Yunus Centre refutes Grameen Bank allegations centring Packages Corporation

The Yunus Centre has issued a detailed rejoinder in response to fresh allegations made by Grameen Bank's current management against its founder and Nobel Laureate Professor Muhammad Yunus.

The fresh attack accused Professor Yunus of financial improprieties during his tenure as Managing Director of Grameen Bank in the 1990s, specifically in dealings between GB and Packages Corporation, a renowned printing press in Dhaka owned by the Yunus family at the time.

Yunus Centre, a think tank dedicated to the flourishing of Prof Yunus's ideas on fighting and eradicating poverty, circulated a point-by-point rebuttal of each of Grameen Bank's allegations. 

Yunus family profiting from loan for Packages

One of the primary allegations is that Packages Corporation Limited, a business entity owned by Prof. Yunus and his family, received a loan of Tk9.5 crore from Grameen Bank without adhering to the bank's regulations.

The Yunus Centre clarifies that the owners of Packages Corporation, including Professor Yunus and his family, did not intend to benefit financially from the agreement with Grameen Bank. The bilateral agreement explicitly stated that the owners would not receive any financial benefits, such as profit shares, rent, or fees.

The objective was to reduce Grameen Bank's printing costs and ensure timely delivery of quality printing materials. The agreement provided Grameen Bank with access to the printing plant free of charge, which was crucial during the bank's rapid expansion.

"Owners just literally handed over the printing plant to Grameen Bank free of cost," Yunus Centre said.

"A new phase of Packages Corporation began when it was no longer under any control of the owners, nothing flowed to the owners. It entered a new phase, where the owners totally distanced themselves from all affairs of the Packages, including financial affairs."

Benefiting from print orders

Another allegation claims that Professor Yunus and his family financially benefited from awarding printing orders worth billions of taka to Packages Corporation at inflated prices.

The rejoinder firmly denies this claim, reiterating that the agreement precluded any financial benefits to the owners from transactions between Packages Corporation and Grameen Bank. The Price Fixing Committee of Grameen Bank ensured that prices were always lower than market rates, thus preventing any undue financial gains.

Misuse of GB loan facility

It was also alleged that Professor Yunus violated the Grameen Bank Ordinance 1983 by providing loans to Packages Corporation, which should have been limited to landless poor borrowers.

The Centre responds that the loans received by Packages Corporation came from the Social Business Venture Capital Fund (SVCF), a donor-funded initiative to support social businesses. Under the agreement, any profit made by Packages Corporation would not benefit the owners. The arrangement ensured compliance with the law, and the loans did not reach the owners.

Loan waivers for Packages

Grameen Bank accused Professor Yunus of waiving significant sums in unpaid loans to Packages Corporation, thus benefiting himself and his family when they failed to repay them.

The rejoinder states that the owners were not involved in the financial affairs of Packages Corporation. No loans from Grameen Bank were given to or reached the owners, making the question of waiver irrelevant. The amount in question, Tk7,22,000, was negligible, and not indicative of misuse of power.

Unauthorised appointments, use of GB office

Finally, it was alleged that Professor Yunus entered into a managing agent agreement with Packages Corporation without informing the board of directors and appointed bank employees to the corporation, besides using GB office space free of charge to conduct the activities of Packages Corporation.

Yunus Centre asserts that the agreement with Packages was authorised by Grameen Bank and discussed in multiple board meetings, receiving full support. The use of Grameen Bank employees and resources was necessary to manage the large-scale operation of printing and supplying materials during the bank's expansion.

In conclusion, the Yunus Centre reiterated that all the allegations against Professor Yunus and his family are baseless and unfounded.