Bangladesh Bank orders pay cuts for Sammilito Islami Bank’s employees

Bangladesh Bank has ordered a reduction in the salaries of employees from the five banks that have been merged to form the new ‘Sammilito Islami Bank’ (Combined Islamic Bank).

Sammilito Islami Bank’s Assistant Spokesperson Shahriar Siddiqui on Thursday said, “The decision to cut the salaries of employees of the five banks included in the new Sammilito Islami Bank was taken while allocating Tk350 crore in liquidity support.”

He explained that the salaries of the banks’ employees depend on the depositors’ funds, citing an example, “Last year, First Security’s income was negative. Yet, they paid salaries amounting to Tk650 crore from depositors’ funds. Employees of FSIB and SIBL are currently able to withdraw only a portion of their salaries.”

The Governor has instructed the swift implementation of this measure due to the banks’ severe liquidity crisis and financial irregularities.

The spokesperson, however, clarified that this decision is part of the restructuring process and is temporary. Once the situation normalises, the officials will receive market-based salaries, he added.

Earlier, on November 5, Bangladesh Bank declared five financially troubled Shariah-based banks as ineffective and appointed administrators. The banks are: Exim Bank, Social Islami Bank, First Security Islami Bank, Union Bank and Global Islami Bank.

Later, on November 9, the central bank’s board, chaired by Governor Dr Ahsan H Mansur, granted a preliminary license during a special online meeting to the new Shariah-based state-owned bank, ‘Sammilito Islami Bank,’ to operate after merging the five weak banks.