The Bangladesh Bank has stated that individuals or groups facing allegations of money laundering abroad will not be allowed to serve on the boards of any banks in the country.
The clarification was issued on Tuesday by Arief Hossain Khan, Executive Director and spokesperson of the central bank, to address public uncertainty regarding certain provisions of a recently promulgated ordinance aimed at reforming the banking sector.
The move follows concerns raised in the media and among the public about whether individuals previously associated with financial misconduct—including loan scams, irregularities, and money laundering—might be able to regain positions within bank ownership or management structures.
Responding to these concerns, Arief said, “The information presented in some media outlets regarding the recent reform ordinance has sparked various questions. There are fears that individuals or groups involved in past irregularities might find a way back into bank ownership or management.”
He clarified that the ordinance does not provide any unrestricted pathway for such individuals to re-enter the banking system. While certain provisions allow former directors or sponsor shareholders to apply for reinstatement of ownership, these are neither automatic nor broadly applicable.
According to the ordinance, former directors or sponsors may seek to recover their ownership stakes by settling 7.5 per cent of their outstanding dues. However, the central bank emphasised that such applications will be subject to thorough examination and strict regulatory oversight.
Each case will be assessed individually, taking into account the applicant’s financial track record, compliance with banking regulations, and any involvement in unlawful activities. The central bank underscored that allegations of money laundering abroad constitute a disqualifying factor for board membership.
Officials reiterated that the primary objective of the reform measures is to reinforce governance standards and safeguard the stability of the banking sector. Ensuring that individuals linked to serious financial misconduct do not influence bank management remains a central component of these efforts.
The clarification is part of a broader initiative by Bangladesh Bank to enhance transparency, accountability, and public confidence in the financial system as reform measures continue to be implemented.
Summary of Key Provisions
| Provision | Description |
|---|---|
| Ownership reinstatement | Permitted upon payment of 7.5% of outstanding liabilities |
| Approval requirement | Subject to detailed regulatory scrutiny |
| Disqualification criteria | Allegations of money laundering abroad bar board participation |
| Oversight mechanism | Case-by-case review of financial and compliance history |
The central bank indicated that additional guidance may be issued if required, as the implementation of the ordinance progresses.