Orgs related to bank directors cannot be involved in purchase for banks

The Bangladesh Bank has directed the commercial banks not to involve their directors or institutions concerned with their interests in the purchase made by the banks. 

According to a circular issued by the central bank on Wednesday, a number of directors of commercial banks or institutions concerned with their interests were found involved in the purchases made by those banks. 

This violates the rules made for avoiding conflict of interests and ensuring the equality of interests of the customers.

This is hindering the establishment of good governance in the banks. Therefore, from now on, directors and organisations related to their interests will not be able to be involved in purchasing and procuring any product or service for the bank, said the central bank.

In a circular issued earlier, the central bank instructed the directors, managing directors or chief executive officers of banks and the officers two levels below them to submit the details of their own and family business interests to the concerned bank at the end of every year. They were instructed to submit the details for a year by 20 January of the following year.

The circular also said the statements should be presented at the banks' board meetings and their proper preservation should be ensured.