Delta Life administrator withdrawn, new board to take over on Tuesday

The Insurance Development and Regulatory Authority (Idra) has withdrawn the administrator from Delta Life Insurance Company Ltd to let the reconstructed board of directors take the helm on Tuesday. 

On Monday, the insurance regulator sent its letter to the Delta Life administrator instructing him to hand over responsibilities of the company. 

"We are thankful to the Ministry of Finance, the new leadership of the Idra, the judiciary, our policyholders and shareholders," was Delta Life Director Zeyad Rahman's initial reaction following the development. 

The insurance regulator, as part of its amicable settlement with Delta Life's sponsor and shareholder-directors, mediated by the Ministry of Finance and approved by the Supreme Court, has also instructed its attorney to withdraw from all legal actions against the previously ousted directors of the life insurer.

Also, Delta Life's directors have already withdrawn all the ten pending court cases against the regulator. But, they would continue lawsuits against individuals accused of corruption and financial misconduct, said Zeyad Rahman. 

On 22 August this year, the Supreme Court approved an amicable settlement agreement between the Idra and Delta Life's directors who were ousted by the regulator in February 2021. 

Some new faces, both shareholders and independent directors, teamed up to form the new board which has been approved by the government and the Supreme Court. 

The new board, effective from 20 September, includes Delta's suspended Directors Suraiya Rahman and Zeyad Rahman, former Chief Executive Adeeba Rahman, and new Directors Hafiz Ahmed Majumdar, Md Jonaid Safiq, Shakib Aziz, Shakib Azad, and Chaklader Rezanul Alam.

Suspended board members were complaining that then Idra Chairman, M Mosharraf Hossain, solicited bribes, and being rejected, he suspended the board and appointed an administrator at Delta Life.

They filed 11 lawsuits against the regulator and its chairman, while the Idra conducted a series of audits within the firm, some findings of which were questioned by observers and the ousted board members.

Mosharraf, however, was forced to resign from his post earlier this year following anti-corruption actions against his crores of taka in undisclosed financial transactions and illicit stock trading, including shares of Delta Life, from several shady accounts.

The new board is all set to run the company and report progress to Idra periodically. Also, the Ministry of Finance is going to send an observer to the board of Delta Life.

Delta Life Insurance shares rose 188% in 2021 and the securities regulator later found that a group of market manipulators led by Abul Khayer Hiru were behind the play and who were consequently penalised. 

However, the stock rally was followed by a sharp correction — from the peak price of Tk239 per share in October 2021, to Tk110 in May 2022. 

Delta Life shares closed 0.1% lower at Tk155.3 each at the Dhaka Stock Exchange on Monday, compared to the previous trading day.