High Court Orders Freeze on S Alam’s Shares in Islami Bank

Photo: Collected

News Desk: The High Court has ordered the freezing of shares held by 24 companies allegedly linked to the S Alam Group for three months, following allegations that the group illegally acquired and exercised exclusive control over 81.92% of Islami Bank’s shares through those entities.

At the same time, the court issued a rule asking why the inaction of Bangladesh Bank in preventing the concentration of ownership of Islami Bank’s shares through the 24 companies, in violation of Sections 14A and 14B of the Bank Company Act, 1991, should not be declared illegal.

The High Court bench comprising Justice K. M. Kamrul Kader and Justice Md. Lutfur Rahman issued the rule and order on August 30, following a hearing on a writ petition.

The rule also asks why necessary steps should not be taken to confiscate the excess shares under Section 14A(3) of the Bank Company Act.

The writ petition was filed by the Islamic Economic Research Bureau (IERB), one of the founding shareholders of Islami Bank Bangladesh.

The petitioner’s lawyer, Mohammad Shishir Monir, confirmed the information on Friday (September 4).

He said that under the Bank Company Act, no single family or group is permitted to hold more than 10% of a bank’s shares.

The writ petition stated that 24 companies associated with the S Alam Group have been exercising exclusive control over 81.92% of the total shares of Islami Bank as institutional shareholders.

The petitioner said that the law contains a clear provision allowing Bangladesh Bank to confiscate shares held beyond the legally prescribed limit.

He further said that as part of the interim order, the High Court has directed that the 81.92% shares held in the names of the 24 companies be frozen for three months.