MD MEHEDI HASAN

The Bangladesh Bank (BB) has decided in principle to reject a bid by former owners of troubled Social Islami Bank PLC to reclaim control, as the banking regulator moves ahead with the merger of five shariah-based banks, according to top BB officials.

They said the application submitted by former owners of Social Islami Bank PLC (SIBL) to opt out of the merger process is “inconsistent” and “lacks sufficient information”.

Moreover, the applicants had sought 10 years to repay the bank’s dues to the central bank, which is “not acceptable”, said the BB officials on condition of anonymity.

They said the bank resolution department of the BB has therefore decided in principle to reject the application and continue with the merger process under the Bank Resolution Act 2026.

Arief Hossain Khan, executive director and spokesperson for the BB, said the central bank remains firm on the merger plan. “The merger process is ongoing, and media reports claiming that it will not take place are incorrect,” he said.

At a recent meeting of the bank resolution department, BB Governor Md Mostaqur Rahman instructed officials to continue with the merger process of the five troubled lenders.

BB officials also said the Ministry of Finance has agreed to proceed with the process.

As part of the next steps, the ministry and the BB have begun interviewing candidates for the post of managing director of the merged Islamic bank.

On Wednesday, six bankers were interviewed at the BB headquarters in Dhaka. Five more are scheduled for interviews on Sunday this week.

As part of its banking reform initiatives, the interim government approved the Bank Resolution Ordinance 2025. Under it, five crisis-hit lenders -- First Security Islami Bank, Global Islami Bank, Union Bank, Social Islami Bank and EXIM Bank -- were brought under the merger process.

The BB later issued a licence for a new state-owned entity, Sammilito Islami Bank PLC, in November last year, which is expected to become the country’s largest state-owned shariah-based lender.

So far, the government and the central bank have injected Tk 35,000 crore in capital and provided additional liquidity support to stabilise the new bank.

After the Bangladesh Nationalist Party (BNP) came to power following the national election in February, the ordinance was amended and enacted as the Bank Resolution Act 2026. The revised law included provisions allowing former owners to reclaim merged banks under relatively easy terms.

Under the clause, former directors or owners of banks under merger or listed for merger can pay 7.5 percent upfront of the amount injected by the government or the BB to regain control.