BB sets 30 as min age for bank directors

The Bangladesh Bank (BB) has issued a notification outlining guidelines for the composition of a bank's board of directors, stipulating a minimum age of 30 and restricting the number of directors from a single family to a maximum of three.

The Banking Regulations and Policy Department (BRPD) of the regulator on Sunday issued the cercular to ensure dynamism and good governance in the banking sector.

The central bank also prescribed the responsibilities of the directors as per the “Bank Company Act.” The notification was sent to the managing directors and chief executive officers of all scheduled banks for immediate execution, reports UNB.

According to the notification, the number of directors of a bank will be a maximum of 20, and independent directors will be three. The directors should have 10 years of management business or professional experience.

However, if there are less than 20 directors, there cannot be more than two independent directors. At the same time not more than three members from a single family can be directors, the notification stated.

According to the central bank, this policy has been formulated to ensure good governance in the banks. At the same time, the board of directors of the bank must be formed by suitable and professionally competent persons to carry out the business activities properly and smoothly.

“The bank's activities are mainly conducted with the money of the depositors. In this case, it is essential to protect the interest of the depositors. For this reason, the responsibility of the board of directors of a bank company is more important than that of other companies,” the BB notification stated.

Amendments were brought in the Bank-Company Act in 2023 to ensure good governance in the banking sector.