The High Court yesterday dismissed a writ petition challenging the government’s decision to consolidate five financially struggling private Islamic banks into a single institution.
The bench, comprising Justice Fahmida Quader and Justice Md Ashif Hasan, delivered the ruling following a brief hearing. Barrister Sayed Mahsib Hossain, representing the petitioner, confirmed the decision to the press.
Additional Attorney General Mohammad Arshadur Rouf appeared on behalf of Bangladesh Bank, opposing the petition.
The writ, filed on 18 November by general investor Shahidul Islam, named the governor of Bangladesh Bank, the finance secretary, and other senior officials as respondents. The petitioner sought directives aimed at safeguarding the interests of ordinary shareholders and ensuring proportional share allocation in the newly formed Sammilito Islami Bank, following the merger of the five banks.
The banks involved in the consolidation are as follows:
| Bank Name | Status Prior to Merger | Key Concern |
|---|---|---|
| First Security Islami Bank | Financially troubled | Capital inadequacy |
| Union Bank | Financially troubled | Liquidity challenges |
| Global Islami Bank | Financially troubled | Non-performing loans |
| Social Islami Bank | Financially troubled | Operational losses |
| EXIM Bank | Financially troubled | Regulatory compliance issues |
During proceedings, the state argued that the merger was executed under the Bank Resolution Ordinance 2025, which contains no provision for compensating shareholders. Accordingly, the petition lacked legal merit.
The writ had contended that shareholders’ rights were neglected and alleged that the merger had advanced despite the central bank’s inadequate preparedness for such a large-scale consolidation.
In administrative developments, Dr Mohammad Ayub Miah, former senior secretary, was appointed Chairman of Sammilito Islami Bank on 1 December. The merger had received preliminary approval from Bangladesh Bank on 9 November, following an application submitted by the Ministry of Finance.
Officials emphasised that the consolidation was intended to stabilise the financial system, protect depositors’ interests, and improve the governance and operational efficiency of the merged entity. Analysts note that such measures, though disruptive to shareholders in the short term, may strengthen the Islamic banking sector and restore public confidence in troubled institutions.
With the High Court’s decision, the government’s plan for consolidation now proceeds unimpeded, signalling a significant structural reform in Bangladesh’s private Islamic banking landscape.