The recent approval of the Bank Resolution Ordinance by the national parliament has sparked concerns due to last-minute amendments allowing merged banks to revert to previous owners. Originally designed to address fraudulent use of bank assets, the ordinance aimed to protect depositors and maintain financial stability through resolution measures like appointing administrators and transferring assets.
In December 2025, five Shariah-based private banks were merged into Sommilito Islami Bank after facing distress from looting. The chairman of Exim Bank, Nazrul Islam Mazumder, had ties to Nassa Group, while the other banks were linked to the S Alam Group in Chattogram.
Sommilito Islami Bank’s capital stands at Tk 35,000 crore, with the government contributing Tk 20,000 crore. The remainder will be given to depositors as shares, supported by funds from the Deposit Insurance Trust Fund and Bangladesh Bank loans.
As of December 2025, the merged banks held total loans of Tk 196,827 crore, with Tk 165,781 crore in default. Concerns persist over recovering defaulted loans, returning funds to depositors, and sourcing new capital. The amendment allowing former owners to reclaim banks raises doubts about the merged bank’s success.
The conditions for regaining ownership mandate an upfront payment and settling all claims and liabilities. However, skepticism remains about whether past violators can comply, questioning regulatory effectiveness.
The amendment process mirrors past controversial changes in banking legislation, raising suspicions of undue influence favoring certain parties. The move undermines efforts to recover laundered funds and erodes public trust in financial governance.
Overall, the amendment to the Bank Resolution Ordinance signifies a concerning trend of accommodating past wrongdoings at the expense of transparency and stability in the financial sector.
