Ex-owners seek to reclaim SIBL

Five sponsor shareholders and former directors of Social Islami Bank PLC (SIBL) have applied to Bangladesh Bank to regain control of the Shariah-based lender, which was merged with four others into a single state-owned entity under the Bank Resolution Ordinance, 2025.

The application, submitted yesterday and seen by The Daily Star, cites section 18(ka) of the Bank Resolution Act, 2026, which allows former owners to reclaim merged banks.

Parliament passed the act by amending the ordinance just over two weeks ago, enabling former owners to regain control by paying 7.5 percent upfront of the government or Bangladesh Bank’s injected funds.

The remaining 92.5 percent is repayable within two years at 10 percent simple interest, according to the amended law.

The amendment has drawn sharp criticism. Critics say the new provisions will rehabilitate those who put the entire banking sector at risk with scams and bad loans.

The applicants are led by Maj (retd) Dr Md Rezaul Haque, former chairman and sponsor shareholder of SIBL.

Rezaul, who chaired SIBL’s board until October 30, 2017, was joined by sponsor shareholders Hakim Md Yousuf Harun Bhuiyan, MD and chief mutawalli of Hamdard Laboratories Waqf, and Sultan Mahmood Chowdhury.

The other applicants are former shareholder director Afia Begum and shareholder Md Zabedul Alam Chowdhury.

Contacted, Bangladesh Bank spokesperson and Executive Director Arief Hossain Khan said the application “might have been submitted, but has not yet reached the relevant department”.

The application argued that the merger initiative did not adequately consider the “distinct operational realities and financial condition of SIBL, particularly as the primary issue related to liquidity stress rather than fundamental insolvency”.

The applicants said SIBL’s governance was disrupted due to external influence between 2017 and 2024, when significant changes in control and management structure weakened the institutional foundation of the entity.

SIBL was under the control of the Chattogram-based business house S Alam Group, which allegedly took over the entity through coercion.

The applicants have proposed a strategic recovery roadmap and requested eight years, including a two-year grace period, to repay nearly Tk 11,000 crore owed to Bangladesh Bank at the bank rate.

SIBL was merged with First Security Islami Bank, Union Bank, Global Islami Bank, and EXIM Bank into Sommilito Islami Bank. The merged entity received its licence in December last year after the government and Bangladesh Bank injected Tk 35,000 crore in capital and provided additional liquidity support.