Unrest grips banking sector amid fight over ownership

The country’s banking sector is witnessing growing unrest, particularly in institutions where ownership had forcibly been changed during the reign of the recently ousted government.

Movements to reclaim ownership have emerged as new owners, who took control of certain banks, are now accused of depleting their resources.

Bankers have staged demonstrations at various banks, demanding the restoration of seized bank ownerships, the removal of those involved in money laundering, the cancellation of illegal appointments, and the reinstatement of employees who were wrongfully dismissed.

On Sunday, a clash between two groups vying for control of Islami Bank Bangladesh Limited left six people with gunshot wounds.

Meanwhile, former officials of IFIC Bank protested in front of its head office, demanding reinstatement. Additionally, a group of employees from Social Islami Bank PLC called for the dissolution of the bank’s board.

The banking sector’s instability deepened further after the governor of Bangladesh Bank, Abdur Rauf Talukder, resigned following the government’s fall.

Before this, angry central bank officials had forced the resignation of four deputy governors, an advisor, and the head of the Financial Intelligence Unit, leaving the sector leaderless.

Unprecedented protests at the regulatory body, Bangladesh Bank, occurred last Wednesday, sparking similar demonstrations at various banks on Thursday and Sunday. Bankers struggled to find a proper platform to voice their grievances.

Speaking to reporters at the secretariat on Sunday, Finance Adviser Dr Salehuddin Ahmed said those involved in the clashes and shootings in front of Islami Bank would soon be held accountable.

He added that the incident would be discussed with law enforcement agencies to ensure that the guilty parties are brought to justice.
Dr Ahsan H Mansur, executive director at the Policy Research Institute, suggested restructuring in the country’s banking sector.

He said that while reforming the entire sector at once is impractical, immediate action is required to reorganise the central bank’s administrative structure and resolve ownership disputes.

He also warned that without a rapid improvement in law and order, any economic measures would be ineffective. Urgent intervention is needed to address the ongoing unrest in various banks, prevent further protests, and mitigate the risk of mass withdrawals.

Mohammad Nurul Amin, former chairman of the Association of Bankers Bangladesh, stressed the importance of restoring good governance in the banking sector.

He called for banks to operate according to the law, free from political interference, with their chairmen, board members, and managing directors performing their duties independently.

He also said it is required to recover bad loans and exercise caution in loan disbursements to avoid exacerbating liquidity crises.

Clash over Islami Bank control leaves six injured

A violent clash erupted between two groups competing for control of Islami Bank in front of the bank’s head office, resulting in six gunshot injuries. Three of the injured, in critical condition, were rushed to the hospital, according to eyewitnesses.

The incident unfolded as officials allegedly appointed by the S Alam Group, which took over the Shariah-based bank in 2017, attempted to enter the bank’s headquarters. They were blocked by a group of officials claiming to be shareholders, leading to the clash.

A group of Islami Bank officials and employees, demonstrating under the banner “Anti-Discrimination Bankers,” began protesting last week against being deprived of benefits and promotions over the past 15 years.

Their demands include the resignation of the bank’s top officials, including the managing director, following the forced resignation of Additional Managing Director Muhammad Qaisar Ali.

Sources within Islami Bank reported that employees hired after 2017 have been barred from entering the bank’s head office since Sunday morning, as announced by long-standing staff members.

These new employees, predominantly from Patiya upazila in Chattogram and known as “Patiya employees,” gathered outside the bank in response. Mohammed Saiful Alam, chairman and managing director of S Alam Group, was born in Patiya.

In 2017, Chattogram-based S Alam Group took control of Islami Bank, resulting in the recruitment of nearly 14,000 new officers and employees, nearly doubling the bank’s workforce, which had around 8,000 employees before the takeover.

Since the political upheaval in the country, Islami Bank has been mired in unrest. Following the government’s fall, a protest rally at the bank’s head office announced that employees hired after 2017 would not be allowed to enter.

CBA leader Anisur Rahman said that executives hired after 2017 would no longer be permitted to enter the bank.

He vowed to cancel any appointments made through irregular means since 2017 and to reinstate employees who were unlawfully terminated during this period.

He also promised proper promotions for those denied over the past seven years.

Protests by sacked IFIC officials

Sacked officials from IFIC Bank demonstrated in front of its head office, demanding their jobs back. They called for the resignation of all directors from BEXIMCO Group, including Salman F Rahman, chairman of IFIC Bank and a former adviser to Sheikh Hasina, and his son Ahmed Sayan Fazlur Rahman, vice-chairman of the Bank, from their positions.

On Sunday, nearly 200 former IFIC officers and employees protested outside the bank’s head office in Dhaka, accusing Salman F Rahman of embezzling billions of takas, allegedly with the aid of former MD Shah A Sarwar who is now an adviser to the bank.

The protesters claimed that Sarwar created a hostile work environment, forcing many employees to resign.

The protesters issued nine demands, including the removal of those “illegally” appointed to the bank and the immediate reinstatement of employees forced to resign since 2013. They also called for promotions, salary increments, and the payment of dues for those who have reached retirement age.

SIBL employees call for board dissolution

A group of employees from Social Islami Bank PLC demanded the dissolution of the bank’s board, protesting under a human chain in front of the National Press Club in Dhaka.

The officials, who were appointed before S Alam Group took control of SIBL in 2017, alleged that the group had seized the bank by taking the previous board of directors hostage at gunpoint.

The demonstrators further accused S Alam Group, along with its associates and with the direct support of the Awami League government, of embezzling thousands of crores of taka from the bank’s stakeholders and laundering the money abroad.