Written by The Banking Post
The government is preparing to take action against the auditors of five recently merged banks over allegations that manipulated financial statements misled small investors into buying their shares from the stock market.
Finance Adviser Salehuddin Ahmed said on Tuesday that authorities are reviewing how investors made their decisions based on the banks’ published accounts, which had shown profits prior to the merger.
“Yes, we will take action against them. We are examining in what context investors bought the shares of these banks. Let’s see what we can do,” he said while briefing reporters after meetings of the Advisers’ Council on Government Purchase and Economic Affairs.
Before August 5, 2024, the banks had reported profits in their audited financial statements, which encouraged investors to purchase shares. However, following the merger late last year, the share values were declared zero and trading was suspended, leaving millions of small investors with losses.
The five ailing lenders—First Security Islami Bank, Social Islami Bank, Global Islami Bank, Union Bank and EXIM Bank—were merged to form Sammilito Islami Bank PLC. Since then, affected investors have been demanding refunds for their investments.
The finance adviser said compensating general shareholders would be highly complex, noting that investors had bought shares to become owners of the banks. Although the government earlier said it would explore possible remedies for small investors, no concrete steps have yet been announced.
Responding to other issues, he said a decision on a new pay scale for government employees would come after the report of a 21-member review commission is submitted. On energy concerns amid global uncertainty, he said the government has adopted a long-term plan to ensure energy security, warning that industrial production would suffer without stable supplies.
On inflation, he observed that price pressures are not driven by demand and supply alone, adding that effective political governance is essential to stabilise commodity markets.
Earlier, the government approved the procurement of essentials to stabilise markets. This included the purchase of 10 million litres of refined soybean oil for distribution at subsidised rates during Ramadan, at a total cost of Tk 1.80 billion, and the import of 40,000 tonnes of urea fertiliser from Saudi Arabia at a cost of Tk 1.91 billion.
