Staff Reporter :
The Bangladesh Bank (BB) has served a notice on Farmers Bank authorities to explain why its Managing Director AKM Shamim should not be removed from his position within December 2.
In the notice sent on Sunday, it BB said Shamim failed to manage liquidity in the bank and maintain cash reserve ratio (CRR) and statutory liquidity ratio (SLR) in line with BB regulations. The central bank also said that he failed to act as per BB’s instruction while disbursing fresh loans and take actions after a host of financial irregularities involving over Tk 400 crore detected by the BB at Farmers Bank between 2014 and 2016.
Shamim joined the bank in May 2013.
A BB senior management headed by its Governor Dr Fazle Kabir decided to serve Shamim the notice under clause 46 of the Bank Company Act, which gives the central bank the authority to remove an MD if his/her activities prove harmful to depositors.
The act also dictates that in such case the central bank must give the MD a reasonable time for self-defence.
Earlier, a BB investigation has indicated that Shamim had failed to carry out his responsibilities to safeguard the interest of the private bank’s depositors.
The BB investigators found 12 counts of irregularities by Farmers Bank in giving out loans, which include no verification of customer’s creditworthiness, absence of KYC procedures, and extending loans to defaulters.
Majority of the anomalies were detected in the bank’s Gulshan, Motijheel and Shaympur branches in Dhaka and Khatunganj branch in Chittagong.
Despite several attempt, Shamim could not be contacted for his comments on the matter.
Concerned BB officials also declined to comment on the issue.
