Share trading of 5 troubled Islamic banks suspended before merger
The banks to be merged are – First Security Islami Bank, Union Bank, Global Islami Bank, and Social Islami Bank and EXIM Bank
The trading of shares of each of the five troubled Islamic banks set for merger shall remain suspended with effect from today (6 November) until further notice, according to five separate disclosures in the banks' names from the Dhaka Stock Exchange.
The banks to be merged are – First Security Islami Bank, Union Bank, Global Islami Bank, Social Islami Bank and EXIM Bank.
Yesterday, Bangladesh Bank formally sent letters to the boards of the five banks, declaring them non-viable within the framework of the Bank Companies Act.
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Depositors have no reason to worry; their money will be safe
The regulatory body, the Bangladesh Securities and Exchange Commission (BSEC), also issued a directive to relevant authorities, " In view of the abovementioned issues and sources, it is hereby informed that, pursuant to Section 15 of the Bank Resolution Ordinance, 2025, Export Import Bank of Bangladesh PLC, Social Islami Bank PLC, First Security Islami Bank PLC, Global Islami Bank PLC and Union Bank PLC have been declared invalid by Bangladesh Bank with effect from 5 November 2025.
"In such a situation, it is hereby directed to take necessary measures to suspend the transactions of the said banks with effect from today, 6 November 2025."
Although the full merger is expected to take about two years, the central bank has assured that small depositors (deposited up to Tk2 lakh) can withdraw their funds, with the process set to begin within a month.
'Money will be safe'
However, large-sum depositors will receive their money in phases.
This move follows the central bank's formal intervention to consolidate the failing institutions.
The suspension of trading comes immediately after BB took the first concrete step toward cleaning up the sector: dissolving the boards of the five banks and appointing administrators yesterday (5 November).
The central bank had formally sent letters declaring the five institutions non-viable within the framework of the Bank Companies Act. Five BB executive directors have been appointed as administrators to the banks: Sala Uddin for Social Islami Bank, Mohammad Abdul Hashem for Union Bank, Mohammad Badiuzzaman Dider for First Security Islami Bank, Md Muksuduzzaman for Global Islami Bank, and Md Sawkatul Alam for EXIM Bank.
BB Governor Ahsan H Mansur stated that the newly-appointed administrators will review the assets and liabilities before completing the full merger process, which is expected to take about one to two years.
Despite the turmoil, the central bank assured the public that depositors are safe and urged against panic withdrawal.
"The new bank [formed by merging the five institutions] will be stronger than any other bank. Depositors have no reason to worry; their money will be safe," the governor had said.
He added, "Every depositor will receive a market-based profit rate. Once the new bank starts operations, the profit rate will be determined in line with the market."
"Our goal is to keep banking operations functional. Like the banks are open today, they will remain open tomorrow. Remittances, payments, and clearing will continue as before," said Mansur.
He said that these banks have around 75 lakh deposit accounts, all of which will remain secure after the merger. "At this stage, there are no plans for layoffs. Workforce reorganisation, if needed, will happen in a later phase. For now, existing staff will manage operations."
The news, however, is grim for equity investors as Governor Mansur confirmed that under the Bank Resolution Ordinance, the shares of sponsor directors and ordinary retail shareholders will effectively become zero, as he said, "For instance, if a bank's Tk10 share has a net asset value (NAV) of negative Tk350 to Tk420, it means the share has no real value – effectively, it has become zero."
Bondholders, who, over time, invested over Tk4,000 crore in the five banks, are likely to recover their funds, with the BB set to issue a gazette notification soon explaining the repayment process.
The resulting merger is expected to create a single institution that would become the country's largest Islamic bank, boasting assets of roughly Tk2.20 lakh crore and a planned paid-up capital of Tk35,000 crore — the highest in Bangladesh's banking history.
