BB asks 4 banks to reduce family members in boards - Share market analysis of dhaka stock exchange, Bangladesh

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13 October, 2014 10:57 AM Source: New Age
BB asks 4 banks to reduce family members in boards.jpg

 Bangladesh Bank on Sunday asked four banks to reduce the number of directors from a single family to two within seven working days.
The four banks—National Bank Ltd, Premier Bank, First Security Islami Bank and The City Bank—have more than two members of a family as directors in violation of the Bank Company Act (Amendment) 2013.
The BB issued separate letters to chairmen and managing directors of the four banks asking them to explain why they did not reduce the board members from a family by July 22, 2014 in line with the bank company act, a BB official told New Age on Sunday.
The BB asked the banks to reply its letter within seven working days.
The City Bank has five members of one family and four members of another family as board members
The NBL is maintaining five members of a family, Premier Bank four members while First Security Islami Bank three members of a family in their boards of directors, he said.
BB executive director SM Moniruzzaman told New Age on Sunday that the central bank had asked the four banks to inform it which two members of a family would be attached to the respective boards.
The revised bank company act set a deadline of one year to reduce the board members from a family which ended on July 22 this year, but the banks failed to comply with the direction, he said.
Against the backdrop, the central bank issued the letters to the four banks to comply with the act, he said.
Another BB official said that the central bank would take punitive measures against the four banks if they fail to fulfill the directions within seven working days.
He said that the financial health of the four banks had significantly declined in recent months due to the unwanted intervention in the board by the family members concerned.
The BB on Wednesday appointed an observer to National Bank following several alleged anomalies including higher number of board members from a family violating the act.
Influential board members of NBL recently forced the managing director of the bank to resign five months before the completion of his tenure.
NBL’s board members from a single family are Zainul Haque Sikder (chairman), Monowara Sikder, Parveen Haque Sikder, Rick Haque Sikder and Ron Haque Sikder
The City Bank’s directors from a family are Rubel Aziz (chairman), Aziz Al Kaiser, Tabassum Kaiser, Aziz Al Mahmood and Syeda Shaireen Aziz.
The bank’s directors from another family are Deen Mohammad, Mohammad Shoeb, Meherun Haque and Evana Fahmida Mohammad.
The Premier Bank’s directors from a family are HBM Iqbal (chairman), Moin Iqbal, Nawrin Iqbal and Mohammad Imran Iqbal.
First Security Islami Bank’s directors from a family are Mohammad Saiful Alam (chairman), Wahidul Alam Seth and Ahsanul Alam.

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