Uncertainty looms over 76 lakh depositors of the newly formed Sammilito Islami Bank as Bangladesh Bank (BB) remains indecisive regarding the withdrawal of the controversial "haircut" decision on investment profits.
The Sammilito Islami Bank was recently formed through the merger of five Shariah-based lenders: Union Bank, First Security Islami Bank, Global Islami Bank, Social Islami Bank, and Exim Bank.
Central bank-appointed administrators currently managing these banks have repeatedly urged the regulator to scrap the profit-slashing measure. They argue that without restoring full profit rates, it will be impossible to regain depositor confidence, which is vital for the bank's turnaround.
The crisis has hit a vast number of individual depositors, including pensioners, who depend on these returns for their livelihoods.
Initially, the authorities announced zero profit for all shareholders and depositors for the years 2024 and 2025. Following intense criticism, a revised decision allowed a 4 percent profit for individual depositors, while institutional depositors remained excluded from any returns.
When contacted, a senior official of the relevant department at Bangladesh Bank told UNB on condition of anonymity that while discussions regarding the withdrawal of the "haircut" are ongoing, no final decision has been reached.
BB Executive Director and Spokesperson Arif Hossain Khan echoed this, stating that the policy remains unchanged for now.
Affected depositors have voiced strong opposition to the policy, which was initiated during the tenure of former Governor Dr. Ahsan H. Mansur.
"We do not accept this decision. We can wait for our principal amount, but we will not tolerate the slashing of our earned profits," said one depositor.
Industry insiders and officials from Exim Bank believe the institution could stabilize within three to four months if the "haircut" is revoked. They warned that the "trust deficit" created by this measure remains the single greatest obstacle to the bank’s recovery.
Meanwhile, Governor Mostaqur Rahman has instructed the administrators to expedite the merger process, including IT integration. During a recent meeting at his office, the Governor emphasized that there is "no scope for backtracking" from the merger.
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The Governor informed officials that the government has already provided Tk 20,000 crore in capital support to the new entity, while another Tk 12,000 crore is being disbursed to depositors through the Deposit Insurance Trust Fund.
Governor Rahman further directed the administrators to strengthen loan recovery efforts and take initiatives to restart any shut-down factories that were funded by the five merged banks. He also assured that a Managing Director for the unified Sammilito Islami Bank would be appointed shortly.