|ICB buys Oriental|
|Friday, 29 February 2008|
Switzerland-incorporated ICB Financial Group Holdings has purchased the problem-ridden Oriental Bank, officials said Thursday.
ICB has bought a 50.10 percent stake in the bank for Tk 350.67 crore and renamed it ICB Islamic Bank Limited. ICB takes over management of the bank 15 days from now.
A tripartite agreement was signed at Bangladesh Bank in Motijheel Thursday morning. The proposed chairman of ICB Islamic Bank Ltd Dr Hadenan bin Abdul Jalil signed the agreement on behalf of ICB while Bangladesh Bank's acting general manager Jahangir Alam and Oriental Bank chairman AH Toufique Ahmed signed on behalf of their organisations. ICB, incorporated in Switzerland, is the holding company for several banks operating in Eastern Europe, Africa and Asia.
The Group made its foray into Asia in 2003 by acquiring an indirect stake of 11.3 percent in Bank Internasional Indonesia, one of the largest banks in Indonesia, according to the company's website. ICB was listed on AIM (alternative investments market) of the London Stock Exchange in May 2007.
After the signing of the agreement, Dr Hadenan told reporters that his first job after takeover would be to increase the efficiency of the bank. He said necessary steps would be taken to bring back transparency to the bank, and that all banking activities would be conducted abiding by the rules and regulations of Bangladesh Bank.
The would-be chairman said that no officers or employees of the bank would be retrenched. The bank will be overhauled with the appointment of new officials and employees, he said. A plan is underway to increase the number of branches to 50 from the existing 30, Hadenan added.
Bangladesh Bank deputy governor Murshid Kuli Khan who was present at the ceremony said that being able to sell the troubled bank in such a short time was a great success for the central bank. Of the 49.90 percent shares that remain of the bank, ownership of about Tk 300 crore would be given to general shareholders. Depositors will also get a chunk of general shares proportionate to their deposits, according to a scheme.
The bank has about Tk 1,400 crore deposit liabilities . Bangladesh Bank in a formal letter on Feb 14 gave permission to ICB, the highest bidder, to buy a 50.10 percent Oriental stake. A tender was initially invited for the crisis-ridden Oriental on Feb 4, 2007. Six firms showed interest in buying the bank.
Only ICB and Domestic Investors Consortium Bangladesh submitted tender bids. Bangladesh Bank acquired Oriental Bank on June 19, 2006, following charges of financial irregularities. An official of the central bank was appointed administrator of the bank.
On Aug 6, 2006, the central bank removed Oriental Bank's managing director and suspended the activities of the bank's management council. The central bank, with the government's approval for reconstruction of the bank, increased the approved and paid-up capital of the bank.
The EC will hold talks Thursday with two other parties Islami Oikkyojote and Liberal Democratic Party. The EC began the second round of electoral reforms dialogues with political parties on Feb 24.
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