After Islami Bank, S Alam Group's control over Social Islami Bank ended yesterday after the Bangladesh Bank decided to dissolve the board of the Shariah-based bank that was heavily dominated by individuals linked to the conglomerate.

The central bank dissolved the previous 11-member board, whose chairman Belal Ahmed is the son-in-law of S Alam Group chairman Mohammad Saiful Alam. Five more relatives of Alam including his sister Badrun Nessa Alam and nephew Mahmudul Alam were on the board of SIBL.

The Bangladesh Bank also constituted a five-member board including Rezaul Haque, a sponsor-director of the bank.

The other directors are Maqsuda Begum, former BB executive director; M Sadiqul Islam, professor at the department of finance at the University of Dhaka; Md Morshed Alam Khandakar, former deputy managing director of Rupali Bank; and Md Anwar Hossain, a chartered accountant.

The new board was constituted as per section 45 of the Bank Companies Act, 1991 to protect the interests of depositors and ensure good governance, said the BB letter to the SIBL managing director.

The move to dissolve the board comes after a group of SIBL officials requested the BB governor to do so following the fall of the Sheikh Hasina government on August 5.

Alam is said to be a close associate of Hasina.

The group and its associates took out Tk 4,200 crore from the bank, which came under S Alam's control in 2017, according to central bank documents.

However, the actual amount taken is in the neighbourhood of Tk 15,000 crore, which would be about 41 percent of the bank's total outstanding loans at the end of last year, according to the bank's officials who spoke on the condition of anonymity.

The amount given to S Alam and its associate companies has left the bank with a deficit in its current account balance with the central bank for more than a year.

To plug the deficit, the central bank provided special liquidity support to the lender without any collateral on the orders of former BB governor Abdur Rouf Talukder.

As of August 7, the bank faced a current account deficit of Tk 2,877 crore with the central bank.

The liquidity support was stopped after Ahsan H Mansur took charge in the middle of August.

At the end of 2023, SIBL had Tk 9,568 crore in default loans but it showed only Tk 1,644 crore, according to a recent BB investigation.