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27/12/2023 The Banking-Company (Amendment) Act, 2023
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The Banking-Company (Amendment) Act, 2023

(Act No. 13 of 2023)
[ June 26, 2023 ]
An Act to further amend the Bank-Company Act, 1991
WHEREAS it is expedient and necessary to further amend the Bank-Company Act, 1991
(Act No. 14 of 1991) to meet the following objectives;
Therefore it is hereby enacted as follows:-
Short title 1. (1) This Act may be called the Bank-Company (Amendment) Act, 2023
and
introduction .
(2) It shall take effect immediately.
Amendment 2. Section 3 of the Bank-Company Act, 1991 (Act No. 14 of 1991),

of Section 3
hereinafter referred to as the said Act-
of Act No.
14 of 1991
(a) for sub-section (2) the following sub-section (2) shall be substituted,
namely:-
“(2) Nothing in this Act shall apply to any financial institution licensed
under the Financial Institutions Act, 1993 (Act No. 27 of 1993):
Provided that in the case of any financial institution licensed under the
said Act, the provisions of Clause (C) of Section 5, Sub-Section (6) of
Section 17, Sub-Section (7A), Section 27A, Section 27CC and Section
27B shall apply. .”; And
(b) sub-section (3) shall be repealed.
https://bdlaws-minlaw-gov-bd.translate.goog/act-print-1430.html?_x_tr_sl=bn&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=sc&_x_tr_sch=http 1/29
Amendment 3. Section 5 of the said Act-

of Section 5
of Act No. (a) after clause (kak), the following new clauses (kakak), (kakakak) and
14 of 1991
(kakakakak) shall be inserted, namely:-
“(cock) “financial report” or “statement” means a financial statement as
defined in sub-section (3) of section 2 of the Financial Reporting Act,

2015 (Act No. 16 of 2015);
(CCCC) “Willful Defaulting Borrower” means any such Defaulting

Borrower person, institution or company who or which—
(1) Loan, advance, investment or any other financial benefit or any part
thereof or interest or profit charged thereon from any bank-company or
financial institution in favor of himself, his family member, interested
person, institution or company notwithstanding his ability. does not pay;
or
(2) Accepts loans, advances, investments or any other financial benefits

in the name of himself, his family members, interested persons,
institutions or companies by providing fraud, deception or false

information from any bank-company or financial institution; or
(3) has used the said loan, advance, investment or financial facility or
part thereof for any purpose other than the purpose for which he had
received the loan, advance, investment or other financial facility from any
banking company or financial institution; or
(4) The security given against the loan or advance is transferred or
transferred without the prior written permission of any banking company

or financial institution granting the loan or advance:
Provided that, for the purposes of this definition, Bangladesh Bank may,
from time to time, issue instructions;
(Kakakak) “debt” means a debt defined in clause (c) of section 2 of the

Debt Courts Act, 2003 (Act No. 8 of 2003);”;
(b) after clause (g) the following new clause (g) shall be inserted,
namely:-
“(g) “controlled entity” or “controlled company” means any person, or

entity or any such entity or company of a company which—
(a) the person, institution or company holds or otherwise controls
substantial shares; or
(b) the said person or a member of his family is a director or a director of

the said institution or company or a director of any subsidiary company
of the said institution or company; or
(c) by any contract entered into with it or by any other means reserves
the right to appoint or remove directors or to exercise control over its
management or management;”;
(c) after clause (j) the following new clauses (jjh) and (jjhjh) shall be
inserted, namely:-
“(vii) “family” or “family member” means a person's wife, husband, father,
mother, son, daughter, brother, sister and any dependent of such person;
(vii) “representative director” means a person authorized under the

provisions of section 86 of the Companies Act, 1994 (Act No. 18 of
1994);”;
(d) after clause (k) the following new clauses (tot), (ttot) and (tottot) shall
be inserted, namely:-
“(Tot) “insurance company” means an insurer defined in clause (25) of

section 2 of the Money Insurance Act, 2010 (Act No. 13 of 2010):
(Totat) “person” means any person and includes any institution,
company, partnership, firm or any other body;
(Totat) “Banking Group” means the banking company and one or more of
its subsidiary companies by whatever name called;”;
(e) after clause (thththththth) the following new clause (ththththththth)

shall be inserted, namely:-
“(THTHTHTHTHTH) “money laundering” means money laundering as
defined in clause (f) of section 2 of the Prevention of Money Laundering

Act, 2012 (Act No. 5 of 2012);”; And
(f) after clause (d) the following new clause (dd) shall be inserted,
namely:-
“(cd) “terrorist financing offence” means the terrorist financing offense
defined in section 7 of the Anti-Terrorism Act, 2009 (Act No. 16 of
2009);”.
Amendment 4. Sub-section (3) of section 7 of the said Act-

of Section 7
of Act No. (a) for the words “Securities and Exchange Commission” mentioned
14 of 1991
therein, the words “Bangladesh Securities and Exchange Commission”
shall be substituted; And
(b) flanked by “.” A colon symbol “:” shall be substituted for the slash
symbol and then the following clauses shall be inserted, namely:-
"Provided, however, that the provisions of this sub-section shall not apply
in the case of providing security custodial services."
Amendment 5. In sub-section (2) of section 13 of the said Act, for the words "paid up
of Section
capital" the words "paid up capital" shall be substituted.
13 of Act
No. 14 of
1991

