BB may dissolve NRB Commercial Bank's board

Bangladesh Bank may dissolve the board of four-year-old NRB Commercial Bank and remove its managing director Dewan Mujibur Rahman for gross irregularities.

The development comes as the central bank was dissatisfied with the explanations given by NRBC Bank Chairman Farasath Ali and its CEO Rahman against the show-cause notices it had served earlier on 10 counts of wrongdoings, including signature forgery, interference of outsiders in the board and corruption.

The replies from Ali and Rahman contained many wrong information with the intent of misguiding the authorities, said a central bank official.

Yesterday, the Banking Regulation & Policy Department of the central bank submitted a review report to a standing committee of the BB formed to look into the NRBC Bank case.

The report suggested dissolution of the board and removal of the top executive as per the banking laws.

The standing committee will now ask the board members and the top executive to appear in a hearing before recommending their removal to the BB governor, the official said.

“It seems the board of directors has failed to uphold the banking companies act to protect the interest of the depositors and the public,” said the show-case notice sent to Ali in March. The other notice, sent to Rahman, said he had failed to discharge his responsibilities properly.

All the irregularities were inter-linked and took place with the involvement of the board and the management. As the MD, Rahman never informed the BB about the irregularities, the notice said.

After being slapped with the show-cause notices, both the chairman and the MD had filed writs with the High Court. The court, however, dismissed the petitions on March 28 and also ordered the BB to take action as per procedure.

In 2006, the central bank dissolved the board of Oriental Bank, now ICB Islamic Bank Ltd, for corruption and mismanagement.