The government has decided to abolish Section 18A of the Bank Resolution Act 2026, which allowed former shareholders and directors of troubled banks to regain ownership under certain conditions. Finance Minister Amir Khasru Mahmud Chowdhury announced the decision during Monday’s budget discussion in the National Parliament, stating that the move followed feedback from various stakeholders. He emphasized that those responsible for misappropriating public funds would not be spared and that depositors’ interests would be protected.

Section 18A, added during the law’s passage, had permitted previous owners of weak banks to apply to Bangladesh Bank to reacquire shares, assets, and liabilities after meeting several conditions, including repayment of government or central bank funds. The clause drew criticism from opposition parties, economists, Transparency International Bangladesh, and bankers, who argued it opened the door for controversial business groups to regain control. Media reports also indicated that the World Bank had raised objections.

The Bank Resolution Act enabled the merger of five Islamic banks—EXIM Bank, Social Islami Bank, First Security Islami Bank, Union Bank, and Global Islami Bank—whose combined defaulted loans reportedly reached about Tk 1.47 trillion. The finance minister’s announcement aims to restore depositor confidence in the banking sector.