2024-02-11 17:32:50
No more than 3 persons from a single family can be directors of the bank at the same time. At the same time, a single family cannot have representative director on behalf of more than 2 organizations or companies having interest or control.
On Sunday (February 11), the Banking Regulations and Policy Department of Bangladesh Bank has issued a circular regarding the constitution of the board of directors of bank companies and the responsibilities and duties of directors.
According to the constitution of the board of directors of bank-company, the number of directors of the board of directors will be maximum 20 people and independent directors will be three people. However, if there are less than 20 directors, individual directors cannot be more than two. At the same time, more than 3 members from a single family cannot be directors. And to be a member of the board of directors, the minimum age of the concerned person must be 30 years. And should have 10 years management or business or professional experience.
Bangladesh Bank has stated in the policy circular that this policy has been formulated to ensure good governance in the bank. At the same time, the board of directors of the bank must be constituted by suitable and professionally competent persons to complete the business activities properly and smoothly. The bank’s activities are mainly conducted with the money of the depositors. In this case it is essential to protect the interest of the depositors. For this reason, the responsibility of the board of directors of a bank-company is more important than that of other companies. More amendments have been brought in the Bank-Company Act in 2023 to ensure good governance in the banking sector. And as a result of this amendment, there has been a need to formulate new policies on various issues including the composition of the bank’s board of directors and the duties and responsibilities and qualifications of the directors. For the purpose of ensuring good governance in the banking sector, instructions have been issued to follow these principles in relation to the composition of the board of directors, the duties and responsibilities of directors.
The policy on the composition of the board of directors of the bank-company states that the board of directors of the bank-company will be composed of shareholder directors, representative directors on behalf of the shareholder organization and independent directors. Alternate Directors shall also be members of the Board of Directors where applicable; The number of directors of the board of directors shall be a maximum of 20 persons; If the number of directors in the board of directors is 20, the number of independent directors will be at least 3. If the number of directors of the board is less than 20, the number of independent directors shall be at least 2; No more than 3 members from a single family can hold the directorship of a bank-company at the same time.
The policy regarding the qualifications of the Board of Directors states that the person concerned should have at least 10 years of management or business or professional experience; No work experience shall be taken into account until a person attains the age of 18 years; The minimum age of the concerned person should be 30 years; He has not been convicted of a criminal offense or has been or is not involved in any forgery, financial crime or other criminal activity; No adverse observations/comments in court judgments in civil or criminal cases; Not in default for loans taken from any bank or financial institution in the name of himself or the organization concerned; Is not a tax defaulter either personally or for his personally owned firm or partnership firm; If he is employed in any position in the concerned bank-company, he can become a member of the board of directors if the employment does not exceed 5 years.
In the policy, various issues are mentioned including powers of directors, credit and risk management, internal control management, human resource management and development, financial management, appointment of managing directors, special instructions regarding individual directors, responsibilities of chairman and directors.