Depositors of five merging banks can now withdraw up to Tk 10 lakh

Depositors of the five merging Islamic banks will now be allowed to withdraw up to Tk 10 lakh not only for their own medical treatment but also for other emergency needs.

The central bank took a decision in a board meeting held at the Bangladesh Bank headquarters in Dhaka today.

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Previously, withdrawals under the central bank's special scheme were limited to a depositor's own medical expenses.

Under the revised policy, funds can also be withdrawn for the treatment of immediate family members, including parents, spouses, children, and siblings, as well as for other urgent necessities.

The decision applies to the five banks that are merging to form Sammilito Islami Bank PLC: First Security Islami, Social Islami, Union, Global Islami, and EXIM.

According to Bangladesh Bank officials, the revision was made after depositors sought access to their savings for emergencies beyond medical treatment, such as family healthcare or other pressing financial needs.

A senior official of the central bank said that its board also decided to suspend the haircut system on depositors' profits, and that depositors will receive their profits as per Shariah law.

He also said that the merging process is likely to be completed by September this year, and that the administrator teams of the five banks will be withdrawn soon.

The five banks collapsed after years of large-scale irregular lending under the control of business groups linked to the previous Awami League government.

To protect depositors, the interim government merged the banks last year and introduced a phased repayment scheme.

The merged bank has a paid-up capital of Tk 35,000 crore, including Tk 20,000 crore provided by the government. Depositors will receive shares against the remaining Tk 15,000 crore.

In addition, the Deposit Insurance Fund is paying up to Tk 2 lakh per depositor, while the central bank is gradually repaying the remaining deposits through a separate scheme.

Officials of the central bank said that, so far, Tk 3,887 crore has been repaid to more than 822,000 depositors under the scheme.

As of December last year, the five banks had outstanding loans of Tk 195,000 crore, of which only Tk 47,900 crore, or 24.56 percent, was backed by collateral.

Their non-performing loans stood at Tk 170,500 crore, accounting for 87.43 percent of total loans.