of Section
14 of Act
No. 14 of (a) for the words “paid up capital” mentioned in the footnote the words
1991
“paid up capital” shall be substituted; And
(b) in sub-section (1) of—
(b) for the words “paid up capital” mentioned in clause (b) the words
“paid up capital” shall be substituted; And
(a) in clause (e) for the words “paid up capital” the words “paid up
capital” shall be substituted.
Amendment 7. Section 14A of the said Act-

of Section
14A of Act (a) for sub-section (1) the following sub-section (1) shall be substituted,
No. 14 of
namely:-
1991
"(1) Bank shares shall not be concentrated among any person,
institution, company or members of the same family and no person,
institution, company or members of any family directly or indirectly, singly

or jointly with others or both, shall own 10 percent (ten ) shall not
purchase more than 100,000 shares.”; And
(b) the explanation mentioned after sub-section (6) shall be omitted.
Amendment 8. Section 14B of the said Act

of Section
14B of Act (a) for sub-section (1) the following sub-section (1) shall be substituted,
No. 14 of
namely:-
1991
"(1) Without the prior approval of Bangladesh Bank, no person,
institution, company or any member of any family, directly or indirectly,

singly or jointly with others or both, shall be a significant shareholder of
any bank-company."; And
(b) after sub-section (2) for the said explanation, the following shall be
substituted, namely:-
"Explanation.- Substantial shareholder" shall mean the holding of more
than 5 (five) percent of the ownership rights of a bank-company by any
person, institution, company or any family members directly or indirectly,

singly or jointly with others or both.

of Section
15 of Act (a) for the footnote “election of new directors” the footnote “election of
No. 14 of
directors, appointment of managing director or chief executive officer,
1991
etc.” shall be substituted;
(b) after the word “appointment” referred to in sub-section (4) the comma
and words “, re-appointment” shall be inserted and after the word

“appointment” the words “or re-appointment” shall be inserted;
(c) for sub-sections (9) and (10) the following sub-sections (9) and (10)
shall be substituted, namely:-
“(9) Notwithstanding anything contained in any other law for the time
being in force or in the articles of association/memorandum or articles of
association of any banking company, a banking company shall have a

maximum of 20 (twenty) directors including at least 3 (three)
independent directors;
Provided that if the number of directors of a bank-company is less than
20 (twenty) persons, the number of individual directors shall be at least 2
(two) persons:
Provided further that Bangladesh Bank may, from time to time, issue
instructions regarding the maximum number, fees and appointment of

individual directors.
Explanation.- In this sub-section, the term “independent director” shall
mean such person who is independent of the management and

shareholders of the banking company and who shall give his opinion
only in the interest of the banking company and who has past, present or
future relationship with the bank or any person associated with the bank.
No real interest or ostensible interest is involved.
(10) Notwithstanding any other law for the time being in force or anything
contained in the association/memorandum or association rules of any

banking company, more than 3 (three) members from any single family
shall hold the position of director of any banking company at the same
time.”; And
(d) the explanation mentioned after sub-section (12) shall be omitted.
Amendment 10. For section 15CC of the said Act, the following section 15CC shall be
of Section
15 of Act
No. 14 of
“15 cock. Tenure of office of directors, etc.-(1) Notwithstanding anything
1991
to the contrary contained in any other law for the time being in force or in
the articles of association/memorandum or articles of association of any

banking company, after the coming into force of the Banking Companies
(Amendment) Act, 2018, no person shall be a member of any banking
company. Cannot hold the position of director for more than 12 (twelve)
years consecutively.
(2) If a person under sub-section (1) holds the post of director of a bank-
company for 12 (twelve) years consecutively, he shall not be re-
appointed to the post of director of the said bank-company until 3 (three)

years have elapsed after the expiry of the said period. Not eligible.
Explanation.- For the purposes of this section, if a person has not held
the position of director for less than 3 (three) years, the said period shall
also be included in the calculation of 12 (twelve) years.
Insertion of 11. After section 15CC of the said Act the following new section 15CC
new section
15 of Act
No. 14 of “15 cock. Appointment of alternate directors, tenure, etc. -(1) Subject to
1991
the provisions of Section 101 of the Companies Act, if any director of a
bank company is absent from Bangladesh for at least 3 (three) months
uninterrupted stay abroad, if it is necessary to appoint an alternate
director in the bank company, the board of directors of the bank
company concerned shall 1 (one) Alternate Director may be appointed

against the Director for a maximum of 1 (one) time in a year for 3 (three)
months consecutively:
Provided that this provision shall not apply to any chairman or director,
by whatever name called, nominated or appointed by the Government.
(2) In case of appointment of alternate director, the provisions relating to

qualification and suitability of appointment of director shall be applicable.
(3) Bangladesh Bank may, from time to time, issue instructions regarding
appointment of alternate director and determination of his scope of
work.”
Amendment 12. After sub-section (7) of section 17 of the said Act, the following new
of Section
sub-section (7A) shall be inserted, namely:-
17 of Act
No. 14 of
"(7A) If any director who has received a notice under this section resigns
1991
from his office while the proceedings of the notice are in progress, such
resignation shall not take effect."

