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The High Court has issued a rule and ordered the freezing of 81.92 percent of the shares of Islami Bank Bangladesh PLC allegedly held by S Alam-related entities through 24 companies.
Lawyer Mohammad Shishir Monir confirmed the matter on Friday, September 4. The order was passed on August 30 by a High Court bench comprising Justice KM Kamrul Kader and Justice Md Lutfar Rahman.
The writ petition was filed by the Islamic Economic Research Bureau (IERB), a sponsor shareholder of Islami Bank. Senior Advocate Mohammad Shishir Monir argued the petition, assisted by Advocate Mohammad Saddam Hossain.
According to the petition, a substantial portion of Islami Bank’s shares was concentrated among 24 entities in violation of Sections 14A and 14B of the Bank Companies Act, 1991. The entities allegedly hold a combined 81.92 percent of the bank’s shares.
Under the law, no individual, family or group is allowed to hold more than 10 percent of a bank’s shares. The petition alleged that S Alam-related entities circumvented the provision and acquired control of 81.92 percent of Islami Bank’s institutional shares.
The High Court issued a rule asking why Bangladesh Bank’s alleged inaction in seizing the excess shares should not be declared illegal. It also questioned why the central bank had failed to take steps to confiscate shares held beyond the legal limit under Section 14A(3) of the Bank Companies Act, 1991.
As an interim measure, the court ordered the shares held in the names of the 24 companies to remain frozen for three months.