ABB welcomes Bangladesh Bank move on Islami Bank board dissolution
In a statement issued today the association said the decision would help restore confidence among depositors, investors and other stakeholders.
The Association of Bankers, Bangladesh (ABB) has welcomed Bangladesh Bank's decision to dissolve the board of directors of Islami Bank, including its chairman, saying the move is timely and necessary to stabilise the institution.
In a statement issued today (15 June) from the office of ABB Chairman and City Bank Managing Director Mashrur Arefin, the association said the decision would help restore confidence among depositors, investors and other stakeholders.
ABB said it had raised concerns with the central bank governor on 10 June, noting that developments at Islami Bank were affecting the wider banking sector.
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It added that the situation had gone beyond a single institution and had acquired broader implications for financial stability.
The statement said ABB had earlier suggested that the issue be resolved through dialogue and consensus among relevant stakeholders, given its growing sensitivity.
It described the central bank's decision to dissolve the board as commendable in this context.
ABB said Islami Bank's scale made its stability critical for the financial system, citing its large customer base, deposit and investment portfolio, remittance network and role in trade finance.
It added that recent unrest had raised concerns over governance, liquidity and confidence among both domestic and foreign stakeholders.
The association said it expected the central bank's intervention to help ease these concerns and support a return to normalcy at the bank.
Looking ahead, ABB called for improvements in governance, accountability and operational transparency at Islami Bank.
It also stressed the need to ensure a banking environment free from political influence and to address the bank's non-performing loans.
The statement further cautioned that instability or external pressure in the banking sector sends a negative signal to the wider financial system.
It urged the authorities concerned to treat the matter with seriousness and ensure long-term stability in the sector.
