BRPD Circular Letter No. 23: Prohibiting presence of non-member at bank's Board Meetings and excess benefits to directors

Banking Regulation and Policy Department
Bangladesh Bank
Head Office
Dhaka.
BRPD Circular Letter No. 23 Dated 26 December 2013 Date: ------------------- 12 Poush, 1420

To,
The Chairman, Board of Directors / Chief Executive Officer All Registered Bank-Companies in Bangladesh.

Dear Sir,

Regarding the prohibition of the presence of non-members at the bank's Board Meetings and the provision of excessive benefits to directors.

It has recently been observed that in the Board Meetings of some banks, non-member persons, such as any outsider or shareholder, are attending and participating in the meetings. In this regard, it is mentioned that only the directors of the bank, along with the Managing Director and the Company Secretary, should be present at the bank's Board Meeting. Additionally, any officer of the bank may attend the meeting or a subsidiary committee of the Board upon summons from the Chairperson to present matters related to their jurisdiction (not for an extended period). Advice is being given to ensure that no outsider or shareholder is present at the Board Meeting or the subsidiary committee meetings under any circumstances.

Furthermore, it has come to light that some banks are providing additional financial benefits to their directors beyond the remuneration prescribed by rules. It is mentioned that Section 18(1) of the Bank Companies Act 1991 clearly states that no director of a bank-company shall accept any other financial benefit or facility other than the fixed fee determined for participating in the Board Meeting of the bank. You are also advised to ensure strict compliance with the provisions of the aforementioned section of the Bank Companies Act.

This circular must be presented at the next Board Meeting of the bank.

Yours faithfully,

(Saiful Islam)
Deputy General Manager
Phone: 9530155.