Dhaka, Sep 16 (V7N) – The Finance Ministry has approved the merger of five Sharia-based banks—Exim, Social Islami, First Security Islami, Union, and Global Islami Banks—in a move to stabilize the troubled Islamic banking sector.

Under the Bank Resolution Ordinance, the central bank will appoint a temporary administrator for each bank, assisted by four officials. Once the administrator assumes control, the existing boards of directors and managing directors will be dissolved.

A new bank license will be issued before the merger, with the proposed name ‘United Islami Bank’. The government will establish the bank with its capital, and the assets and liabilities of the five banks will be transferred to it.

The merger comes after widespread loan defaults ranging from 48 to 98 percent, attributed to alleged fraudulent activities during the previous government led by Sheikh Hasina.

The government is providing Tk 20,200 crore of the total Tk 35,200 crore required for the merger. The funds are expected to be recovered through the sale of shares, with major depositors invited to buy shares, while small depositors will continue to have full access to their funds.

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