The much-anticipated bank merger process in Bangladesh is set to formally begin on Sunday, with Bangladesh Bank Governor Ahsan H Mansur scheduled to hold a series of meetings with the boards of five troubled banks.
They must either accept forced mergers or present a feasible turnaround roadmap, according to officials.
The meetings will be held daily until September 4, with each session focusing on one bank. Central bank officials confirmed that these sessions mark the first formal step in initiating the mergers.
According to Bangladesh Bank officials and bankers, the meetings will seek the banks’ formal views on the proposed mergers as well as their turnaround plans. Bangladesh Bank has instructed the banks to consult their respective boards before attending these meetings.
Bangladesh Bank spokesperson Arief Hossain Khan told Times of Bangladesh, “Starting today, we will meet separately with each bank’s board, reviewing their Asset Quality Review (AQR) reports. The central bank’s plans and expectations will also be shared.”
The five banks under the merger plan include EXIM Bank, Social Islami Bank (SIBL), First Security Islami Bank, Union Bank, and Global Islami Bank. According to the schedule, EXIM Bank will meet the governor today, followed by SIBL on Monday, First Security on Tuesday, Union Bank on Wednesday, and Global Islami Bank on Thursday. Bangladesh Bank has directed the banks to consult their respective boards before attending these upcoming meetings.
EXIM Bank holds out
Among the five, EXIM Bank has shown reluctance to merge. Instead, the bank’s board is preparing a survival roadmap to present at today’s meeting, arguing why it should be allowed to remain independent. A senior EXIM official said, “No bank’s owners want to merge with another. We will explain why EXIM should not be forced into a merger and submit a roadmap to meet the central bank’s conditions.”
Governor Mansur had previously told EXIM’s chairman, Md Nazrul Islam Swapan, that if the bank clears its obligations—including CRR, SLR, and Tk 8,000 crore borrowed from Bangladesh Bank—it may be spared from the merger.
Sources at EXIM Bank revealed that the bank’s financial condition has deteriorated further over the past two months.
SIBL board to decide on stance
Social Islami Bank’s (SIBL) Managing Director, Shafiuzzaman, told Times of Bangladesh that the bank’s position on the proposed merger will be finalized at its board meeting today. “We will attend Monday’s meeting with Bangladesh Bank based on the board’s decision, in line with the central bank’s guidance,” he said.
He added that SIBL has already submitted two restructuring plans to Bangladesh Bank—a two-year plan and an eight-year plan—aimed at turning the bank around.
A board member of SIBL, speaking on condition of anonymity, said, “There is no objection from the board regarding the merger. However, the sponsor shareholders are strongly opposed.”
Crisis after looting, foreign auditors step in
The central bank commissioned international audit firms to assess the health of these banks after widespread financial irregularities and looting following the fall of the previous government on August 5. The findings were alarming: heavy liquidity shortages, provisioning gaps, and severe erosion of asset quality. These AQR reports are now guiding the merger decisions.
A Union Bank board member admitted off-record, “This is essentially the first formal preparation for the merger, and Bangladesh Bank is taking us through the process step by step.”
A new era or a forced rescue?
Despite EXIM’s resistance, other bankers see the merger as inevitable. First Security Islami Bank Chairman Mohammad Abdul Mannan hailed it as “the dawn of a new era in Bangladesh’s financial sector.” He added, “If the merger succeeds, the crisis-ridden sector can turn into an opportunity. These banks still have significant assets—together they can stand strong again.”
Abdul Mannan, a former Islami Bank MD, also emphasized that the new entity would function more like an SME-focused bank, serving primarily middle- and lower-middle-class customers, and leaving little room for oligarchs.
