Jamaat expresses concern over banking sector 'crisis'

Bangladesh Jamaat-e-Islami Secretary General Mia Golam Parwar has expressed deep concern over what he described as ongoing disorder in the country’s banking sector, accusing the government of interference and mismanagement.

In a statement issued on Saturday, he said the banking sector is one of the main driving forces of the national economy and stressed that a sound banking system is essential for economic progress.

He alleged that instead of focusing on restructuring banks weakened by looting during the “fascist era”, the government was busy implementing its own agenda. According to him, most banks in the country are currently facing severe crises.

He claimed that several Shariah-based banks, even after being brought under a resolution framework, are still unable to return depositors’ money. He also said many banks are failing to provide dividends and were suffering from acute liquidity shortages, while default loans are increasing day by day, creating what he termed a major threat to the overall economy.

Referring to the United Islami Bank initiative formed with five Islamic banks, Golam Parwar alleged that the initiative had collapsed due to the incompetence of the governor and unnecessary government intervention.

He said depositors are suffering significant losses and accused the government of placing its own people in several banks, thereby damaging financial discipline and creating mistrust and instability among customers.

The Jamaat leader also expressed concern over Islami Bank Bangladesh PLC, saying conspiracies were underway against the bank, which he described as one of the country’s leading banks in remittance collection, import-export activities and trade.

He alleged that efforts were being made to forcibly remove the bank’s legally appointed managing director and condemned what he termed government interference in the removal of the MD of a private bank.

Golam Parwar further claimed that attempts are being made to paralyse the bank by appointing unqualified individuals to its board. He said investment activities had already slowed and panic was spreading among customers.

According to him, such developments have put around 30 million depositors and nearly 8 million entrepreneurs and businesspeople -- directly and indirectly -- at risk, which could create a serious employment crisis in the country.

He also warned that since the bank handles nearly 30% of the country’s remittance inflow and a significant share of foreign trade, any instability involving the bank could damage Bangladesh’s international reputation.

“We believe that if the Islamic banking sector is destroyed, the entire banking sector will collapse,” he said.

The Jamaat secretary general further alleged that after assuming power, the government appointed a politically loyal businessman as governor of the central bank despite lacking sufficient qualifications apart from party allegiance.

He demanded the immediate removal of the “partisan governor” and called for the appointment of a nationally and internationally acceptable professional with expertise in the financial sector.

He also demanded reinstatement of the managing director of Islami Bank after leave and allowing him to work professionally. In addition, he called for dissolving the current board of the bank and forming a new board comprising qualified and experienced individuals familiar with Islamic banking.

Golam Parwar also urged the government to stop ‘interference’ in the banking and financial sectors, bring bank looters under legal action, and recover laundered assets from abroad.