Finance ministry cold-shoulders move to cut govt's stake in GB

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Nazmul Ahsan
The Ministry of Finance (MoF) has rejected a move to restore some facilities granted under an ordinance that now stands lapsed.
The ordinance, promulgated during the last caretaker government, allowed the Grameen Bank (GB) to operate in the urban areas and reduced the government's share in the Bank from 25 per cent to 15 per cent. But the ordinance in question got lapsed since no bill to that effect was placed during the first session of the current parliament for consideration.
However, according to sources, the cabinet division has recently asked the MoF to examine the possibility of allowing the GB to operate in urban areas and reducing the share of the government from 25 per cent to 15 per cent and the number of its appointed directors from three to two.
The MoF conveyed its decision to the Cabinet Division last Sunday saying that restoration of the facilities granted under the now-lapsed ordinance was not possible.
"The case of GB has been rejected as the minister (finance minister) believes lots of banks in urban areas are now catering to the needs of the people belonging to various sections of the society," a top official in the MoF told the FE.
"Many private banks are now disbursing micro-credit in urban areas", he said.
As the government wants to play a proactive role in the affairs of the GB, issues of reducing its share and number of directors from the bank have not been considered, the official said further.
The Grameen Bank had started its journey in 1983 with a paid up capital of Tk 30 million, with the government owning 60 per cent of its shares. However, the government's share was later reduced to 25 per cent. Its paid up capital now stands at Tk 400 million, of which 25 per cent has been made available by the government.
As of November 2008, the GB had 7.64 million borrowers, 97 per cent of whom were women. With 2,535 branches across the country, the GB provides services to the rural people.