Bangladesh forms panel to probe Grameen Bank

Last Updated: Wednesday, May 16, 2012 - 23:46

Dhaka: Bangladesh on Wednesday set up a commission to review the operations of pioneering microlender Grameen Bank and 54 related entities, a year after its founder Nobel Laureate Muhammad Yunus resigned after a protracted dispute with the government.

"The commission will identify the institutional strength, weakness and constraints of the Grameen Bank...It will recommend measures for ensuring good governance in the Bank, especially with a focus on accountability of management and transparency of operations," a government notification said.

The finance ministry notification said the four-member commission would review the entire operation of Grameen Bank and 54 social businesses linked to the pioneering microlender and look into the "purposes, legal status and operations" of Grameen Bank founded nearly three decades ago."

Finance Minister A M A Muhith recently said the reconstituted governing board of the Grameen Bank did not authorise most of the affiliates or businesses.

"The commission will review and recommend the regulatory institution and mechanism of Grameen Bank as to how to bring the bank under the purview of state regulatory agencies," it said.

The development came a week after US Secretary of State Hillary Clinton during her two-day Dhaka visit said the US government would not endorse any government action to undermine the achievements of Grameen Bank, which too won the Nobel Peace Prize in 2006 along with its founder for successes in fighting poverty.

"I can only hope that nothing is done that in any way undermines the success of what Grameen Bank has accomplished on behalf of many millions of poor women," Clinton had said.

But in a surprise move In February this year, Prime Minister Sheikh Hasina proposed Yunus`s nomination as World Bank president months after his resignation from the Grameen Bank after a protracted dispute with her government.

Yunus`s experiment of poor men`s banking earned
Bangladesh the repute of being the home micro credit.

The government earlier ditched possibilities of Yunus` appointment as the nearly ceremonial chairman of Grameen Bank as Hasina harshly criticised the high interest rate charged by Grameen Bank calling it a "blood sucker" of the poor.

Bangladesh`s central bank fired Yunus, 71, in March last year saying he had exceeded the mandatory retirement age of 60 while he resigned months later after losing a legal battle at the apex court.

The central bank, which is nominally independent from the government, fired Yunus on March 2 last year saying his 2000 appointment as the Grameen Bank’s executive chief was faulty also because the central bank’s mandatory approval was not obtained at that time.

Analysts, however, said the central bank decision was the outcome of the government reservation against him as Yunus’s troubles stem from 2007 when he announced formation of a political party.

The idea was not welcomed by Hasina and her archrival Khaleda Zia of Bangladesh Nationalist Party (BNP). He himself abandoned the idea of joining politics within months.

But Yunus` removal came as he apparently developed growing disputes with the?ruling Awami League in the preceding months after a Norwegian TV aired a documentary questioning the transaction of a Norwegian donor fund violating the agreement.

Despite a green chit issued by Norwegian government reliving him of the allegations, the government formed a five-member "review committee" to examine Grameen Bank transactions but his removal came ahead of the submission of the report by the investigators though the probe body too later cleared him off the allegations.

PTI



First Published: Wednesday, May 16, 2012 - 23:46

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