The Appellate Division of the Supreme Court on Tuesday temporarily cleared the way for holding United Commercial Bank鈥檚 42nd annual general meeting to be held on Thursday, staying a High Court order that had earlier halted the event for three months.
Chamber judge Justice Farah Mahbub granted the two-week stay following a petition by UCB鈥檚 chairman Sharif Zahir challenging the High Court鈥檚 order.
The judge also directed Zahir to file a regular leave-to-appeal petition and set August 4 for a full bench hearing, UCB lawyer Anisul Hassan told 抖阴精品.
The High Court鈥檚 Company Bench on July 27 had stayed the AGM for three months after admitting a petition from six general shareholders, including MA Sabur. They challenged the legality of holding the AGM without proper representation of general shareholders on the board.
The shareholders alleged that the AGM agenda, which includes a major rights share issue, would disproportionately benefit a select group of insiders and further dilute general shareholder influence.
They argued that the current interim board 鈥� formed following the fall of the Awami League-led government on August 5, 2024 鈥� lacked the mandate to make such significant decisions.
鈥楾he board intends to issue 50 per cent of new shares to an unnamed 鈥榮trategic investor鈥�, but has not clarified who this investor is or how they were selected,鈥� senior counsels Zainul Abedin and AM Mahbub Uddin Khokon told the chamber judge.
They argued that the interim board was acting in bad trust and that its decisions were in conflict with shareholder interests and corporate governance standards. 鈥楾his board has no legitimacy to conduct an AGM or approve capital restructuring that impact all shareholders,鈥� they said.
On the other hand, UCB鈥檚 counsel, senior lawyers Nihad Kabir and Ruhul Quddus Kazal, argued that delaying the AGM would harm the bank鈥檚 financial stability.
Nihad said the rights issue was essential to meet capital adequacy requirements under the Basel III framework and that the AGM must go ahead for shareholder approval of the recapitalisation plan.
鈥楾he rights issue is a time-sensitive measure to bridge the capital shortfall and strengthen Tier I capital. Any delay will jeopardise the bank鈥檚 compliance status and the interests of depositors,鈥� she contended.
She further contended that the High Court erred in failing to consider the urgency and regulatory necessity behind the AGM agenda, which includes the approval of rights shares discussed in the bank鈥檚 513th board meeting held on May 27.
