Islami Bank to appoint 3 auditors to find out causes of irregularities

Islami Bank Bangladesh will appoint three external auditors to root out the causes of irregularities in its loan approvals, forex dealings and employee recruitment process over the past seven years.

The bank's new board of directors took this decision at their first official meeting yesterday.

Earlier on August 22, the Bangladesh Bank formed a new board for the Shariah-based bank with the appointment of five independent directors. Md Obayed Ullah Al Masud, former managing director of Rupali Bank, was announced as chairman of the board.

As a result, the largest private commercial bank in the country was freed from S Alam Group after seven years.

One of the directors told that the new board has decided to find out which borrowers are not repaying their loans from the bank and who were involved in approving those disbursals.

Earlier on August 22, the Bangladesh Bank formed a new board for the Shariah-based bank with the appointment of five independent directors

Between 2017 and June this year, S Alam Group and its associated companies borrowed Tk 74,900 crore, which was 47 percent of the lender's total outstanding loans as of March.

The loans were taken in the name of Mohammad Saiful Alam, his wife, daughter, other relatives and officials of the Chattogram-based conglomerate, according to central bank officials with knowledge on the matter.

Documents pieced together by show that most of the loans were taken by bypassing banking rules in a testament to how S Alam Group exerted its influence on the country's banking sector.

However, the board has yet to decide who will be appointed as the auditors, said the official of Islami Bank.

Also, the auditors will look into where the bank invested US dollars over the past several years, the official added.

The official informed that the bank's investment department, treasury department and human resource department will be included in the audit.

Islami Bank is the highest remittance earning bank in the country, according to industry people.

After taking charge of the bank's operations in 2017, S Alam Group appointed 7,240 employees by violating regulations, with most of them hailing from Alam's hometown in Patiya of Chattogram.