of Section
23 of Act (a) for the footnote “Restrictions on the appointment of general directors”
No. 14 of
the footnotes “Restrictions on the appointment of general directors, etc.”
1991
shall be substituted;
(b) in sub-section (1) of—
(b) for clause (a) the following clause (a) shall be substituted, namely:-
"(a) If a person is a director of a bank-company, he is at the same time a

director of any other bank-company, financial institution, insurance
company or any subsidiary company of such companies or any such

company or institution in the opinion of Bangladesh Bank which is the
said bank-company, financial institution or shall not be a director of such

company or institution exercising control, joint control or significant
influence over the insurance company;”;
(a) after clause (a) the following new clauses (cock), (cock) and (cock)
"(Cock) Subject to the provisions of sub-section (10) of section 15, the

board of directors of a bank-company may have representative directors
on behalf of not more than 2 (two) institutions or companies whose
interests are related to or under the control of a single family member;
(Cock) No more than 1 (one) person representative director can be
appointed on behalf of any institution or company in the board of

directors of any bank-company;
(Kakkak) No natural person shall be appointed as a representative

director on behalf of the shareholder in the board of directors of any
bank-company;”; And
(c) for clause (b) the following clause (b) shall be substituted, namely:-
“(b) no bank-company shall have any such director who-
(b) has been engaged in the position of external auditor, legal adviser,
adviser, consultant or in any other lucrative position of the said bank-
company;
(a) any other banking company, financial institution, insurance company

or any subsidiary company of such companies or any such company or
institution in the opinion of Bangladesh Bank which exercises control,

joint control or significant influence over the said banking company,
financial institution or insurance company; is engaged in an advisory,
consultancy or otherwise lucrative position in such company or

organization;
(e) the directors of some of such companies which together are entitled
to vote more than twenty (twenty) per cent of the total votes against the
total shares of the shareholders of the said bank-company;
(e) has been appointed as a director on behalf of any other banking
company, financial institution, insurance company or any subsidiary

company of such companies or in the opinion of Bangladesh Bank any
such company or institution which has control, joint control over the said
banking company, financial institution or insurance company; or has

been appointed as a director on behalf of such company or organization
exercising significant influence:
Provided that the provisions of this sub-section shall not apply to the
directors of specialized banks appointed by the Government:
Provided further that the provisions of this sub-section shall not apply to
the appointment of any officer as a director on behalf of a bank-company,
financial institution, institution or company which is state-owned and

created by special law.”
Amendment 14. The existing provision of section 26 of the said Act shall be
of Section
26 of Act numbered as sub-section (1) and the so numbered sub-section (1) of-
No. 14 of
(a) clause (d) shall be repealed;
1991
(b) Clause (e)—
(b) for the words “Bangladesh Bank” mentioned therein, the words
“Bangladesh Bank” shall be substituted; And
(a) in sub-clause (e), for the words “Securities and Exchange

Commission” the words “Bangladesh Securities and Exchange
Commission” shall be substituted; And
(c) after the following new sub-sections (2), (3) and (4) shall be inserted,
namely:-
“(2) No bank-company shall, for whatever purpose the subsidiary

company is formed, invest more than the rate or amount prescribed by
the Bangladesh Bank as capital in its subsidiary companies from time to

time.
(3) If, on inspection and examination conducted under section 44,
Bangladesh Bank is satisfied that the activities of any member of the

board of directors, managing director or chief executive officer of any
subsidiary company of any bank-company constituted under sub-section

(1) are related to the subsidiary. Harmful to the company or bank-
company or the depositor, if applicable against him or them in the
interest of the said subsidiary company or bank-company or the

depositor or in the public interest, Bangladesh Bank shall take necessary
measures at its own discretion or may issue necessary instructions to
the concerned bank-company or the said The subsidiary company shall

inform the controlling body for necessary action.
(4) If any subsidiary company of any banking company formed for the
purpose mentioned in sub-section (1) violates any condition imposed on
it or indulges in any harmful activity, then the said subsidiary company or
banking company or depositor or in the public interest of Bangladesh.

The bank will issue instructions to the concerned bank-company to take
any corrective measures.”
Amendment 15. Section 26A of the said Act-

of Section
26A of Act
No. 14 of (a) for sub-section (1) the following sub-section (1) shall be substituted,
1991
namely:-
“(1) Subject to the provisions of section 26, no banking company shall

hold shares in any other company in excess of the following amount,
namely:-
(a) 5 (five) percent of the total amount of the paid-up capital, share
premium, statutory reserves and retained earnings of the said bank-
company in the purchase price of the retained shares;
(b) 10 (ten) percent of the paid-up capital of the investee company:
Provided, however, that the amount of shares held in clauses (a) and (b)
above shall not exceed 10 (ten) percent of the paid-up capital of the said
bank-company:
Provided further that every bank-company shall reorganize its capital

market investment cell in such a manner that the total purchase price of
all types of shares, mutual funds, capital market instruments other than
the instruments mentioned in sub-section (2A) and its own subsidiary

companies directly or indirectly engaged in capital market activities. or
companies, loan facilities provided to any other company or companies
and the amount of subscription paid to any type of fund formed for the
purpose of investment in the capital market does not collectively exceed
25 (twenty five) percent of the total amount of its paid up capital, share
premium, statutory reserves and retained earnings."; And
(b) after sub-section (2) the following new sub-section (2A) shall be
inserted, namely:-
"(2a) The Bangladesh Bank shall, from time to time, issue instructions to
determine the limits of investment in bonds, debentures or instruments
based on Islamic Shariah by any banking company."
Amendment 16. Section 26C of the said Act-

