After FSIB, Union Bank accepts merger, EXIM declines

Two banks have so far said they are willing to accept the mergers and acquisitions (M&A) bailout but EXIM Bank disagrees to espouse such a sink-or-swim revival recipe launched by the regulator for banking-sector overhaul.

The crisis-ridden First Security Islami Bank (FSIB) accepted Tuesday the merger option rolled out by the central bank, while Union Bank agreed to the revival plan on Wednesday, officials said.

Instead of welcoming the M&A move, the Export Import (EXIM) Bank of Bangladesh presented a turnaround roadmap in a meeting with Bangladesh Bank Governor Dr Ahsan H. Mansur and his deputies at the BB headquarters on Wednesday.

The central bank governor joined the meeting virtually with the bank's board-of-directors members.

Emerging from the meeting, EXIM Bank Chairman Md. Nazrul Islam Swapan said they made a presentation over how the lender will bounce back from the present situation, with intensified focus given on issues like recovery, capital injections and rebalancing investment portfolios.

But the central bank's high-ups instructed the bank to make some revision to the rebound roadmap before presenting in the next meeting with the BB top executives,

"We'll do the same and place it in the next meeting," said Mr Swapan, who took the charge of the bank's board after the dissolution of its previous board by the banking regulator as part of its banking-sector reform recipes undertaken after the governance changeover through last year's uprising.

However, the schedule of the meeting has not been fixed.

Seeking anonymity, an executive of the bank said the board of the bank had earlier decided not to accept the BB-dispensed M&A cure as it believes that the bank will be able to come out of the distress situation in the near future.

"This is the message the bank shared today with the central bank," he told The Financial Express.

Earlier in the day, board of members of Union Bank also sat for another meeting where they had accepted the central bank's M&A initiative.

Talking to reporters, Union Bank's chairman, Md. Fariduddin Ahmed, said the depositors come to get their money back but the lender is unable to pay back.

"So, it would be good for the industry as quickly as we take decisions like mergers and acquisitions regarding such liquidity-crisis banks," he said.

Giving an example, the bank's chairman said the controversial S. Alam Group had taken away assets amounting to Tk 280 million under various names, whose trace has not been found yet.

"So, we're not paying back the depositors' funds," he added about the exigency of accepting the desperate remedy for a desperate ailment.

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