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Bangladesh Bank has reviewed the progress of loan recovery, reconstruction and overall operations of Sommilito Islami Bank PLC, with the bank filing nearly 10,000 lawsuits to recover non-performing loans and protect depositors’ interests.
Bangladesh Bank Governor Mostaqur Rahman chaired the review meeting with the Bank Resolution Department at the central bank headquarters on Thursday.
The meeting reviewed the bank’s merger and reconstruction process, restructuring of its board and management, human resource integration, branch rationalisation and IT system integration, all of which are being implemented under the central bank’s direct supervision.
Sommilito Islami Bank has filed nearly 10,000 cases as part of efforts to recover non-performing loans, while preparations are under way to file additional cases.
Alongside legal action, the bank has adopted compromise-based settlement mechanisms, including an Exit Policy and Alternative Dispute Resolution (ADR), to accelerate loan recovery.
A forensic audit is also nearing completion to identify those allegedly responsible for past irregularities, corruption, loan fraud and misuse of assets under the bank’s previous ownership and management.
According to Bangladesh Bank, several key measures have been implemented or monitored over the past six months.
The bank’s board of directors has been reconstituted with a majority of independent directors, while a new chief executive officer was appointed on July 16.
The organisational structures, roles and designations of around 16,000 officers and employees have also been aligned as part of the integration process.
IT integration is under way across the five constituent banks, covering the Core Banking System (CBS), SWIFT and RMA systems. A common interface will soon allow depositors to withdraw funds from any branch of the five banks.
The bank is also rationalising and integrating 780 branches and 1,500 business units based on factors including location, business potential, customer service and operating costs.
Sommilito Islami Bank was launched as the country’s largest state-owned Shariah-compliant bank, with a capital base of Tk 35,000 crore.
Bangladesh Bank said ensuring transparency, accountability and good governance in the management of the bank’s assets and deposits remains a key priority.
The central bank expects the consolidated measures to improve governance, operational efficiency and financial capacity while reducing administrative costs.
It also expects recovered funds to be redirected towards productive sectors of the economy.
