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SIBL’s chairman, AMD resign

Social Islami Bank Limited’s Chairman Md Mahbub Ul Alam and Additional Managing Director Abu Reza Md Yeahia resigned last week.

Both cited “personal reasons” in their resignation letters, according to officials of the Shariah-based bank on condition of anonymity. 

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An official of the bank said that Alam went to the United States last week and soon after, he submitted his resignation letter to the board.

Yeahia, a former deputy managing director of Islami Bank Ltd Bangladesh (IBBL), has not come to the bank since January 29, said the official.

Alam and Yeahia could not be reached for comments despite repeated attempts.

Zafar Alam, managing director of SIBL, did not respond to The Daily Star’s request for comments.

Alam served on the board of SIBL as a director nominated by Abasan (Pvt) Ltd, a concern of Chattogram-based business conglomerate S Alam Group.

Before joining SIBL, he served First Security Islami Bank as an adviser and IBBL as its managing director.

Abu Reza Md Yeahia

Abu Reza Md Yeahia

The resignations came at a time when SIBL continues to make headlines for irregularities and anomalies.

A BB official said that the bank recently disbursed a large amount of loans breaching banking norms, which worsened its financial health.

In December, the BB instructed five Shariah-based banks, including SIBL, to inform it if a loan of Tk 10 crore and above is approved. Furthermore, they were asked not to disburse any loan beyond Tk 50 crore. The move is aimed at restoring discipline at the lenders.

The four other banks are IBBL, First Security Islami Bank, Union Bank and Global Islami Bank.

The banks also took emergency funds to the tune of Tk 14,790 crore from the central bank in December to tackle the acute liquidity crisis. Such funds are usually taken during extraordinary circumstances.

The central bank has recently investigated allegations of gross irregularities at IBBL over the disbursement of loans amounting to Tk 7,246 crore last year.

Reports about the investigation’s initiation led to a confidence crisis of depositors in the five banks, which are either fully or partially controlled by S Alam Group.

This compelled the five to take liquidity support of Tk 5,250 crore from the central bank last month.

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