A F M Asaduzzaman said that the Supreme Court passed its judgment in favour of the central bank. “After the Supreme Court verdict, the four have ceased to be directors of SIBL,” he added. In 2007, The Bangladesh Bank decided to release the First Security Bank Ltd from its list of ‘Problem Banks’. The BB puts a bank in the ‘Problem Bank’ category if its financial condition is in distress. The First Security Bank improved after its new management injected fresh funds. S Alam Group took over the bank earlier. The third generation private bank will now be placed in the BB ‘early warning system’ (EWS) list, leaving three banks the Oriental Bank Ltd, Social Investment Bank Ltd and Bangladesh Commerce Bank Ltd in the problem bank category. With the inclusion of the First Security Bank in the EWS, the number of banks in the category has risen to 10 from 9. Currently, National Bank Ltd, United Commercial Bank Ltd, Pubali Bank, the City Bank, IFIC Bank, Shahjalal Islami Bank, AB Bank, Al-Arafah Bank and the Premier Bank are in the EWS. Pubali Bank, Uttara Bank, National Bank, National Credit and Commerce Bank, the City Bank, UCBL had been in the list of problem banks earlier. Of them, NCC and Uttara Bank showed progress and the BB relieved them from observation.

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