Bangladesh Bank governor Md Mostaqur Rahman said on Friday that emergency liquidity support sought by Islami Bank Bangladesh PLC would be extended within the next few days.
He made the remarks at a post-budget press briefing organised by the government in the capital Dhaka.
Responding to a question, the central bank governor assured depositors of the private bank in the country that they could withdraw their deposits at any time.
Facing challenges, Islami Bank has recently sought liquidity support of Tk 10,000 crore from the central bank.
Mostaqur said that the Bangladesh Bank had a number of tools to manage the situation, with some measures to be implemented in the coming days.
Rejecting allegations of unlawful interference by the central bank in the management of Islami Bank, he said that the appointments of the chairman and board members were made in accordance with the rules.
He said that they had asked Islami Bank to bring down the advance-deposit ratio after it rose to 97–98 per cent, higher than the regulatory limit of 92 per cent.
On June 10, the Bangladesh Bank appointed an observer to the board of Islami Bank Bangladesh PLC, which had recently been reconstituted by the central bank.
The appointment came as a group of customers and stakeholders had continued protests since late May against the appointment of former Bangladesh Bank deputy governor Md Khurshid Alam as chairman of the bank.
The protesters demanded the resignation of Khurshid and the reinstatement of former managing director Md Omar Faruk Khan, who resigned on May 24 along with then chairman M Zubaidur Rahman.
Following their resignations, the Bangladesh Bank appointed Khurshid as chairman and facilitated subsequent changes in the bank’s board structure.
The protests disrupted board activities, triggered concerns among depositors, who rushed to withdraw large amounts of deposits, and prompted calls from bankers for a quick resolution to the dispute.
