No Regular MD in Any of Six State Banks: Interim-Era Appointees Removed in Two Phases

None of the six state-owned commercial banks now has a regular managing director (MD). The vacancy has arisen in all six banks — Sonali, Agrani, Janata, Rupali, Bangladesh Development Bank (BDBL) and BASIC Bank.

This time, the BNP government has removed the MDs appointed during the interim government. A similar situation had arisen once before in 2024, after the fall of the Awami League government.

On 19 September 2024, the interim government, in one decision, removed six MDs who had been appointed for three years during the Awami League government. This time, the MDs appointed during the interim government have been removed in two phases.

In the first phase, on 2 September, the remaining terms of Agrani Bank MD Md Anwarul Islam, BASIC Bank MD Md Kamruzzaman Khan and Bangladesh Development Bank (BDBL) MD Md Jasim Uddin were cancelled.

In the second phase, on 19 October, the remaining terms of Sonali Bank MD Md Shawkat Ali Khan, Janata Bank MD Md Mojibur Rahman and Rupali Bank MD Kazi Md Wahidul Islam were cancelled in the same way.

Although there was a time gap between the two events, the report says one similarity is clear: the MDs were removed after a change of government, before their appointment terms had ended. This has raised questions about the continuity of banks' top leadership, the stability of appointments, and the assurance of staying in post on the basis of professional qualification.

Related sources said a political decision had been taken beforehand behind this round of removals. After a direction from Finance Minister Amir Khasru Mahmud Chowdhury, the Financial Institutions Division sent letters to the board chairmen of the concerned banks asking them to complete the formal process of cancelling the MDs' remaining terms.

Alongside removing the MDs, the path to new appointments has also been eased. Last Monday, the policy on appointment, promotion and posting to top positions of state-owned banks, specialised banks and financial institutions was amended. Under the new rule, a person can become MD even without two years' experience as a DMD. However, the condition of 20 years' work experience in a bank or financial institution remains in place.

The process of appointing new MDs to the six banks is almost at its final stage. Simultaneous appointments are expected at the start of next week. The process of taking intelligence reports before the new MD appointments has also been completed.

However, Financial Institutions Division sources said false information was found in several intelligence reports. One banker was never a branch manager, yet a report brought allegations of irregularities from his time as a branch manager. Another was said to have a case with the ACC, but the Financial Institutions Division, taking information from the ACC, found no existence of any case. The matters have been informed to the finance minister, the sources said.

Bankers say the MD post of a state-owned bank should not be a place to seat a person of a government's choice. They note that top leadership decisions are tied to these banks' depositors' money, loan management, defaulted-loan control and overall financial stability.

The report says that if the culture of MDs changing whenever the government changes continues, the importance of political loyalty may grow instead of professionalism in running banks. It remains to be seen whom the government appoints and how it chooses them.