Finance Minister AMA Muhith has said a policy for electing Directors to the Grameen Bank board will be soon be worked out.
Muhith said the government did not want to bring changes to the institution’s ownership or its management system.
“A policy on how to elect the Board of Directors must be framed for the Grameen Bank because there is none at the moment,” he said after a Planning Commission meeting on Wednesday.
Muhith hinted, the policy may be formed soon after the Eid-ul-Fitr.
He said the government’s 25 percent share holding at the institution will remain unchanged.
The Finance Minister said the government did not invest against its share as it caused some problems like its capital did not increase.
“But the Grammeen Bank is likely to face the problem more than the government,” he said.
Muhith rejected former Managing Director Muhammad Yunus’ allegations that the government was trying to ‘tear apart’ the Nobel winning institution.
“This is utterly nonsense,” he said replying to the allegations. “Mr Yunus has been repeating that the government wants to take over the Grammen Bank….. These are all lies.
He said 40 percent share of the bank was initially owned by the then government when it was established.” Later, its Charter was changed.”
Grameen Bank was founded in 1983 through a martial law ordinance. Its foundations were laid in 1977 and in six years it developed to the stage of being launched as a bank. Yunus and Grameen Bank were awarded the Nobel Peace Prize in 2006 “for their efforts towards poverty alleviation” through micro-credit.
After the National Norwegian Television in December 2010 had aired an investigative TV documentary “Fanget i Mikrogjeld” or “Caught in Micro debt”, allegations were there that Yunus drew off nearly Tk 7 billion (100 million dollars) in aid for poor borrowers of Grameen Bank to another of his company back in 1996. This sparked a widespread discussion both at home and abroad.
In the wake of such allegations, the government formed a commission to review the activities of Grameen Bank and 48 other organisations that bear the Grameen name, and make recommendations on how to run the organisations.
Recently the commission in its report recommended creation of several independently registered organisations under Grameen Bank in order to ‘decentralise drastically’ the bank’s operations and management, media reports say.
Bangladesh Bank on March 2, 2011 relieved Yunus of his duties stating ‘it is not valid for Prof Yunus to continue holding office’. Yunus moved to the High Court against the central bank decision but lost the legal battle.
Currently, the bank has 12 Directors. The Chairman and three of the directors have been appointed by the incumbent Awami League government. – bdnews24.com
Bangladesh takes aim at GB: NYT
The government of Bangladesh is considering nationalizing and breaking up the widely admired Grameen Bank, which pioneered the business of lending small amounts of money to poor women who want to start and grow businesses. Lawmakers should reject these destructive ideas and stop meddling in the affairs of this important financial institution, which serves 8.4 million rural women.
In the last two years, the government of Prime Minister Sheikh Hasina has waged a destructive campaign against Grameen and its founder, Muhammad Yunus, who won the Nobel Peace Prize in 2006. Her actions appear to be retaliation for Mr. Yunus’s announcement in 2007 that he would seek public office, even though he never went through with his plans.
In 2011, her aides forced Mr. Yunus out of his job as managing director of the bank by arguing that he was older than a mandatory retirement age of 60, even though bank regulators had previously allowed him to stay in the job after he crossed that threshold. Since then, the government has started an investigation into the bank and is now planning to take over Grameen — a majority of whose shares are owned by its borrowers — and break it up into 19 regional lenders.
Although the microcredit model created by Mr. Yunus in the 1970s has lost some of its luster in recent years because of controversial practices by some lenders other than Grameen, the approach remains a vital tool for reducing poverty. It has helped millions of poor women start and sustain small businesses around the world and especially in Bangladesh, according to the World Bank.
Turning Grameen into an arm of the state would jeopardize the bank’s core mission by subjecting it to destabilizing political interference. And breaking it up would make its operations less efficient while eliminating it as an influential national organization that might challenge government policies.
A government-appointed commission studying Grameen Bank is expected to produce a report next week that recommends three different proposals, one of which would nationalize and break up the bank, according to local news reports. Some political analysts say that Prime Minister Hasina might not act on those recommendations until after the country votes for a new government at the end of the year to avoid giving the bank’s many borrowers and employees a reason to campaign and vote against her.
Regardless of when the prime minister makes her decision, she has provided no compelling reason to dismantle one of the most promising credit movements to have benefited millions of women in her country. – Editorial published in The New York Times
