Thursday, October 25, 2007

Changes to Grameen Bank's structure

Thanks to the Military backed Government currently running Bangladesh, Grameen Bank has achieved certain relaxation in the norms governing its functioning. It has to be noted that it was during the time of General Ershad, the military dictator, that Grameen Bank came into being. The current changes are:
  • Grameen Bank allowed to operate branches in urban areas. Earlier they could open branches only in the rural areas.
  • Government stake cut down from 25% to 15%. Note that when the Bank started, Government had a stake of 60%.
  • Number of Government nominated directors brought down to 2 from 3.
  • Chairman of the bank will be appointed by the board instead of Government nomination which existed until now.
This move will strengthen Muhammad Yunus to be at the helm of the bank for quite a while to come. When Yunus decided to run for elections, the political parties got quite antsy. Of course, all legislations can be amended again by newly elected Government, but there could be a lot of resistance form People if such moves are seen as inimical to them.

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