of Section
26C of Act (a) for the word “person” mentioned in the footnote, the words “person or
No. 14 of
institution” shall be substituted; And
1991
(b) after sub-section (6) for the said explanation, the following shall be
“Explanation.- In this section “any person or institution connected with

the Bank” shall mean—
(a) any director, managing director or chief executive, significant

shareholder or member of their family or any such person in the opinion
of Bangladesh Bank who exercises control, joint control or significant
influence over the bank-company;
(b) any such company in which the person referred to in clause (a) has
control, joint control or significant influence over the bank concerned;
(c) any significant shareholder of any banking company in any company;
(d) any such person, institution or company as per the provisions issued
by the Bangladesh Bank, from time to time, who is or are related to any
banking company in the manner described in clauses (a), (b) and (c).

of Section
27 of Act (a) Sub-section (1)—
No. 14 of
1991 (b) for clause (b) the following clause (b) shall be substituted, namely:-
“(b) subject to the provisions of sub-section (2) of section 26C, shall not
grant any loan or advance other than a guarantee loan or advance to
any of its directors or a member of the family of a director or on the

assumption of liability by any of its directors or a member of the family of
a director; shall not provide loans, advances, guarantees or any other
financial facilities other than loans or advances;”;
(a) In clause (c) for sub-clause (a) the following sub-clause (a) shall be
“(a) any such interested institution or private company in which the said
bank-company or any member of its director or director's family is a
substantial shareholder, director, owner or partner or which is controlled

or influenced in any way by any director or member of the director's
family; ”;
(b) for sub-section (2) the following sub-section (2) shall be substituted,
namely:-
“(2) Subject to the provisions of sub-section (1), no bank-company shall

grant any loan, advance, guarantee or any other financial facility, without
the approval of a majority of the directors other than the directors
concerned, in the following cases—
(a) any of its directors or any member of the director's family; or
(b) any such person, commercial establishment, company with which or

in which any director or member of the director's family of the said
banking company is interested as a significant shareholder, partner,
director or guarantor or which is controlled in any way by any director or
member of the director's family or is affected.
Explanation.-In this section, “collateral” shall mean the eligible collateral
as determined by Bangladesh Bank, from time to time, in the instructions
issued.”; And
(c) in clauses (a) and (b) of sub-section (4), after the words “any director
thereof” the words “or a member of the director's family” shall be
inserted.
Amendment 18. For section 27A of the said Act, the following section 27A shall be
of Section
27A of Act
No. 14 of "27a. Restrictions on directors or members of management authorities of
1991
debtor companies or institutions. For the time being: Notwithstanding
anything contained in any other law in force, no resignation of any
director or member of the management authority of a debtor company or
institution shall be effective and no director shall transfer his shares or

Can't sell."
Amendment 19. For sub-sections (1), (2) and (3) of section 27CC of the said Act, the
of Section
27 of Act following sub-sections (1), (2) and (3) shall be substituted, namely:-
No. 14 of
“(1) Every banking company or financial institution shall, from time to
1991
time, send to the Bangladesh Bank a list of its defaulting borrowers in
accordance with the provisions of articles 43 and 44 of the Bangladesh
Bank Order, 1972 (PO No. 127 of 1972).
(2) Bangladesh Bank shall send the list received under sub-section (1) to
all banking companies and financial institutions in the country in
accordance with the provisions of article 45 of the Bangladesh Bank
Order, 1972 (PO No. 127 of 1972).
(3) No banking company or financial institution shall grant any loan

facility in favor of a defaulting borrower:
Provided that, if any defaulting person or, as the case may be, institution
or company belonging to a group of mutual interests is not a willful
defaulting borrower or if it appears to Bangladesh Bank that the said
person or institution or In case of failure by the company to repay the

loan due to reasonable cause, then no other institution or company
belonging to the group shall be deemed to be in default due to the said
person or institution or company being in default, and such institution or
company shall be granted loan facility subject to the prior approval of
Bangladesh Bank as per the instructions issued by it. will be provided.”
Insertion of 20. After section 27c of the said Act, the following new section 27b shall
new section
27B in Act
No. 14 of
"27 b. List of willful defaulting borrowers, etc. (1) Every bank-company or
1991
financial institution shall list the willful defaulting borrowers and as per
the instructions of Bangladesh Bank as per the provisions of article 43

and 44 of the Bangladesh Bank Order, 1972 (PO No. 127 of 1972) the
list of the said willful defaulting borrowers shall be submitted to the

