An amendment bill is now in parliament to block resolved banks' owners responsible for the lenders' distress from regaining their ownership or control after resolution of the banks.
The Bank Resolution (Amendment) Bill 2026 was placed before parliament Thursday to tighten the legal framework for resolving troubled banks and prevent former owners and directors responsible for banking distress from regaining control.
Finance Minister Ameer Khosru Mahmud Chowdhury placed the bill in the Jatiya Sangsad. On his request, the bill was subsequently sent to the parliamentary standing committee on the Ministry of Finance for further scrutiny.
A key provision of the proposed amendment is the scrapping of Section 18A of the Bank Resolution Act 2026, effectively closing legal avenues for ousted controlling shareholders, former directors and distressed business groups to reclaim ownership, assets or management control of banks that have been "restructured, merged or otherwise resolved under the law".
The amendment provides that former controlling shareholders, board members and affiliated business groups held responsible for the financial distress of a bank will be barred from regaining ownership or managerial control through the resolution process.
The move tends to remove a controversial mechanism introduced through the Bank Resolution Ordinance 2025, and subsequently incorporated into the Bank Resolution Act 2026. The provision had allowed former owners to re-acquire shares in a resolved bank if they could meet prescribed capital-adequacy requirements.
The Bank Resolution Ordinance 2025 was promulgated to provide timely solutions to risks arising from capital shortfalls, liquidity crises, insolvency or other threats to the survival of scheduled banks, while ensuring overall financial stability.
The ordinance was later placed in the first session of the 13th Jatiya Sangsad as a bill to turn it into an act. The bill was subsequently referred to a special parliamentary committee for detailed scrutiny.
The committee recommended that the ordinance be enacted with amendments. Following its recommendations, some provisions were separated from the main legislation for implementation through rules.
However, taking into consideration the "government's potential financial liabilities, the interests of bank customers and the realities of the country's banking sector", a new Section 18A was incorporated into the proposed law before it was placed in parliament.
The Bank Resolution Act 2026 was subsequently passed in the form in which it was placed before the House.
The latest amendment bill now seeks to remove that provision, signalling a stricter approach towards former owners and directors of troubled banks and limiting the possibility of their returning to control through the resolution process. The proposed change is expected to strengthen the authorities' ability to restructure or resolve distressed banks while protecting depositors and reducing the risk of public funds.
