Nazrul Islam and Shakhawat Hossain

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  Grameen Bank has a staggering 55 sister concerns, but none of the nine women directors of the trailblazing microcredit organisation found any place in the affiliated entities, the bank insiders said.

The directorship of these concerns was determined only for personalities, including Prof Jamilur Reza Chowdhury, Muyeed Chowdhury and Jafar Ullah, they added.

Fifty organisations, known as non-profit entities under Grameen family, are already in operation and the rest in the pipeline.

An investigation committee, formed early this year, is examining the relations of the deposed chief executive officer with Grameen Bank and its sister concerns.

Muhammad Yunus who won the Noble peace prize jointly with Grameen Bank in 2006 has not considered any of the nine women as worthy for directorship of other ventures.

The insiders said Yunus has been holding chairmanship of more than 40 affiliated bodies, including Grameen Communications, Grameen Trust, Grameen Telecom, Grameen Cybernet Ltd, Grameen Kalyan and Grameen Shakti.

Many of the GB employees were given responsibilities in the affiliated organisations, they further said. Preparation of a list of various subsidiary bodies and other enterprises of Grameen family was one of the major terms of reference of the review committee after alleged fund transfer by GB had raised controversies at home and abroad.

Led by Prof Monwar Uddin Ahmed of economics department of Dhaka University, the probe body was asked to examine the entire gamut of the Grameen issue.

The committee members got baffled with the number of entities as sister concerns of GB sprouting one after another.

They are simply surprised because of the links between Grameen and its sister concern and their complicated nature.

Prof Monwar said the probe committee unearthed interesting clues and tried to make forays into the entities.

He, however, refused to disclose the findings for the sake of further investigation. “All I can say that the findings are surprising.”

The committee was asked to prepare a report with recommendations on the overall situation in respect of control, management, transparency and accountability of GB and consider the possible jurisdiction of the Microcredit Regulatory Authority Act 2006.

GB was established in 1983 under an ordinance as a non-banking financial institution. Its ordinance of 1983 was amended twice — first in 1986 reducing the government’s share from 60 percent to 25 percent and second in 1990 when the managing director’s appointment was transferred from the government to the board of directors.

Muhammad Yunus was made MD for an indefinite period since 2000 which Bangladesh Bank said illegal.

Last week Bangladesh Bank relieved Yunus of MD from the bank.

News: Daily Sun/Bangladesh/06 Mar 2011

Noman Chowdhury and Maksud Joarder

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  Western countries established Yunus as an ethical pillar of capitalism and which is why they are taking his side, said noted economists and academics of the country.

They also asked Yunus to refrain himself from involving foreign countries in the country’s internal affairs. The world capitalism especially the US has tried to give capitalism a human face through Yunus’s Grameen Bank (GB) model. It is they who established him as the ethical pillar of capitalism and very naturally the US government will try to save Yunus as he directly serves its national interest, said Prof Shahiduzzaman of International Relations of Dhaka University.

The relations between Bangladesh and western countries might deteriorate over the Yunus issue as the Bangladesh government was too late to take action against Yunus, said Shahiduzzaman adding that the government might have done it earlier as he has been under question for quite a long time.

Economist Anu Mohammad was highly critical of Yunus saying, “He is a citizen of Bangladesh. Even if the government makes any mistake about Yunus people of Bangladesh will talk about it not the foreigners.”

“It is not the government but the image of the country is being tarnished due to controversial role of Yunus,” he said adding that there are no beneficiaries of Yunus’s Grameen Bank in Bangladesh.

“Instead of people of the country foreigners are taking his side to make the government’s decision controversial,” he noted.

He suggested that Prof Yunus should bring a stop to foreign intervention immediately for his own interest.

“The allegation of charging higher interest, unethical transfer of money and holding post for long has made the role of Grameen Bank as well as Dr Yunus controversial,” Dhaka University Political Science Department Prof Gias Uddin Molla told daily sun.

“The government has the authority to take action against the wrongdoers of GB as it is an organisation functioning within Bangladesh,” he said adding that the government was on the right track to take decision over the issue.

Dr Delwar Hossain who teaches International Relations at Dhaka University said the relation with the western world will depend on how the government handles the issue.

Prof Abdul Bayes of Jahangirnagar University, however, said the issue should have been solved in a dignified manner. And again it is not expected that a person like Dr Yunus should hold the position of MD of Grameen Bank forever.

Bangladesh Bank on Wednesday removed him from the post of managing director of Grameen Bank on the ground that GB board did not take approval from the authorities when it reappointed Yunus as MD on 12 March 1999 for an indefinite period, which violated the Grameen Bank Ordinance-1983.

After his elimination from country’s leading micro lending organisation envoys of western countries reacted at a meet with Finance Minister AMA Muhith on Thursday at the latter’s office at the secretariat.