Bangladesh Bank. will send
(2) The list obtained by Bangladesh Bank under sub-section (1), subject
to the provisions of sub-section (5) as per the provisions of article 45 of
Bangladesh Bank Order, 1972 (PO No. 127 of 1972) all the banking
companies and Will send to financial institution.
(3) Bangladesh Bank shall, from time to time, issue instructions
regarding the identification and finalization of willful defaulters.
(4) Before finalizing the name of the willful defaulting borrower, the
concerned borrower shall be given an opportunity to present his
statement, and after the finalization of the name of such borrower, every
banking company and financial institution shall inform the concerned

borrower within 7 (seven) working days.
(5) As a result of being identified as a willful defaulter as per the
provisions of sub-section (4), the aggrieved person or institution may

appeal to the Bangladesh Bank within 30 (thirty) days and the decision of
the Bangladesh Bank in this regard shall be considered final.
(6) Bangladesh Bank may forward the list of willful defaulting borrowers
to the relevant agencies and require them to be banned from traveling
abroad, banned from issuing trade licenses and banned from registering
companies with the Bangladesh Securities and Exchange Commission
and the Registrar of Joint Stock Companies and Firms (RJSC). If

requested to take action, the relevant government agency will take
necessary action to fulfill the purpose of this Act.
(7) A person or institution listed as a willful defaulter shall not be eligible
to be a director of any bank-company or financial institution until the
period prescribed by Bangladesh Bank, which shall not exceed 5 (five)

years, has elapsed after being exempted from the said list. .
(8) If the director of any bank-company or financial institution is listed as
a willful defaulter, the Bangladesh Bank may, subject to the provisions of

sub-section (5), declare his directorship vacant.
(9) If any person or institution is listed as a willful defaulter under sub-

sections (1) and (2), and no appeal is taken against such listing under
sub-section (5) or sub-section (5) If the appeal under this is not

approved, the concerned bank-company or financial institution shall
issue a notice to the said borrower after giving 2 (two) months time and
demanding full refund of the amount due from him.
(10) Notwithstanding anything contained in other provisions of this Act or

in any other law, if the willful defaulting borrower fails to pay the amount
due to him within 2 (two) months of the receipt of notice under the
provisions of sub-section (9), the bank concerned- The company or
financial institution, as the case may be, shall, with the approval of its
board of directors, institute criminal proceedings against it, and such
proceedings shall not prejudice the proceedings of the Money Debt
Court in respect of recovery of debts, advances or dues.
(11) If any banking company or financial institution contravenes the

provisions of this section, or if the Bangladesh Bank considers that any
banking company or financial institution has knowingly or willfully
contravened the provisions of this section, for such contravention the
said bank- A fine of not less than fifty (fifty) lakhs and not more than one
(one) crore rupees shall be imposed on the company or financial

institution, and if the said violation continues, an additional fine of not
less than one (one) lakh rupees for every day after the first day of such
violation. shall be imposed.”
Amendment 21. For section 28 of the said Act, the following section 28 shall be
of Section
28 of Act substituted, namely:-
No. 14 of
"28. Prohibition on waiver of interest or profit.- (1) Without the prior
1991
approval of Bangladesh Bank, no banking company shall waive any
interest or profit charged or uncharged on loans or investments received
from it by the following persons or institutions,-
(a) any of its directors, and members of his family;
(b) any such institution or company in which the said bank-company or
any of its directors or members of the director's family is a substantial
shareholder, director, guarantor, managing agent, owner or partner or

which by the said bank-company or any of its directors or members of
the director's family is controlled or influenced in any way;
(c) any such person with whom the said bank-company has interest as a
director, partner or guarantor.
(2) Any waiver made in contravention of the provisions of sub-section (1)

shall be invalid, and every director or officer thereof who was responsible
for such waiver shall be guilty of the said contravention and shall be
liable to imprisonment for a term not exceeding 3 (three) years or Shall
be punishable with a fine of up to 3 (three) lakh rupees or with both
penalties. ".
Insertion of 22. After section 29 of the said Act, the following new section 29A shall
new section
29A by Act
No. 14 of “29a. Enrollment of Collateral Appraisal Institutions or Companies.-(1) In
1991
the case of collateral given by any appraiser institution or company
against the loan or investment received or to be accepted by the loan or
investment receiver of a bank-company, such institution or company
shall be registered with Bangladesh Bank.
(2) For the purposes of sub-section (1), Bangladesh Bank may, from time
to time, issue necessary directions.”
Amendment 23. After the words "list of defaulting borrowers received" mentioned in
of Section
section 37 of the said Act, the comma, words and numbers ", list of willful
37 of Act
No. 14 of defaulting borrowers received under section 27B" shall be inserted.
1991
Amendment 24 In section 38 of the said Act, the footnote “Accounts and Balance
of Section
Sheet” shall be replaced by the footnote “Financial Report or Statement”.
38 of Act
No. 14 of
1991
Amendment 25. For sub-section (1) of section 39 of the said Act, the following sub-
of Section
section (1) shall be substituted, namely:-
39 of Act
No. 14 of
"(1) If any person qualified to be the auditor of a company under the
1991
Bangladesh Chartered Accountants Order, 1973 (PO No. 2 of 1973) or
any other law for the time being in force is approved and listed by the
Bangladesh Bank as qualified to audit bank-companies, section 38 May
audit the profit and loss account and financial report of the bank-
company according to the financial report prepared under.
Substitution 26. For section 44 of the said Act, the following section 44 shall be
of section
44 of Act
No. 14 of
1991
“44. Inspection.-(1) Notwithstanding anything to the contrary contained in

the Companies Act, or in any other law for the time being in force, or
registered under any other law, Bangladesh Bank may at any time be
registered in Bangladesh by one or more of its officers. A banking
company may inspect the books and accounts of all its branches and
subsidiaries within or outside Bangladesh and, in the case of a banking
company registered outside Bangladesh, may inspect the books and

