Operations to Begin in Early December
Bangladesh has officially launched its largest state-owned Islamic bank, the newly formed Combined Islamic Bank, created through the merger of five financially distressed Islamic banks. The Bangladesh Bank Board approved the final license on Sunday, clearing the way for the new entity’s formation. Dr. Mohammad Ayub Mia, a former senior secretary, has been appointed as the chairman.
According to the central bank, the new bank will begin full banking operations from the first week of December.
The five banks merged into the new entity are:
- First Security Islami Bank
- Global Islami Bank
- Social Islami Bank
- EXIM Bank
- Union Bank
Bangladesh Bank data shows that despite repeated liquidity support, the financial health of these banks continued to deteriorate. Their share prices dropped significantly in the capital market, and most of them reported negative net asset value (NAV). The merger decision was taken to stabilize the institutions and ensure better governance.
The new bank’s total paid-up capital has been set at Tk 35,000 crore, of which Tk 20,000 crore will be provided by the government and the remaining Tk 15,000 crore will come from depositors’ shares. The bank’s authorized capital has initially been fixed at Tk 40,000 crore.
Earlier, on November 9, the Ministry of Finance applied for the formation of the bank, after which the central bank granted preliminary approval.