At the meeting US Ambassador to Bangladesh James F Moriarty said the US government is deeply troubled at the removal of Prof Yunus through only a letter.

News: Daily Sun/Bangladesh/06 Mar 2011

Bankers’ Forum has recognised the social activities of seven commercial banks awarding them ‘Performance and CSR Awards 2009-2010’.

Seasoned lawyer Barrister Rafuque-Ul-Huq handed over the trophy among the executive heads of the respective banks at a function at the city’s CIRDAP auditorium yesterday.

The awarded banks are Pubali Bank Ltd, Islami Bank Ltd, Standard Chartered, Social Islami Bank Ltd, Dhaka Bank Ltd, Shahjaalal Islami Bank Ltd and Commercial Bank of Ceylon.

Barrister Rafique said banks have a huge contribution to country’s development since a long. He also mentioned the history of CSR activities of the country. “It’s not a charity but a social obligation,” Rafique said.

The leading lawyer made an appeal to bankers for extending their CSR activities to country’s health and education sectors.

Earlier, high officials of different banks termed CSR as a tool for long term benefit as it matters in banking sector.

The function was chaired by MA Khaleque, president, Bankers’ Forum.

News: Daily Sun/Bangladesh/06 Mar 2011

Banks face a period of over-regulation caused by public outrage over lax supervision that led to the global financial crisis, OECD chief Jose Angel Gurria said Friday.

Ever since the 2007-2008 slump, regulators worldwide have moved to strengthen supervision of large banks and other financial institutions.

“We blew it so badly that right now there is a pendular movement toward too much regulation,” Gurria told 600 senior financiers attending the spring meeting of the Washington-based Institute of International Finance (IIF).

“Don’t fight it—it is going to happen no matter what.

People are too scared, people are too angry, the consequences have been too massive,” Gurria told the bankers’ forum in New Delhi.

Financial institutions in mature economies are being blamed for irresponsible lending and risk-taking that led to the worst global downturn since the 1930s Great Depression.

“We share the responsibility” for the events leading up to the crisis, said Gurria, who heads the Paris-based Organisation for Economic Development and Cooperation.

“The banks are a very good villain (in the public eye) and maybe we will have a period when we have too much regulation as an inevitable political result of the crisis and then maybe we will get it right,” he said.

Gurria’s comments came as the IIF, which represents 430 institutions from over 70 countries, said the regulatory crackdown on financial bodies could hurt economic recovery by curbing banks’ critical funding role.

“Never before have so many regulatory reforms been determined or planned” by different nations, said IIF chairman Josef Ackermann.

Ackermann called for better global coordination in drafting regulatory policies on the need for banks to hold more capital, pay higher taxes and other reforms in order to avoid the creation of “uneven playing fields.”

He urged authorities around the world to take stock of regulations that “are in train” to see how these will affect the financial system.

Planned new bank capital rules known as Basel III to come into effect in 2013 will oblige banks to hold more than three times the level of capital that they were required to hold before, making them better equipped to handle shocks.

Ackermann said that there should be no haste to impose new rules in addition to the Basel III regulations.

The Group of 20 top wealthy and emerging nations are aiming for even tighter rules on top of Basel III for so-called systemically important financial institutions or SIFIs that would include higher capital safeguards.

“We believe there should be no rush to judgement regarding capital surcharges on such firms,” Ackermann said.

Ackerman said even the Basel III plans could “undermine” banks’ ability to provide vital basic services such as credit lines to corporations, funding for firms to conduct international trade and services to ordinary borrowers.

“We have to have a balance that is not going too overboard with regulation, that will get our economies growing again,” said Rich Waugh, a vice-chairman of the IIF board of directors and chief executive of Canada’s Scotiabank.

Speaking separately, Lael Brainard, US Under-Secretary for International Affairs, told bankers that Washington was working to ensure “globally synchronised markets” so that financial activity “does not not migrate to jurisdictions where standards are weaker.”

News: Daily Sun/Bangladesh/05 Mar 2011

The total deposit of Islami Bank Bangladesh Limited (IBBL) reached Tk 295.70 billion as on February 28 this year, showing a growth by 19 per cent over the same period of the last year.

This was disclosed at the performance review meeting of the top executives of head office and zonal heads of the bank held at its head office in the city yesterday, said a press release.

IBBL acting chairman Eng Mostofa Anwar was present at the meeting as the chief guest. Managing director Md Abdul Mannan chaired the meeting attended by deputy managing director Mohammad Shamsul Haque, Md Habibur Rahman, Md Setaur Rahman, and Nurul Islam.

IBBL’s total investment reached Tk 304.71billion showing a growth by 24 per cent against the same period of the last year.

News: Daily Sun/Bangladesh/06 Mar 2011