Written by The Banking Post
Bangladesh Bank (BB) moved up another step regarding merger of the five crisis-hit Islamic banks as the central bank on Tuesday allotted office space for the proposed nationalised unconventional bank to be formed through the merger.
The banking regulator on Tuesday officially allotted 2336 square feet of spaces for housing the proposed United Islami Bank PLC or United Islami Bank of Bangladesh PLC on 17th floors of Sena Kallyan Bhaban in the capital’s Motijheel area, according to BB sources.
Earlier, the central bank approved a plan to merge five financially troubled Islamic banks—First Security Islami Bank, Social Islami Bank, Global Islami Bank, Union Bank, and Export Import Bank of Bangladesh PLC (EXIM Bank)— to stabilise the financial sector.
The regulator took the decision due to their weak financial health revealed by a forensic audit conducted by global audit firms KPMG and Ernst & Young. The asset quality review found their non-performing loans were four times higher than previously reported.
The banks will be placed under temporary government control once the merger begins.
The move is part of the interim government’s wider effort to stabilise the banking sector, for which it passed the Bank Resolution Ordinance few months ago.
Under the merger plan, the banking regulator has already been selected five administrators who will take charge of the problem banks
