After First Security Islami Bank (FSIB), now Union Bank and Global Islami Bank (GIB) have agreed to Bangladesh Bank’s merger bailout, while Exim Bank stated that it was not ready to be part of the process just yet.
The latter informed that it wanted to focus first on implementing its own recovery plan and needed some time to do so.
Global Islami Bank on Thursday agreed to a merger, as announced by its chairman, Mohammad Nurul Amin, following a Bangladesh Bank hearing on Thursday.
According to Amin, the bank's current loan portfolio stood at Tk14,000 crore, of which Tk12,000 crore was borrowed by S Alam Group through various entities.
He also stated that most of these loans have defaulted, with collateral covering less than 25% of the exposure.
Export Import (Exim) Bank of Bangladesh presented a turnaround roadmap in a meeting with Bangladesh Bank Governor Dr. Ahsan H. Mansur and his deputies at the BB headquarters on Wednesday.
The central bank governor joined the meeting virtually with the bank's board members.
Exim Bank chairman Md Nazrul Islam Swapan told reporters after the meeting that they presented how the lender will bounce back from the present situation, with intensified focus given on issues like recovery, capital injections, and rebalancing investment portfolios.
But the central bank officials instructed the bank to make some revisions to the rebound roadmap before presenting it in the next meeting with top central bank executives.
"We'll do the same and place it in the next meeting," said Swapan, who took charge of the bank's board after the dissolution of its previous board by the banking regulator as part of its banking-sector reform recipes undertaken after the governance changeover through last year's uprising.
The crisis-ridden First Security Islami Bank (FSIB) on Tuesday accepted the merger option rolled out by the central bank, while Union Bank agreed to the revival plan on Wednesday, said central bank officials.
Union Bank agrees
Earlier in the day, the board of members of Union Bank also sat for another meeting where they had accepted the central bank's M&A initiative.
Talking to reporters, Union Bank's chairman, Md Fariduddin Ahmed, said the depositors come to get their money back, but the lender is unable to pay back.
"It would be good for the industry as quickly as we take decisions like mergers and acquisitions regarding such liquidity-crisis banks," he said.
Citing an example, the bank's chairman said the controversial S Alam Group had taken away assets amounting to Tk28,000 crore under various names, whose trace has not been found yet.
FSIB okay with the merger
Earlier on Tuesday, First Security Islami Bank, during a meeting with Bangladesh Bank officials, expressed its support for the merger initiative aimed at forming a new 'bridge bank.'
After the meeting, Chairman Mohammad Abdul Mannan said that the bank had no objection to the central bank's decision and emphasized that the safety of depositors would be ensured by Bangladesh Bank.
He also disclosed that S Alam Group had withdrawn Tk38,000 crore from First Security Islami Bank using anonymous loans, as direct borrowing under its own name was not permitted.
