Grameen Bank electoral rules may see changes

The government may amend the electoral rules of microcredit lender Grameen Bank so that it can pick nine directors from the borrowers by itself — like it has done since its inception.

Now the finance ministry will take opinions of the attorney general on how to amend the Grameen Bank (Election of Directors) Rules 2014, said a senior official of the finance ministry yesterday.

The in-principle decision to make changes to the electoral rules came at a high-level meeting at Finance Minister AMA Muhith’s official residence in Dhaka on Sunday night.

Fazle Kabir, governor of the central bank; Md Eunusur Rahman, senior secretary of the banking division; Suraiya Begum, senior secretary of the Prime Minister’s Office and a director of Grameen Bank; K Mozammel Haque, chairman of Grameen Bank; and Ratan Kumar Nag, acting managing director of Grameen Bank, were present at the meeting, among others.

The meeting came following a letter from the Grameen Bank chairman on July 16. Haque is seeking approval to change some of the electoral provisions so that the bank can appoint one of its officials to oversee the election of directors from borrowers.

“Grameen Bank should be allowed to run in the way it was allowed to run in the past,” Haque told The Daily Star earlier referring to the letter.

If the changes are approved by the government, the Nobel Peace Prize-winning organisation would get back its power to elect directors — an exercise that has been taken over by the government in 2014.

Three government-appointed directors have been running Grameen Bank since February 2015 after the tenure of the nine elected directors came to an end.

Although the rules for the election of directors were changed in April 2014, no election has taken place since.

The new electoral rules gave the central bank the task to form a three-member commission to elect the nine directors. But the central bank objected to the additional responsibility.

Later, the banking division amended the rules in October that year, saying the government itself would hold the elections. But still, the election has not taken place.

Haque’s letter said the proposed changes aim to help ease the current complexity as the new rules are not being applied.

If the proposed amendments are approved, the election of directors could be organised in the quickest possible time, the letter said.

“This will ensure the formation of the full board. At the same time, this will diminish the importance of the ongoing case in courts.”

The Grameen Bank board is a 12-member body. Nine board members are directly elected by shareholders and borrowers of the bank, while the rest, including the chairman, are nominated by the government.

Meanwhile, the nine elected directors demanded that their directorship in the board remain intact as the election schedule is yet to be announced and the election did not take place as per the new rules. They filed a writ petition in court in 2015.

The case is under trial, said the Grameen Bank chairman in the letter.

Sunday’s meeting also discussed about the overall situation at the bank and the court cases it faces.

A Grameen Bank official yesterday said the government would not have to go to parliament to bring amendments as the Grameen Bank Act 2013 has given power to the finance ministry to amend the electoral rules of the bank if necessary.

Source: The Daily Star