accounts of all its branches located in Bangladesh, and on completion of
such inspection the Bangladesh Bank shall A copy of the report prepared
on the basis of inspection shall be furnished to the said bank-company.
(2) Notwithstanding any other law for the time being in force, and without
prejudice to the provisions of sub-section (1), the Bangladesh Bank may
at any time by one or more of its officers inspect the books and accounts
of any banking company and all its branches and subsidiaries. And in the
case of any banking company registered outside Bangladesh, the books
and accounts of all its branches located in Bangladesh may be

thoroughly examined and Bangladesh Bank may, if deemed necessary,
supply a copy of the report prepared on the basis of said examination to
the said banking company.
(3) In the case of a subsidiary company formed under section 26,
Bangladesh Bank shall supply a copy of the applicable part of the report
prepared on the basis of the inspection under sub-section (1) to the
concerned regulatory body of the inspected institution.
(4) To submit the ledgers, accounts or other documents of the concerned

bank-company and its branches and subsidiaries in accordance with the
demand of the person conducting the inspection under sub-section (1) or
the examination under sub-section (2) and within the period so

determined and the said It shall be the responsibility of the directors,
officers, employees or external auditors of the bank-company and its

branches and subsidiaries to provide any statement or information about
the bank-company and its branches and subsidiaries.
(5) The person conducting inspection under sub-section (1) or
examination under sub-section (2) shall administer oath to any director,

officer, employee or external auditor of the bank-company concerned
and its branches and subsidiaries. You can inquire about the affairs of
the company and its branches and subsidiaries.
(6) If, after carrying out any inspection or examination under this section,
the Bangladesh Bank is of the opinion that the operations of the said
banking company and any of its branches and subsidiaries are being
conducted in a manner contrary to the interest of its depositors, the
Bangladesh Bank, in writing By order-
(a) may prohibit the acceptance of new deposits by the said banking-
company;
(b) may file an application for winding up of the said bank-company

under sub-section (4) of section 64;
(c) Bangladesh Bank may issue such order or take such action as it
considers appropriate to protect the interests of the depositors.
(7) Bangladesh Bank may, after giving reasonable notice to the bank-
company concerned and its subsidiary company, publish the report

prepared by it or any part thereof.
(8) Notwithstanding anything contained in any other law for the time
being in force, any particulars or information subpoenaed by any court,
or by any authority other than the Bangladesh Bank, shall be so
confidential that the transfer or disclosure thereof would reveal
information on the following matters, which the banking-company or
detrimental to the interest of the depositor thereof, then the said banking
company shall not be bound to provide the said particulars or disclose

the information unless directed by any court or Bangladesh Bank,
namely:-
(a) such reserved funds which are not shown in the published financial
statements; or
(b) such debt is not recoverable or there is doubt as to the recoverable

thereof which is not shown therein; or
(c) such particulars of the banking company's liabilities, assets,

investments or business as are not disclosed in the published financial
statements; or
(d) customer credit information for any purpose other than the purposes
set out in the Banker Extrinsic Evidence Act, 2021 (Act No. 27 of 2021);
or
(e) Customer's deposit account statement for any purpose other than the
purpose specified in the Banker's Extrinsic Evidence Act, 2021 (Act No.
27 of 2021).
(9) Notwithstanding anything contained in any other law for the time
being in force, or registered under any other law, for the purpose of
verifying the utilization of the loan or investment money given by the
banking company in public interest or in the interest of the stability of the
banking sector, the Bangladesh Bank concerned loan or investment

recipient. Businesses can conduct on-site inspections.”
Insertion of 27. After section 44 of the said Act the following new sections 44A and
new
sections 44B shall be inserted, namely:-
44A and 44B
“44a. Inspection of institutions or foundations.-Notwithstanding anything
in Act No. 14
of 1991 contained in any other law for the time being in force, or registered under
any other law, the manner in which a bank-company is inspected or
directed to be inspected under sections 44 and 45 of this Act. Either,

Bangladesh Bank to inspect institutions or foundations, by whatever
name called, etc., constituted or managed under the Societies
Registration Act, 1860 (Act No. XXI of 1860) financed by bank-
companies or both, and all such institutions or Foundation, by whatever

name it may be called, etc., and Bangladesh Bank shall furnish a copy of
the applicable part of the report prepared on the basis of such inspection
to the concerned regulatory body of the inspected institution.
44 b. Special powers of Bangladesh Bank to examine the accounts of

such persons, institutions or companies, etc., dealing with bank
companies.- If Bangladesh Bank is satisfied that in public interest or in
the interest of banking policy or for the purpose of stability of the banking
sector, another regulatory body or any body of the government If it is

necessary to collect or examine the accounts, financial transactions or
any other information of any person, institution or company under which
there is any transaction with the bank-company, Bangladesh Bank is the
concerned controller to provide the said account, information, etc. If
requested by the agency or the relevant agency of the government, the
relevant regulatory agency or the relevant agency of the government
shall provide it.”
Amendment 28. After sub-section (3) of section 45 of the said Act, the following new
of Section
sub-section (4) shall be inserted, namely:
45 of Act
No. 14 of
“(4) In the manner directed to any banking company under this section,
1991
the Bangladesh Bank shall, under the Societies Registration Act, 1860
(Act No. XXI of 1860), be constituted or managed or both with the
financing of banking companies, institutions or foundations, which by
whatever name they may be called, etc., and may issue appropriate
orders.”

