Regulatory Alerts2025-12-29
Added
BRD Circular Letter No. 01: Bank Resolution Scheme, 2025
The Bangladesh Bank establishes the Bank Resolution Scheme, 2025, to resolve five non-viable banks (Export Import Bank of Bangladesh PLC, First Security Islamic Bank PLC, Global Islamic Bank PLC, Social Islamic Bank PLC, and Union Bank PLC) by merging their assets and liabilities into a new state-owned entity, Combined Islamic Bank PLC. The scheme mandates a 100% haircut on Mudaraba sub-ordinated and perpetual bonds, converts permanent deposits into equity shares (Class A, B, and C), and imposes phased withdrawal restrictions on institutional and non-institutional depositors over periods ranging from immediate access for insured amounts to up to 24 months for excess funds. Additionally, it transfers all legal proceedings to the new bank, validates existing banking documents, and outlines the governance structure and employee transfer terms under the Bank Resolution Ordinance, 2025.