Sammilito Islami Bank Bank has filed around 10,000 lawsuits to recover defaulted loans and is preparing to initiate more legal proceedings, as the bank steps up efforts to address alleged corruption, loan fraud and misuse of assets under its previous ownership and management.

The information was disclosed at a high-level review meeting between Bangladesh Bank Governor and officials of the Bank Resolution Department (BRD) on Thursday. The meeting reviewed the bank’s activities over the past six months, including its board and management, employees, branch consolidation and technological integration.

Bangladesh Bank officials said the bank’s restructuring and related activities are being carried out under the central bank’s supervision, with the BRD regularly monitoring progress and conducting follow-ups.

The central bank said operations of the country’s largest Shariah-based bank are gradually being restored under strict supervision. Measures are also being taken to allow depositors and customers to withdraw money from any branch of the bank.

A forensic audit into alleged irregularities, corruption, loan fraud and misuse of assets during the previous ownership and management is now at its final stage. The audit is aimed at identifying those responsible for the alleged irregularities.

Besides legal action, the bank has introduced settlement-based alternatives such as an exit policy and alternative dispute resolution (ADR) to accelerate recovery of defaulted loans.

Over the past six months, several key restructuring initiatives have progressed. A new board of directors has been formed with independent directors given greater prominence, while a new managing director and chief executive officer was appointed on July 16.

Necessary changes to the ranks, responsibilities and organisational structure of around 16,000 employees have also been finalised. To reduce operating costs and improve efficiency, the bank has started rationalising and merging 780 branches and 1,500 business units.

A common interface is also nearing completion to enable customers to withdraw funds from any branch of the five merged banks. The bank is simultaneously integrating its core banking system (CBS), SWIFT, RMA and other IT infrastructure.

Bangladesh Bank said ensuring transparency, accountability and good governance remains its key priority for the state-owned Islamic bank, which began operations with Tk 35,000 crore in capital. The central bank will continue monitoring efforts to recover idle and stuck funds and return them to productive sectors.