Parliament on Tuesday passed the much-talked-about ‘Grameen Bank Bill 2013’ paving the path for bringing the leading microcredit institution under the strong watch of the Bangladesh Bank.
The bill, abolished ‘The Grameen Bank Ordinance 1983’ promulgated during the military rule of Gen HM Ershad, three decades ago, also “made the law more time befitting”.
The Grameen Bank, a Nobel Peace Prize-winning microfinance organisation and community development bank, makes small loans to the impoverished women without collateral.
As of October, 2011, it has 8.349 million borrowers, 97 percent of whom are women. With 2,565 branches, GB provides services in 81,379 villages, covering more than 97 percent of the total villages in Bangladesh.
Finance Minister AMA Muhtih moved the bill in the House, which was passed by voice vote amid absence of the opposition. The Cabinet on October 3 approved the draft of the Grameen Bank Bill 2013.
The Bill stated that the headquarters of the Bank will be situated in Dhaka.
The authorised capital of Grameen Bank was TK 350 crore earlier. Now it will be increased to Tk 1,000 crore and there will be 10 crore shares of the Bank.
The Bank’s paid-up capital will be increased to Tk 300 crore from Tk 50 crore. The government shares of the paid up capital will be 25 percent and the government could increase its paid up capital from time to time.
As per the new law, the bank will have to consult with the government before taking any policy decision.
The Board of the Bank will comprise 12 members. Of them, three will be given from the government while rest of the members will be elected from the shareholders.
The managing director of the Bank will be a director, but he will not have the voting right.
The tenure of the Board of Directors will be three years. Earlier, there was no specific tenure for the Grameen Bank’s board of directors
No member of the Board, except the managing director or CEO, will get the chance to be the Director of the bank for more than two consecutive terms.
The managing director will be chosen by a selection committee that will select a three-member panel. It would need prior approval from Bangladesh Bank to appoint one of them as managing director.
The managing director will be allowed to serve the Bank up to the age of 60 years.
Like the other banks, Grameen Bank will also have to submit its annual report to the Bangladesh Bank.
Dr Muhammad Yunus, former Grameen Bank Managing Director, on October 17 last severely criticised the government’s move to bring the microfinance institution under the Bangladesh Bank supervision.
“We’ll break the hands that will try to take control of it (Grameen Bank),” Dr Yunus said at a function in Chittagong.
Source: UNB Connect