Central bank rejects appointment of Imdadul as Islamic Finance MD
The Bangladesh Bank has not cleared the appointment of Mohammad Imdadul Islam, currently managing director of GSP Finance, to the same post of another non-bank financial institution, Islamic Finance and Investment Limited, after it found irregularities in his service records.
In a letter to Islamic Finance on 20 April, the central bank suggested a search committee be set up by its board of directors to oversee the appointment of an MD and that a person with a "transparent image" be appointed after publishing advertisements in newspapers.
On 16 March, the central bank was requested to provide a no objection certificate for the appointment of Imdadul Islam.
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A senior official at the central bank said they found various inconsistencies in the different reports sent to the central bank by GSP Finance where Imdadul is currently the MD, and therefore the institution was also fined.
"Mohammad Imdadul Islam did not receive the clearance for his appointment as Islamic Finance's managing director as some irregularities came to the notice of the central bank," he told The Business Standard on condition of anonymity.
Earlier, the Bangladesh Bank also did not give its go-ahead to a proposed appoint of Chowdhury Manzoor Liaquat as the managing director of Islamic Finance and Investment.
A review of the overall situation shows that Islamic Finance disbursed a loan total of Tk12,036 crore at the end of June last year and loans in default amount to Tk45.54 crore or 3.68% of all outstanding loans. However, other indicators show the company is in a good position and there has been no shortage of capital and provisioning as of June last year.
Islamic Finance, which got listed on the capital market in 1986, has been giving dividends to its shareholders for more than 10 years.
It gave a 5% stock dividend last year even amid the pandemic, and its share price has been Tk8.80 at its lowest and Tk21.80 at its highest in the last one year.
By contrast, GSP Finance under the management of Imdadul Islam has Tk694 crore loaned out, of which Tk61.56 crore or close to 9% is in default.
