Bangladesh wants Nobel winner to quit Grameen Bank

By Serajul Islam Quadir

DHAKA, March 1

Bangladesh's central bank piled pressure on Tuesday on Nobel laureate Muhammad Yunus to quit microlender Grameen Bank, saying he had to retire, echoing a demand for him to step down from the finance minister.

Yunus, 70, set up Grameen Bank and has been its managing director since 2000. Lauded abroad by politicians and financiers, he has been under attack from the government of Prime Minister Sheikh Hasina since late last year, after a Norwegian documentary alleged Grameen Bank was dodging taxes.

Yunus has denied any financial irregularities and his supporters say he is being discredited by the government because of a feud with Hasina dating back to 2007, when he tried to set up a rival political party while Bangladesh was ruled by an interim military government.

A central bank official said a letter had been sent to the Finance Ministry demanding Yunus retire immediately because he had been in his post at Grameen for nearly a decade longer than the law allowed.

The official retirement age of managing directors at commercial banks is 60.

"It is a clear violation of the existing law of banks," said the official, who declined to be identified.

Grameen Bank said it had not received any notification from the central bank, and Yunus has said the bank's board, which is mainly made up of borrowers, allows him to stay on as long as he is able to perform his duties.

"There is no directive on Professor Yunus to cease functioning as managing director, nor is there any suggestion of his being removed him from this post," spokeswoman Jannat-E-Quanine said in a statement.

The board held a meeting late on Monday and discussed "all issues involved", but nothing was decided on Yunus, the spokeswoman said.

Late last year, the government, which holds a 25 percent stake in the microlender, appointed a new chairman critical of Yunus, a move supporters of the so-called banker to the poor said was ultimately aimed at the state taking over the bank.

This month, Finance Minister Abul Maal Abdul Muhith said Yunus should step down, as he was now "old and we need to define the bank's role and bring it under close regulation".

Hasina herself has called Yunus a "blood-sucker of the poor" and sharply criticised Grameen Bank's microlending practices, especially after the Norwegian documentary that alleged the bank had for tax purposes shifted funds provided by Norway's aid agency in the 1990s from one legal entity to another.

The documentary sparked criticism in Bangladesh and abroad of Yunus, whose bank has provided about $10 billion in small loans to people, most of them women, to fund businesses and help them escape poverty.

A Norwegian government investigation into the allegations, however, found no evidence of misuse of funds or corrupt practices.

Yunus has been summoned to appear in three separate court cases involving Grameen Bank in Bangladesh over the past month.

On Tuesday, Friends of Grameen, a group of supporters that includes former Irish President Mary Robinson, criticised the bank's new chairman, Muzammel Huq, for publicly calling Yunus "a chicken-hearted man" and said the government was hurting its own credibility by waging a campaign against Yunus.

"Grameen Bank is an asset for Bangladesh, and so is Professor Yunus," group member and former International Monetary Fund director, Michel Camdessus, said in a statement.

"Acting not only lawfully, but also fairly to them, and with proper recognition of the immense contribution of Professor Yunus will be fundamental for the Government of Bangladesh to maintain its image of rectitude and of concern for the best service of the poor."

Yunus won the Nobel peace prize in 2006 for his work to end poverty through microfinance.

(Reuters)