Grameen Bank goes under full state control today

With the expiry of tenure of the nine elected female board members today, Nobel winning micro-credit organisation Grameen Bank would run by government-appointed people.

However, the female representative directors, who has since the beginning been opposing the amended Grameen Bank Act 2013, said they will continue to go to the board meetings even if they are not invited, until a new full-fleged board is elected and made functional.

Sources said a four-member quorum for the board has already been created and they will run the bank under the amended act. An internal election commission will hold fresh elections to elect nine new female board members within a year.

M Aslam Alam, secretary of the Bank and Financial Institutions Division, told the Dhaka Tribune yesterday that they are still looking for a retired district judge who will be appointed as the election commissioner for conducting the election of new members.

Banking Division sources said Finance Minister AMA Muhith has personally contacted several retired district judges but none of them were interested in becoming the commissioner to conduct the election.

The three people appointed by the government for running the Grameen Bank (GB) are: Khondaker Muzammel Huq, chairman of the GB board of directors; Suraiya Begum, secretary of the Statistics and Informatics Division; and Shah Alam Sarwar, managing director of the IFIC Bank Ltd.

The fourth member of the quorum is acting managing director SM Mohiuddin, who is not a board member but generally attends board meetings.

Tahasina Khatun, GB director representative from Mymensingh and a pro-Yunus borrower, told the Dhaka Tribune yesterday: “If the representatives of poor female borrowers lose their position in the board, it will have a negative impact on the bank’s activities.”

She also said: “Since October, there has been no meeting of the board of directors. Now the authorities are not calling meetings because of the hartals and blockade enforced by the BNP-led alliance.”

Tahasina said election of directors under the new act will pave way for political influence on the bank.

“We hope that the government will direct the authorities to make sure that the existing female board members continue to hold their positions until their successors take over,” she said.

Finance Minister Muhith has said in the past that the board of directors has not been functioning properly because the pro-Yunus members would oppose any decision taken at board meetings.

The other outgoing female directors are Mosammat Sultana from Sylhet, Sajada from Chittagong, Rehana Akter from Comilla, Saleha Khatun from Gazipur, Parum Begum from Dinajpur, Marina from Bogra, Shahida from Jessore and Momana Begum from Patuakhali.

They represented a total of 8.4 million borrowers from 2,500 branches of the bank across the country.

The bank was formed in 1983 under a military ordinance during the regime of HM Ershad. Muhammad Yunus was its founding managing director from the beginning.

In 2011, Bangladesh Bank removed Yunus on the ground that he had crossed the permissible age for the post of the bank’s chief. The position has since remained vacant.

In December 2010, a documentary aired on a Norwegian television alleged that Yunus had transferred foreign money, given to Grameen Bank, from one account to another. It heaved a wave of controversy both at home and abroad.

It is claimed that since inception, the bank has cycled over $10bn through poor households in rural Bangladesh as credit that has been paid back nearly to the fullest.

Yunus was awarded the 2006 Nobel Peace Prize, along with Grameen Bank, for their efforts to create economic and social development.

The government now owns around 25% share in GB; before August 2013, the government had 3.25% stake.

Economist AB Mirza Azizul Islam, also adviser to a former caretaker government, told the Dhaka Tribune: “The trend is towards diluting the role of the board of directors and concentrating power in the hands of government appointees.”

He said: “With these unnecessary changes, the government is tinkering with a system that has  allowed Grameen to prosper while many state-run banks are embroiled in scandals.”

He also said: “The basic structure of Grameen is changed through amendment of the law. The worry is that the poor women who are the rightful owners of the bank will be disenfranchised.”

Source: Dhaka Tribune

One Response to Grameen Bank goes under full state control today

  1. And its staff would be manned (A-Z) on top level by incompetent party sycophant and would ultimately be destroyed like all other government agency/organisation.

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