of Section
46 of Act (a) for sub-section (1) the following sub-section (1) shall be substituted,
No. 14 of
namely:-
1991
"(1) If Bangladesh Bank is satisfied that the chairman or any director or
chief executive of any bank-company has engaged in any activity or

interest-related transaction harmful to any bank-company or its
depositors, misappropriation of funds of the bank-company or in money

laundering or terrorist activities. In order to prevent financial crimes or to
ensure the proper management of the said bank-company in the public
interest, it is necessary to remove the said chairman, director or chief
executive, by whatever name he may be called, if the Bangladesh Bank,
recording the reasons, by order, the said chairman, The Director may
remove the Chief Executive from his office.”;
(b) for sub-section (3) the following sub-section (3) shall be substituted,
namely:-
“(3) If the chairman or director or chief executive of any banking

company is removed under sub-section (1), he shall not continue as
chairman or director or chief executive of the said banking company, and
he shall from the date of the order 3 (three) years shall not be connected
or participate in the management of the said bank-company or any other
bank-company or financial institution, directly or indirectly.”
(c) sub-section (6) and its provisions shall be repealed.”; And
(d) after sub-section (6) the following new sub-section (7) shall be
inserted, namely:-
"(7) If a banking company suffers financial loss due to the harmful

activities of a removed chairman or director or chief executive under sub-
section (1), the banking company concerned may take appropriate legal
action to recover the compensation due from him, and In this case the
provisions of section 85 shall apply as far as possible, and the measures

taken shall be communicated to the concerned bank-company
Bangladesh Bank.”
Amendment 30. For the words "loan waiver" mentioned in clause (f) of sub-section (1)
of Section
49 of Act of section 49 of the said Act, the words "interest or profit waiver, loan"
No. 14 of and comma shall be substituted.
1991
Amendment 31. Sub-section (3) of section 57 of the said Act shall be repealed.
of Section
57 of Act
No. 14 of
1991
Insertion of 32. After section 77 of the said Act, the following new section 77A shall
new section
77A by Act
No. 14 of
"77a. Provisions relating to quick corrective action of banking companies
1991
by Bangladesh Bank.-(1) Notwithstanding anything contained in any
other law or any agreement or document or any other provision of this
Act, in the interest of any banking company or its depositors or in the
public interest, the said bank- In order to ensure the sound management
of the company, Bangladesh Bank may issue instructions regarding the

operations and management of the concerned bank-company to take
immediate corrective measures.
(2) If any bank company fails to implement the recovery action plan in
the measures taken under this section or if the chairman, director, chief
executive or senior management officer of the said bank company fails
to follow the recovery action plan, the activities are harmful to the bank
company concerned or its depositors. continues, then Bangladesh Bank

to take any one or more special measures regarding its compulsory
merger with any other banking company or its reorganization, subject to
the provisions of section 77, with a view to ensure the proper

management of the said banking company in the interest of the
depositors or in the public interest. Can."

of Section
109 of Act (a) for the word “two” mentioned in sub-section (1) the number, bracket
No. 14 of
and word “5 (five)” shall be substituted and for the word “twenty” the
1991
number, bracket and word “50 (fifty)” shall be substituted;
(b) after sub-section (1) the following new sub-section (1A) shall be
inserted, namely:-
“(1a) If any society or institution or company, in contravention of the
provisions of section 8, uses the word “bank” as part of its name or any
other word derived from it which is likely to be regarded as a bank-
company, such society shall or the organization or company and its

management and its associated directors, managing director or chief
executive officer, by whatever name called, shall each be liable to a fine
not exceeding fifty (fifty) lakhs of rupees or to imprisonment for a term
not exceeding seven (seven) years or to both for the said contravention.
and if the said violation continues, a fine not exceeding 1 (one) lakh
rupees shall be imposed for every day.”
(c) for the words “shall be punished with imprisonment and a fine not
exceeding one lakh rupees” mentioned in sub-section (2) the words

“shall be punished with imprisonment or a fine not exceeding five (five)
lakhs rupees or with both” the words, numbers and brackets shall be
substituted;
(d) for the word “one” referred to in sub-section (3) the number, bracket
and word “5 (five)” shall be substituted and for the word “ten” the
number, bracket and word “20 (twenty)” shall be substituted;
(e) for sub-sections (4), (5), (6) and (7) the following sub-sections (4),
(5), (6) and (7) shall be substituted, namely:-
“(4) If any person under sub-section (2) of section 44 submits any

statement, account, or any other document, or furnishes any particulars
or information, or investigates or examines the affairs of the business of

a banking company. refuses to answer any question of any officer in
charge, then a fine of not less than 20 (twenty) thousand taka and not
more than 5 (five) lakh taka will be imposed on him for the said non-
compliance, and if the said non-compliance continues, on the first day of
such non-compliance An additional penalty of at least 1 (one) thousand

taka will be imposed for each day thereafter.
(5) If any bank-company accepts any deposit in contravention of any
order made under clause (a) of sub-section (6) of section 44, each of its
directors or officers who were responsible for accepting such deposits
shall, under the said clause ( (a) shall be guilty of contravention of any
order made thereunder and shall be liable to a fine not exceeding twice
the amount of such deposit.
(6) If any person fails to comply with the conditions or duties of any
scheme sanctioned under sub-section (8) of section 77, he shall be liable
to a fine not less than twenty (twenty) thousand and not more than five
(five) lakhs and If this failure continues, an additional penalty of not less
than 1 (one) thousand taka for every day after the first day of said failure
shall be imposed.
(7) If any person contravenes any other provision of this Act, or

