Business Report :
Sultan Mahmood Chowdhury, sponsor and former chairman of Social Islami Bank Limited (SIBL), has announced his intention to purchase 18.30 lakh shares of the bank to meet the minimum 2% shareholding requirement needed to qualify as a director.
In his announcement through the Dhaka Stock Exchange (DSE), Sultan Mahmood stated that he will purchase the bank’s shares on the public market at the prevailing market price by 31 October.
Earlier, in September, he purchased 18 lakh shares, bringing his total holdings in the bank to 1.8396%.
After completing the purchase of the declared shares, his holding will increase to 2%. According to the Bank Company Act, an individual must hold at least 2% of the bank’s shares to qualify as a director.
SIBL shares closed at Tk10.80 on Monday, which was 4.42% lower than the previous session at the DSE.
Earlier in August, the Bangladesh Bank dissolved the board of directors of the SIBL and formed a new five-member board. Sultan Mahmood was the chairman of the bank in 2010.
Since 2017, SIBL has been controlled by the S Alam Group, a business conglomerate with a history of alleged irregularities and corruption.
S Alam Group is alleged to have engaged in irregularities and corrupt practices within SIBL, particularly in the areas of recruitment and loan disbursement. Following the allegations, the central bank dissolved the SIBL’s board.
According to a confidential Bangladesh Bank report, SIBL concealed Tk7,936 crore in defaulted loans with the help of a central bank official.
As per the inspection report, By the end of December 2023, defaulted loans totaled Tk9,568 crore, but SIBL reported only Tk1,644 crore to the money market regulator.
The Bangladesh Bank initially concealed the true financial condition of SIBL. Later, the central bank reported that the bank’s total provisioning requirement was Tk1,370 crore, of which Tk1,306 crore had been covered, leaving a shortfall of Tk64 crore.
Its consolidated earnings per share stood at Tk0.53 at the end of the first half of this year. For the year 2023, the company paid a 5% cash dividend and a 5% stock dividend, with a consolidated net profit of Tk212 crore.