B Mirror Report: Bangladesh Bank has taken a series of prompt measures to restore stability at Islami Bank Bangladesh PLC and will continue providing necessary support to strengthen depositor confidence, Governor Md. Mostakur Rahman said on Friday.
Speaking at a post-budget press conference organized by the Ministry of Finance at Osmani Memorial Auditorium in the capital, the governor assured depositors that there is no reason for concern, as the central bank remains committed to maintaining stability in the country’s largest Islamic bank.
“We want to support Islami Bank. Depositors who had been facing difficulties withdrawing funds are now gradually receiving their money,” he said, adding that Bangladesh Bank has taken necessary steps to improve the bank’s liquidity position and restore public confidence.
Regarding the appointment of the bank’s Managing Director (MD), Rahman said the application deadline was March 25. Following the collection and verification of reports from relevant agencies and interviews with candidates, a new MD was selected in May. The appointment was later approved through the committee led by the finance minister and endorsed by the prime minister.
The governor also noted that forming the board of the consolidated Islamic banking group took some time. The newly appointed chairman has already assumed office, and the board recently held its first meeting.
He identified the integration of the core banking software (CBS) of five Islamic banks as a major challenge but said Bangladesh Bank is actively working on the issue and expects visible progress within the next few weeks.
Rejecting allegations of undue government interference in Islami Bank, Rahman said Bangladesh Bank does not instruct banks on loan approvals, transfers, or promotions. “Such allegations have no basis,” he stated.
He explained that one member of the five-member board appointed under the interim government was replaced on March 16 following allegations of irregularities. Beyond that, the central bank has not intervened in the bank’s operations.
Referring to attempts to create uncertainty surrounding the resignation of Islami Bank’s chairman ahead of Eid, the governor said the bank is systemically important and therefore required prompt appointments to ensure the board maintained the minimum number of members.
“Bangladesh Bank has various tools at its disposal to manage the situation. If necessary, those measures will be applied within the next few days,” he said.
Reassuring depositors once again, Rahman said they would be able to withdraw their funds whenever needed. He noted that Islami Bank’s Advance-to-Deposit (AD) ratio increased from around 93 percent in July last year to 97–98 percent in March, an unusually high level. As a result, the bank has been instructed to reduce the ratio.
“There will be no major problems involving Islami Bank going forward. The bank’s management and board are alert, and Bangladesh Bank is ready to provide emergency liquidity support if required,” the governor added.
