MICROCAPITAL BRIEF: Dr Muhammad Yunus Appeals Bangladesh High Court Decision Upholding His Removal as Managing Director of Microfinance Institution (MFI) Grameen Bank

Grameen Bank Founder and Nobel Peace Prize Winner Dr Muhammad Yunus has appealed against the Bangladesh High Court’s recent ruling in favor of an attempt by the Bangladesh Bank (BB), the central bank of Bangladesh, to remove Dr Yunus from his position as managing director of Grameen Bank. [1] [2]. The Grameen Bank is a Bangladeshi microfinance institution (MFI) that manages total assets of USD 1.4 billion.

Dr Yunus had challenged the central bank’s decision based on the grounds that the move was politically motivated [2]. The court however upheld the argument that the appointment of Dr Yunus in 1999, without central bank approval, was invalid [2]. The court also backed the central bank’s argument that Dr Yunus, aged 70, is in violation of the mandatory legal retirement age of 60 years [2].

By: Alexandra Pattee, Research Associate

About Grameen Bank: Grameen Bank is a Bangladeshi microfinance institution that provides collateral-free loans to poor entrepreneurs in rural areas. It was founded in the late 1970’s by Muhammad Yunus, who, along with Grameen Bank, won the 2006 Nobel Peace Prize for his work in developing the concept of microfinance. As of February 2010, Grameen reports 8 million borrowers, 97 percent of whom are women. With 2,563 branches, Grameen Bank provides services in 81,343 villages. Grameen Bank has the equivalent of USD 1.4 billion in assets as of 2009 as indicated by the Microfinance Information Exchange (MIX), the US-based microfinance data provider.

About Bangladesh Bank (BB): Bangladesh Bank (BB) is the central bank of Bangladesh. BB is the chief regulator of the country’s monetary and financial system. Established in 1972, BB’s mission is to regulate reserves, to manage country’s monetary and credit system and to foster development of the country’s economy. As of December 2010, BB operates nine branches and has a total staff of 5,071. Atiur Rahman was appointed as Bank Governor in 2009 and remains in that capacity as of 2011.

Sources and Resources:

[1] Reuters, “Bangladesh’s Yunus appeals against removal from bank”, http://in.reuters.com/article/2011/03/09/idINIndia-55433820110309

[2] MicroCapital.org Article, March 8, 2011, “Bangladeshi Court Confirms Central Bank Decision to Remove Dr Yunus as Managing Director of Microfinance Institution (MFI) Grameen Bank”, https://www.microcapital.org/microcapital-brief-bangladeshi-court-confirms-central-bank-decision-to-remove-dr-yunus-as-managing-director-of-microfinance-institution-mfi-grameen-bank/

MicroCapital.org Article, March 14, 2011, “Crowd of 20,000 Protests Bangladesh Bank Attempts to Remove Dr Yunus as Managing Director of Microfinance Institution (MFI) Grameen Bank, US Secretary of State Clinton Among Those Offering Support”, https://www.microcapital.org/microcapital-brief-crowd-of-20000-protests-bangladesh-bank-attempts-to-remove-dr-yunus-as-managing-director-of-microfinance-institution-mfi-grameen-bank-us-secretary-of-state-clinton-among-those/

MicroCapital.org Article, March 2, 2011, “Yunus Continues as Grameen Bank Managing Director after Bangladesh Bank Asks Him to Step Down”, https://www.microcapital.org/microcapital-brief-yunus-continues-as-grameen-bank-managing-director-after-bangladesh-bank-asks-him-to-step-down/

MicroCapital.org Article, February 15, 2011, “Bangladeshi Government Asks Yunus to Step Down as Director of Grameen Bank”, https://www.microcapital.org/microcapital-brief-bangladeshi-government-asks-yunus-to-step-down-as-director-of-grameen-bank/

MicroCapital.org Article, January 10, 2011, “Founder of Grameen Bank and Nobel Peace Prize Winner Dr Muhammad Yunus Speaks Out Against the Commercialization of Microfinance Institutions (MFIs)”, https://www.microcapital.org/microcapital-brief-founder-of-grameen-bank-and-nobel-peace-prize-winner-dr-muhammad-yunus-speaks-out-against-the-commercialization-of-microfinance-institutions-mfis/

MicroCapital.org Article, December 24, 2010, “Bangladesh Government to Investigate Allegations of ‘Financial Irregularities’ Against Microfinance Institution (MFI) Grameen Bank”, https://www.microcapital.org/microfinance-brief-bangladesh-government-to-investigate-allegations-of-%E2%80%9Cfinancial-irregularities%E2%80%9D-against-microfinance-institution-mfi-grameen-bank/

MicroCapital’s Microfinance Universe: Grameen Bank, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Grameen+Bank

MicroCapital’s Microfinance Universe: Bangladesh Bank, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Bangladesh+Bank+%28BB%29

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