Premier Bank paid Iqbal Tk 10cr for unused office spaces

Premier Bank paid Tk 10 crore to HBM Iqbal, the former chairman of the bank, for office space in one of his buildings that the private commercial lender did not use or rent.

A central bank inspection revealed the undue benefit that Iqbal received from the bank during his tenure as chairman.

The head office of Premier Bank is situated in the capital's Banani at Iqbal Center, a building owned by HBM Iqbal and his family members.

However, for over 40 months since 2020, Iqbal and his family members received Tk 10.31 crore as rent for the 20th and 21st floors of Iqbal Center despite the bank neither renting nor using those floor spaces, according to the inspection findings.

Central bank officials stated that this was a clear violation of banking rules and regulations.

A former member of parliament, Iqbal is also the chairman of Premier Group of Companies Ltd.

In January this year, after 26 years at the helm, Iqbal stepped down from his role as chairman at the private commercial bank he co-founded in 1999. His son, Mohammad Imran Iqbal, took his place as chairman.

When contacted, Arief Hossain Khan, an executive director and spokesperson of the Bangladesh Bank, told The Daily Star that the central bank sought an explanation from the bank after detecting the irregularities, but the explanation was unsatisfactory.

Finally, the central bank instructed the lender to recover the additional funds, for which the lender sought time, he added.

Premier Bank was given one year to recover the funds and was instructed to keep the central bank updated on the progress.

The Daily Star tried to contact Mohammad Abu Jafar, managing director and CEO of the bank, via phone and text messages since Tuesday, but he did not respond till the filing of this report.

This correspondent also paid a visit to the head office of Premier Bank on Thursday to meet Jafar, but the communications officials at the bank said the managing director was on leave due to health reasons.

This latest chapter is not the only example of Premier Bank's favoritism toward its former chairman.

In November last year, the Bangladesh Financial Intelligence Unit (BFIU) instructed all banks to freeze the personal and solely owned company accounts of Iqbal, then chairman of Premier Bank, and his family members.

However, the BFIU found that Premier Bank had unfrozen his account and allowed the withdrawal of Tk 1.11 crore and $30,000.

An official of the BFIU, requesting anonymity, told The Daily Star that the bank violated the law by unfreezing Iqbal's account and allowing fund withdrawals.

He added that a fine was imposed under Subsection 6 of Section 23 of the Money Laundering Prevention Act, 2012. The anti-money laundering agency fined the lender Tk 1.11 crore and $30,000 (in equivalent local currency) for this violation.

Iqbal—a former Awami League lawmaker—and several members of his family reportedly left Bangladesh following the ouster of the Awami League government in August last year.