Muhith publicly rebukes Bangladesh Bank

Finance minister AMA Muhith on Tuesday publicly rebuked the central bank claiming that the Bangladesh Bank (BB) has no jurisdiction to recommend reconstitution of the board of a commercial bank.

“It is not BB duty to reconstitute the board of a commercial bank” Muhith told reporters when asked for his reaction to BB letter to the finance ministry recommending reconstitution of the bank board. Muhith was talking to the reporters after attending a workshop as chief guest, organised by University Grants Commission (UGC).

When contacted BB Governor Dr Atiur Rahman however did not want to make any comment on the issue.

The central bank on Monday requested the finance ministry to reconstitute the Board of Directors of Sonali Bank Ltd for its failure to stop Tk 3,832-crore loan scam.

In a letter to the finance minister, Bangladesh Bank Governor Atiur Rahman said the nature of the irregularities at the state-run commercial bank was very serious.
“It is not credible at all that nobody had noticed it although there are a number of stages at the governing and management structure in the bank,” said the letter.

The Bangladesh Bank, under Clause 46(6) of the Bank Company Act 1991, has sent a report to the finance ministry when it unearthed massive irregularities and corruption to the tune of Tk 38 billion in the bank.

The central bank in the report said the nature of irregularities was very serious and it was not credible that the board of directors of the bank concerned did not notice such massive corruption.

Clause 46(6) of the act stipulates that the central bank would submit report to the government on the conduct of the Chairman, Directors or Chief Executive, and that the government would consider the report with utmost importance.

The Bangladesh Bank through audits found out that some officials of the Ruposhi Bangla Hotel branch of the bank were involved in an embezzlement of Tk 3,547 crore. The Hallmark Group is alleged to be the beneficiary of Tk 27 billion out of the total amount.