Chairman of banks cannot serve as member of their subsidiaries: BB
The circular was issued to ensure better governance in the banking sector, according to the Bangladesh Bank
Chairman of any scheduled bank cannot serve as director or member of any subsidiaries, funded by the same bank or its owner, the central bank has said in a circular.
The circular, issued on Wednesday, also mentioned that the same directive is applicable for chairman of any bank's executive committee, audit committee and risk management committee.
The circular, forwarded to managing directors and chief executives of all scheduled banks on Wednesday, was issued to ensure better governance in the banking sector, according to the Bangladesh Bank.
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The central bank circular further states that if any sitting chairman of banks is currently serving at any subsidiaries, the post must be vacated by 30 June and the central bank be informed within seven working days.
The circular also said that any shareholder director, nominated director or independent director, who has served for a duration of more than one year cannot be recruited to the same bank. If any director is currently employed at present, the most must be vacated by 31 July and the central bank be informed within the following seven working days.
The central bank issued the circular under section 45 of the Bank Company Act, 1991.
