ABB welcomes dissolution of Islami Bank board

The Association of Bankers, Bangladesh (ABB) has welcomed Bangladesh Bank governor's decision to dissolve the board of directors of Islami Bank, including its chairman, and facilitate a fresh start for the institution.

In a statement today from Mashrur Arefin, chairman of ABB and managing director of City Bank, the association described the decision as timely and prudent.

"As the Islami Bank issue had acquired political overtones and given the bank's systemic importance, ABB had expressed its deep concern to the governor on June 10. We conveyed that an early resolution would be beneficial for the industry, as the situation was no longer confined to a single institution — its impact was being felt across the banking sector.”

“We believe the decision taken yesterday by the central bank is commendable. We hope it will restore stability and rebuild the confidence of depositors, investors and stakeholders," according to the statement.

With nearly 30 million customers, a vast deposit and investment base, the country's largest remittance network and a major role in international trade finance, Islami Bank's stability is directly linked to the stability of the broader economy.

“The recent protests raised serious concerns about the bank's governance, liquidity and depositor confidence. We believe the central bank's decision will help allay these concerns."

ABB said it expects substantial progress in good governance, accountability, a banking environment free from political influence, and the recovery of non-performing loans.