BRPD Circular Letter No. 33: Appointment of Independent Directors of a Bank-Company and their Duties, Responsibilities and Honorarium

Bangladesh Bank Head Office Motijheel, Dhaka-1000 Banking Regulation and Policy Department Ref No.: BRPD Circular Letter No. 33

To: Chairman, Board of Directors and Managing Director or Chief Executive Officer All Scheduled Banks operating in Bangladesh.

Dear Sir,

Regarding the appointment of 'Independent Directors' in Bank-Companies and their duties, responsibilities, and honorarium.

Reference is invited to BRPD Circular No. 03, dated 14 February 2024, on the subject cited above.

2. Through BRPD Circular No. 03/2024, guidelines were provided to banks regarding the policy to be followed for the appointment of independent directors of bank-companies and the determination of their duties, responsibilities, and powers. Now, paragraphs 4(g) and 4(h) regarding the experience and suitability for the appointment of 'Independent Directors' in bank-companies in the said circular are replaced as follows:

"04(g) He/She must hold a Bachelor's or Master's degree in Banking, Finance, Business Administration, Law, or Accounting from a recognized university. However, in the case of appointing a former Managing Director/Chief Executive Officer of any bank-company or a Chartered Accountant or Cost and Management Accountant engaged in the accounting profession as an Independent Director, he/she will be considered if he/she holds a Bachelor's or Master's degree in any subject.

(h) Experienced teachers in the Faculty of Business Studies or Business Administration, Law, and Information Technology of government, non-government, or autonomous universities, persons engaged in the legal profession, experienced bankers, and experienced officers of the Financial Institutions Department of the Ministry of Commerce, Ministry of Finance, Ministry of Industries, and Ministry of Law will be given priority consideration. In the case of appointing an Independent Director for a new Digital Bank, academic/professional education in Information Technology will be considered as an additional qualification."

3. Except for the aforementioned guidelines, all other guidelines contained in BRPD Circular No. 03, dated 14 February 2024, will remain unchanged.

4. These guidelines are issued under the powers conferred by Section 15(9) of the Bank Companies Act, 1991, and will take immediate effect.

Yours faithfully,

(Md. Harun-Or-Rashid) Director (BRPD) Phone: 9530155

18 Shrawan 1431 Date: ------------------- 18 July 2024