In a recent development, the Bangladesh Central Bank has imposed withdrawal restrictions on nine banks, including five operating under Shariah principles. This measure comes after a series of financial challenges faced by these banks, which have been reliant on liquidity support from the central bank since 2022.
As of August 12, the central bank announced that no cheques exceeding 1 crore Taka (approximately $1 million) issued by these banks will be honored unless presented at the bank that issued them. The affected banks are National Bank, Padma Bank, ICB Islamic Bank, Islami Bank Bangladesh, First Security Islami Bank, Social Islami Bank, Union Bank, Global Islami Bank, and Bangladesh Commerce Bank.
The move follows a significant banking crisis in 2022, triggered by allegations of these banks approving loans based on fictitious addresses. Since then, the banks have been propped up by the central bank’s liquidity support as a last resort. This decision to limit withdrawals was made shortly after the resignation of Governor Abdur Rouf Talukder and the exile of former Prime Minister Sheikh Hasina. Talukder had previously supported the struggling banks, including the Shariah-compliant ones, but the new administration has decided to withdraw this support.
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