Bankers on Wednesday expressed deep concern over the continuing unrest at Islami Bank Bangladesh PLC, warning that the crisis could have wider repercussions if not resolved quickly.
The concern was raised at a meeting between Bangladesh Bank governor Md Mostaqur Rahman and chief executives of banks, where the situation at Islami Bank emerged as a key issue alongside governance, credit growth and digital banking initiatives.
Speaking to reporters after the meeting at the central bank headquarters, Association of Bankers, Bangladesh chairman Mashrur Arefin said that the ongoing instability at Islami Bank was no longer confined to a single institution.
Islami Bank is the largest private-sector Islamic bank in the country, he said, adding that the current unrest was having a negative impact on the entire banking sector and bankers were deeply concerned about the situation.
Mashrur, who is also managing director and chief executive officer of City Bank, said that the meeting discussed that the issue had evolved beyond a purely banking matter and had taken on political dimensions.
He said that the governor was trying to facilitate a resolution through dialogue among the concerned parties in order to restore stability as quickly as possible.
The latest unrest at Islami Bank was triggered by protests over the appointment of former Bangladesh Bank deputy governor Md Khurshid Alam as chairman of the bank.
The dispute has led to demonstrations, disruptions to board activities and growing deposit withdrawals in recent weeks.
On Wednesday, a group of depositors submitted memorandum to finance ministry demanding removal of the chairman.
He said that the governor also instructed banks to ensure accurate reporting of information to the Credit Information Bureau or CIB.
The meeting also discussed measures to increase credit flow to businesses through a proposed Tk 60,000-crore refinancing package.
According to Mashrur, the fund is being planned jointly by the government and the Bangladesh Bank and will primarily support micro, small and medium enterprises.
Another major issue discussed was the accuracy of trade-related data submitted by banks.
Mashrur said that delays and errors in reporting export and import information often created difficulties in national economic accounting.
He noted that significant discrepancies were frequently found in the declared prices of imported goods, raising concerns about over- and under-invoicing.
To address the problem, bankers and regulators stressed the need to verify international market prices through global platforms and online sources before opening letters of credit and approving trade transactions.
ABB members also discussed a joint nationwide campaign from July 1 to promote the Bangla QR payment system through billboards, social media and merchant outlets.
All deputy governors and senior officials of the Bangladesh Bank, along with managing directors and chief executives of commercial banks, attended the meeting.
