FROM PAGE B1

partner within three years and is expected to be fully privatised within five.

“Finally, it has been assured that through this merger process, no employee will lose their job, and no depositor will lose their savings,” said Alam.

Central bank officials who are directly involved in the merger process said depositors of the merging banks would be allowed to withdraw up to Tk 2 lakh if they choose to close their accounts.

Larger deposits will be repaid in phases, while institutional depositors will be reimbursed through a separate mechanism, they added.

The merger is being carried out under the newly enacted Bank Resolution Ordinance 2025, which gives broad powers to restructure troubled banks.

The move follows forensic audits by international accounting firms earlier this year that showed an alarming level of financial distress in those five banks.

The audits found that non-performing loans (NPLs) accounted for 96.37 percent of total loans at First Security Islami Bank, 97.8 percent at Union Bank, 95 percent at Global Islami Bank, 62.3 percent at Social Islami Bank and 48.2 percent at Exim Bank.

As of May this year, combined deposits at these banks stood at over Tk 1.36 lakh crore, according to the Bangladesh Bank.

After the political changeover in August last year, the central bank dissolved the boards of these banks and appointed new ones. The forensic audit findings prompted the interim government to move forward with the merger.

Yesterday’s advisory council meeting also approved the draft Depositor Protection Ordinance, which proposes setting up a Depositor Protection Fund to be managed through a designated account at the Bangladesh Bank.