Chaos in bank boards

The Association of Bankers, Bangladesh (ABB) has recently called upon the central bank to step in to halt the sudden changes taking place in leading banks' boards that have changed ownership of late. The call is an urgent and crucial one. Massive changes that include the resignation of independent directors and the sweeping changes in the composition of boards have done little to inspire confidence amongst depositors. We have editorialised this issue in the past, particularly, certain actions which have gone against banking norms and the strange silence of Bangladesh Bank on these happenings.

The question that has to be asked is, what compels the central bank to remain silent on the issue? We have been told that the central bank is taking measures. What are these measures? And when will those measures be implemented?

We are as much in the dark as the depositors of these banks. Indeed, the radical changes that have taken place in some of the biggest banks like Islami Bank Bangladesh and some other Shariah-based banks have created a sense of uncertainty bordering on panic.

It is time for policy support and directives from the central bank to stem the tide of such arbitrary changes. While central bank officials have sought to soothe tensions arising from these incidents, it will require more than just assurances that these matters are being looked into. If changes need to be made, they must be made in a manner that does not upset the stakeholders of banking institutions, of which depositors represent the largest segment.