contravenes any order or direction issued thereunder or any condition
imposed or any rule made, he shall be fined not less than 20 (twenty)
thousand taka and not more than 2 ( (ii) shall be liable to a fine of one
lakh rupees, and if such contravention continues, an additional fine of not

less than one (one) thousand rupees shall be imposed for every day
after the first day of such contravention.”;
(f) for the words, figures and brackets mentioned in sub-section (9) “sub-
section (3)” the words, figures, brackets and commas shall be

substituted “sub-section (2), (3)”; And
(g) for sub-section (11) the following sub-section (11) shall be

"(11) If any banking company fails to comply with sub-section (7) of

section 13, sub-sections (3), (4) and (5) of section 25, sub-section (3) of
section 26A, sub-section (3) of section 29 Violates the provisions of any
section other than in sub-section (3), and sub-section (5) of section 33 or
contravenes any order or direction issued thereunder or any condition
imposed or any rule made thereunder, then for such contravention A fine
of not less than 3 (three) lacs and not more than 30 (thirty) lacs shall be
imposed on the said bank-company, and if such violation continues, an
additional fine of not less than 5 (five) thousand and not more than 5
(five) thousand takas for every day after the first day of such violation. A
fine of 50 (fifty) thousand taka shall be imposed.”
Insertion of 34. After section 111 of the said Act the following new section 111A shall
section 111A
by Act No.
14 of 1991
“111a. Applicability of certain provisions of this Act and other laws.-Any
fine or punitive measure or penalty imposed on any banking company or
person under any section of this Act shall not be imposed on such
banking company or person under any other section of this Act or under
any other law in force in Bangladesh. shall not limit or preclude the
imposition of any such fine or penalty or penalty imposed or imposed.”
Copyright © 2019, Legislative and Parliamentary Affairs Division
Ministry of Law, Justice and Parliamentary Affairs

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27/12/2023 The Banking-Company (Amendment) Act, 2023

The Banking-Company (Amendment) Act, 2023

[ June 26, 2023 ]

An Act to further amend the Bank-Company Act, 1991

Therefore it is hereby enacted as follows:-

(2) It shall take effect immediately.

Amendment 2. Section 3 of the Bank-Company Act, 1991 (Act No. 14 of 1991),

(b) sub-section (3) shall be repealed.

Amendment 3. Section 5 of the said Act-

“(cock) “financial report” or “statement” means a financial statement as

defined in sub-section (3) of section 2 of the Financial Reporting Act,

(CCCC) “Willful Defaulting Borrower” means any such Defaulting

(2) Accepts loans, advances, investments or any other financial benefits

institutions or companies by providing fraud, deception or false

banking company or financial institution; or

(4) The security given against the loan or advance is transferred or

transferred without the prior written permission of any banking company

from time to time, issue instructions;

(Kakakak) “debt” means a debt defined in clause (c) of section 2 of the

“(g) “controlled entity” or “controlled company” means any person, or

(a) the person, institution or company holds or otherwise controls

(b) the said person or a member of his family is a director or a director of

of the said institution or company; or

the right to appoint or remove directors or to exercise control over its

“(vii) “family” or “family member” means a person's wife, husband, father,

(vii) “representative director” means a person authorized under the

“(Tot) “insurance company” means an insurer defined in clause (25) of

(Totat) “person” means any person and includes any institution,

company, partnership, firm or any other body;

its subsidiary companies by whatever name called;”;

(e) after clause (thththththth) the following new clause (ththththththth)

“(THTHTHTHTHTH) “money laundering” means money laundering as

defined in clause (f) of section 2 of the Prevention of Money Laundering

“(cd) “terrorist financing offence” means the terrorist financing offense

defined in section 7 of the Anti-Terrorism Act, 2009 (Act No. 16 of

Amendment 4. Sub-section (3) of section 7 of the said Act-

shall be substituted; And

symbol and then the following clauses shall be inserted, namely:-

in the case of providing security custodial services."

Amendment 6. Section 14 of the said Act-

(b) in sub-section (1) of—

“paid up capital” shall be substituted; And

Amendment 7. Section 14A of the said Act-

institution, company or members of any family directly or indirectly, singly

purchase more than 100,000 shares.”; And

(b) the explanation mentioned after sub-section (6) shall be omitted.

Amendment 8. Section 14B of the said Act

institution, company or any member of any family, directly or indirectly,

any bank-company."; And

"Explanation.- Substantial shareholder" shall mean the holding of more

than 5 (five) percent of the ownership rights of a bank-company by any

person, institution, company or any family members directly or indirectly,

Amendment 9. Section 15 of the said Act-

and words “, re-appointment” shall be inserted and after the word

shall be substituted, namely:-

association of any banking company, a banking company shall have a

Provided that if the number of directors of a bank-company is less than

20 (twenty) persons, the number of individual directors shall be at least 2

instructions regarding the maximum number, fees and appointment of

Explanation.- In this sub-section, the term “independent director” shall

mean such person who is independent of the management and

contained in the association/memorandum or association rules of any

(d) the explanation mentioned after sub-section (12) shall be omitted.