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Money laundering, loan scams blamed

Top level changes in AB Bank on card

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Special Correspondent :
AB (Arab Bangladesh) Bank will taste a major change in its board of directors and the top management soon in a move to improve the financial health of the first generation private bank.
The bank has already stopped all lending activities following a sharp deterioration in its key financial indicators.
It has mired itself   through money laundering and loan scams, damaging its reputation.
Sources said that the organisational change would be done by replacing its chairman and managing director. Changes will also be brought the bank's executive committee, audit committee, risk management committee and management committees as part of its major management shake up.
An unanimous bank official told The New Nation yesterday that former   Bangladesh Bank (BB) Deputy Governor Rumee Ali would be made new chairman of the bank, while Mamdurur Rashid, who is now serving as the additional managing director in the United Commercial Bank Limited (UCBL), would join as new managing director.
MA Awal is now serving as the Chairman and Tarique Afzal President and Managing Director (CC) of the bank.
In December 2017, MA Awal was made new chairman of the bank after predecessor M Wahidul Haque resigned amid money-laundering charge against him.
In October last year, the bank's managing director Moshiur Rahman Chowdhury stepped down from his post as he failed to rescue the ailing bank, which was found in the "red zone" in the central bank's Bank Heath Index.
 "The authority of AB Bank has decided to bring a rapid overhaul in the bank's internal governance in the wake of its declining financial indicators," a senior AB Bank official told The New Nation yesterday on condition of anonymity.  
"A major shake up in the bank's board of directors and management is on the cards to prevent the bank from further vulnerability," he added.
In May 2017, Bangladesh Bank posted an observer to the AB Bank to oversee the activities of the bank and improve financial health. But no noticeable improvement is in sight.
AB Bank's default loans stood at Tk 1,664 crore as of December 2018, which was Tk 967 crore as on December 2017.
In October 2017, a central bank inspection found that the bank had laundered about Tk 165 crore to the UAE through two shady organisations in the name of investment.
On January 25 last year, the Anti-Corruption Commission (ACC) arrested former AB Bank Chairman M Wahidul Haque for allegedly laundering around Tk165 crore outside the country.
The national anti-graft agency also arrested former AB Bank official Abu Hena Mostafa Kamal and businessman Saiful Haque, a client of the bank, on the same charges.
The others accused in the case are former managing directors of the bank Md Fazlur Rahman and Shamim Ahmed Chowdhury, Head of Offshore Banking Unit or OBU Mohammad Lokman, Head of Corporate and Structured Finance Division Mahfuz-Ul-Islam and Senior Vice-President Md Nurul Azim.
BNP leader and former foreign minister M Morshed Khan was the founding chairman of the AB Bank.  He holds 25 per cent shares of the bank.
The Bank is now running with an eight-member board of directors comprising Feroz Ahmed, Syed Afzal Hasan Uddin, Shishir Ranjan Bose, FCA, Syed Golam Kibria, Asish Baran Sarkar, Moshtaque Ahmed Chowdhury, Shajir Ahmed and Khairul Alam Choudhury, shows the bank's web page.

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