Staff Reporter:
There is currently no scope to safeguard the interests of general investors or shareholders in the merger of the five troubled banks under the Bank Resolution Ordinance, 2025, according to a statement issued by the Bangladesh Bank.
However, the central bank noted that the government may consider compensating small investors and shareholders.
At a press conference on Wednesday, Bangladesh Bank Governor Ahsan H Mansur said shareholders of the five banks would not receive any shares in the new merged entity, as the asset value of their existing holdings is already negative.
His remarks triggered anger and frustration among investors and shareholders, with some even threatening protests.
In its statement, the central bank explained that the Bank Resolution Ordinance, 2025, was enacted following international best practices and with technical support and recommendations from the International Monetary Fund (IMF), the World Bank, and the Foreign, Commonwealth and Development Office (FCDO).
The ordinance clearly outlines the rights of depositors, shareholders, and other creditors in banks brought under resolution, it said.
The statement further mentioned that after the resolution process concludes, any compensation found payable to shareholders — based on an assessment by an independent professional valuer appointed by the Bangladesh Bank — may be provided.
However, analyses from the Asset Quality Review (AQR) and special inspections by an international consulting firm revealed that the five banks have suffered significant losses and now have a negative net asset value.
At a recent meeting of the Banking Sector Crisis Management Committee (BCMC) — formed under Section 42 of the ordinance — it was decided that “the shareholders of the five distressed banks shall bear the losses of the banks under the resolution process.”
Based on these findings and the BCMC’s decision, the Bangladesh Bank concluded that there is no scope to protect the interests of shareholders or general investors in the ongoing merger of the five troubled banks.
