DFIM Circular Letter No. 18: Formation of Sub-Committee of the Board of Directors of Finance Company and their functions

Bangladesh Bank
(Central Bank of Bangladesh)
Head Office
Motijheel, Dhaka-1000
Bangladesh.
Ref No: DFIM Circular Letter No. 18
To:
Managing Director / Principal Executive Officer All Finance Companies operating in Bangladesh.

Dear Sir,

Regarding the formation of the Sub-Committee of Directors of Finance Companies and their functions.

2. Reference is drawn to your attention to DFIM Circular No. 01 issued on February 29, 2024, on the relevant subject.

3. Through the aforementioned circular, necessary instructions were provided regarding the formation of the Board of Directors of Finance Companies, the formation of the Executive Committee, Audit Committee, and Risk Management Committee comprising board members, and their responsibilities and other applicable matters. To ensure institutional governance, the Corporate Governance Program issued by the Bangladesh Securities and Exchange Commission (BSEC) - SEBI/CMRRCD/2018-163 (amended up to 2023) and subsequent instructions issued thereafter remain applicable to companies listed in the capital market. The aforementioned BSEC Corporate Governance Program mentions the formation of the Corporate Governance Implementation Sub-Committee (CGISC) and its functions. In the case of finance companies, the programs mentioned in the aforementioned BSEC Corporate Governance Program-2018 regarding the CGISC shall be carried out by the Audit Committee. In this regard, decisions taken by the Audit Committee must be approved (ratified) at the subsequent Board meeting. However, regarding the appointment/employment, duties, remuneration, applicable allowances, performance bonuses, and other facilities of Directors, Independent Directors, Managing Directors, or Principal Executive Officers and officers below them, the matter shall be conducted in accordance with DFIM Circular Letter No. 01, dated: February 29, 2024, DFIM Circular Letter No. 02, dated: March 13, 2024, DFIM Circular Letter No. 03, dated: March 25, 2024, and subsequent circulars/circular letters issued on this matter.

4. These instructions are issued under the powers granted by Section 41(2)(d) of the Finance Company Act, 2023.

Yours faithfully,

(Md. Asaduzzaman Khan)
Director (DFIM)
Phone: 9530178.
07 Jyestha 1431
Date:
21 May 2024
Deputy Director
Institution and Market Department