Bangladesh Bank does not know its business, says Muhith as he backs Agrani Bank MD's extension

Bangladesh Bank's objection to Syed Abdul Hamid continuing as Managing Director of Agrani Bank Limited was unacceptable, Finance Minister AMA Muhith says.

Staff Correspondentbdnews24.com
Published : 12 July 2015, 06:14 PM
Updated : 12 July 2015, 06:14 PM

The government, therefore, extended Hamid's tenure in the state-owned bank by another year, the minister has said.
 
The finance ministry on July 9 issued the order announcing the extension, a day before Hamid was to run his term.
 
Hamid has served as the bank's MD for five years in three terms.
 
The ministry's Bank and Financial Institutions Division (BFID), before renewing Hamid's tenure, had written to the central bank for a no-objection.
 
Bangladesh Bank had opposed the BFID decision citing irregularities in loan distributions, but Muhith's ministry overruled the objection, in what is being seen by some as a clear violation of the Bank Company Act, 1991.
 

Syed Abdul Hamid

Hamid's extension despite loan scams in two other state-run banks—Sonali Bank and BASIC Bank—has been widely criticised by the media.
Muhith on Sunday told
bdnews24.com that the central bank's objection was unacceptable to him.
"That's why he was appointed (again) despite their objection. Bangladesh Bank don't know what is their business.
“His (Hamid) tenure was extended in the last three years. I didn't receive any complaints," the minister said.
The finance ministry in the July 9 order had also said 'Bangladesh Bank's approval in this matter is not needed'.
However, Bank Company Act makes it mandatory to heed to the central bank's objection to any such appointment.
It says no banking company except specialised banks should appoint its managing directors or chief executive officers, whatever be the name of the office, without Bangladesh Bank's approval.
MDs and CEOs of all banks in Bangladesh have always been and are being appointed by following this Act.
According to Bangladesh Bank officials, they had stated there had been irregularities in loan disbursement of nearly Tk 5 billion from Agrani Bank in their objection to Abdul Hamid's extension.
The central bank had suspected Hamid's involvement in the financial impropriety.
Tk 3 billion was given to the Moon Group in loans. "Appropriate security money against the loan had not been collected, and now all that bank money is at risk," a central bank official told 
bdnews24.com.
Bangladesh Bank had given full details of the loan irregularities and sent the investigation report to the finance ministry, the official said, adding that the ministry had ignored the reports.
Abdul Hamid joined Janata Bank as a senior principal officer in 1985 and was made general manager in 2000.
He joined Agrani Bank as general manager in 2005.
He was promoted to deputy managing director two years later.
He also served the bank as managing director (additional responsibility).