The Dhaka Stock Exchange on Thursday suspended the trading of shares of five Shariah-based banks following Bangladesh Bank鈥檚 decision to declare them non-viable and initiate a merger process.
The move has caused significant concern among investors who now face heavy losses.
According to Dhaka Stock Exchange officials, the trading suspension was made at the instruction of the Bangladesh Securities and Exchange Commission, as the central bank on November 5 placed the five banks鈥擣irst Security Islami Bank, Social Islami Bank, Global Islami Bank, Union Bank, and EXIM Bank鈥攗nder the Bank Resolution Ordinance 2025.
The suspension took effect from November 6 and will remain in place until further notice.
The process is expected to wipe out investors鈥� holdings completely.
At a face value of Tk 10 per share, investors stand to lose about Tk 5,815 crore, while the loss at market price is estimated at around Tk 1,330 crore.
A group of investors protested on Thursday against the move that will render their shares worthless, calling the losses unwarranted.
Also on Thursday, the Bangladesh Bank clarified that shareholders鈥攊ncluding both sponsors and general investors鈥攚ill receive nothing, as the banks鈥� net asset values have turned negative, with losses of up to Tk 450 for each Tk 10 share.
However, it stated that if the government wishes, it could compensate small investors for their losses.
On Wednesday, Bangladesh Bank dissolved the boards of the five banks and appointed administrators to each to oversee operations during the transition.
The administrators have already taken charge and begun working toward the planned merger.
The five banks will be consolidated into a single state-owned entity, tentatively named Sammilito Islamic Bank.
The new bank will initially be government-owned but may later be transferred to the private sector once a strategic partner is identified, likely within two years.
Governor Ahsan H Mansur said that the five institutions had been officially declared non-viable due to prolonged mismanagement, massive loan irregularities, and liquidity shortages.
Mansur outlined four immediate responsibilities for the administrators 鈥� keeping daily operations running smoothly, maintaining key financial activities such as remittance and letter of credit settlements, integrating the banks鈥� IT systems for centralized operations, and rationalizing human resources and branches to eliminate overlap.
He said the new entity would start with Tk 35,000 crore in paid-up capital, making it the largest and most capitalised bank in the country.
The new bank will be run professionally under government ownership but will operate like a private commercial bank.
The governor reassured depositors that their funds were safe, noting that depositors with up to Tk聽2聽lakh would be able to withdraw their full balances immediately, while larger depositors would receive their funds in phases.
He said the merger process would protect the deposits of more than 7.5 million customers.
Share price of EXIM Bank closed at Tk 3 per share, First Security Islami Bank at Tk 1.9, Social Islami Bank at Tk 3, Union Bank at Tk 1.5, and Global Islami Bank at Tk 1.7 on Wednesday.