The Bank Resolution Ordinance introduced during the interim government has been passed in Parliament as a bill, with the inclusion of a new clause that could allow former shareholders of merged weak banks to regain ownership.
Clause 18(a) of the newly passed law states that, notwithstanding any existing legal provisions, shareholders prior to a bank’s listing under the Bank Resolution Ordinance 2025—or any individual deemed suitable by Bangladesh Bank—may apply to the central bank, acting as the resolution authority, to re-acquire shares, assets, and liabilities of the concerned bank.
However, applicants must submit a formal undertaking outlining several commitments. These include expressing willingness to repay all financial support previously provided by the government or Bangladesh Bank, both before and after the bank’s inclusion in the resolution process.
Applicants must also restore the bank’s financial strength by injecting fresh capital and covering any capital shortfall identified by Bangladesh Bank. In addition, they are required to fully repay all loans, interest, profits, equity obligations, guarantees, and any other financial assistance received from government or quasi-government institutions.
The conditions further mandate the proper settlement of all legitimate claims and liabilities of depositors, as well as domestic and foreign creditors and third parties prior to the merger. All outstanding taxes, non-tax revenues, and other government dues must also be cleared in full.
According to sub-section (3) of the clause, within three months of receiving final approval, applicants must provide a pay order equivalent to 7.5 percent of the total funds injected by the government or Bangladesh Bank before regaining control of shares, assets, and liabilities.
Sub-section (4) stipulates that the remaining 92.5 percent of government or central bank support must be repaid within two years, along with simple interest at a rate of 10 percent.
The bill largely retains the core framework of the earlier ordinance. It includes provisions related to Bangladesh Bank’s authority as the resolution body, appointment of administrators, capital restructuring, transfer of assets and liabilities, formation of bridge banks, government financial assistance, resolution funds, winding-up procedures, and measures to identify and take action against responsible individuals.
BD Pratidin English/ Jisan
