The Bank Company (Amendment) Bill 2023 was placed in Parliament on Thursday with the provision that not more than three directors of a bank can be from the same family.

Finance Minister AHM Mustafa Kamal placed the Bill and it was sent to the respective scrutiny committee for further examination. The Committee was asked to submit its report within 7 days.

Besides, the draft act also proposed strict measures in terms of borrowing by board members from banks as submission of collateral was made mandatory for them.

Currently there can be four directors from one family, but this has been proposed to reduce the number to maximum three.

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As per the proposed provisions, the banks must send the list of willful loan defaulters to Bangladesh Bank (BB) and it can impose a ban on overseas travel against them.

Stricter measures are also related to the issuance of their trade licence, and company registration under the Bangladesh Securities and Exchange Commission and the Registrar of Joint Stock Company and Firm.

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A willful defaulter cannot be eligible to be a director of a bank or financial institution until after five years have passed after being excluded from the list of willful loan defaulters.

If any director of a bank becomes a willful loan defaulter, Bangladesh Bank can declare his post vacant.

If a bank fails to send the list of loan defaulters to the central bank in time, the bank can be fined Tk50 lakh to Tk1 crore.

The bank will have to count fines of an additional Tk1 lakh for each day's delay.

According to the draft law, despite having the financial ability, if a person or institution fails to repay a loan, it will be considered willful default.

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About the definition of a willful defaulter it says "If anyone takes financial benefits from a bank or financial institution providing false information in their name or of their family members, the individual will be considered a willful defaulter."

At the same time, if someone states a specific purpose for taking a loan from a bank or financial institution, but uses the loan for other reasons, the recipient will be considered a willful defaulter.

A provision is also included here so that Bangladesh Bank can regularly inspect different institutions and foundations run under the law.

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