Six Islamic banks are likely to be merged initially, said central bank officials.
He assured depositors their funds would remain safe during the transition, as the government would take over the merged banks
Forceful mergers of banks will not be the right step and banks should agree for the consolidation in the first place, said Mohammed Farashuddin, a former governor of the Bangladesh Bank
National Bank officials do not want the bank to merge with another entity.
Money deposited by individuals and institutions with banks, which have decided to go for mergers, will remain completely safe and secure, Bangladesh Bank said in a statement yesterday.
The Transparency International Bangladesh has urged the central bank to stop the process of merging weaker banks with the relatively stronger ones.
In general, five issues need to be borne in mind when it comes to bank mergers in Bangladesh.
A recent rush to withdraw money from the BASIC Bank and National Bank is worsening the situation the troubled institutions are facing.
As a state-run bank, BASIC Bank's officers and employees enjoy and job security alongside various employee benefits -- including salaries, provident fund facilities, gratuity, retirement allowance -- which may differ from those offered at City Bank.
Bangladesh Bank deserves credit for forging the deal of signing the MoU between EXIM Bank and Padma Bank on March 18.
The planned merger of Shariah-based Exim Bank and struggling Padma Bank is likely to take between 18 months to two-and-a-half years to complete, according to central bank officials.
The MoU will open the process of merger
The news that Shariah-based Exim Bank is going to merge with troubled commercial lender Padma Bank has taken the financial sector of Bangladesh by surprise.
Padma Bank, which has been struggling with the burden of toxic loans for years, will merge with EXIM Bank. It will be the first bank merger in Bangladesh
