Bangladesh Nobel laureate removed from bank he founded
Dhaka, Dhaka, Bangladesh (AHN) – Nobel laureate Professor Muhammad Yunus, who dreamed of transferring poverty to museums by 2020, has been removed as head of the microfinance bank he founded.
Yunus, who created the celebrated microfinance Grameen Bank (Village Bank) yielded to months of political intimidation by the government.
The central bank issued a letter Wednesday evening announcing that Yunus had been relieved of his duties as managing director of Grameen Bank.
The deputy general manager (protocol) of the Bangladesh Bank governor’s secretariat, AFM Asaduzzaman, confirmed the sacking of Yunus, according to online wire service bdnews24.com.
Early on Tuesday, finance minister Abul Maal Abdul Muhith confirmed to journalists that his ministry had received a letter from the Bangladesh Bank saying the continued employment of 70-year-old Yunus as managing director of Grameen Bank was illegal.
Reports published in various newspapers claimed that the letter cited Article 14(3) of the Grameen Bank Ordinance-1983 and stated that the Nobel laureate should not stay on as the bank’s managing director. The article referred to specifies the retirement age and deems as ineligible people above 60 years of age.
On Feb. 15, the finance minister told BBC radio that Yunus should resign from his position at Grameen Bank. “He has even reached the (retirement) age limit for holding the office of a private bank chief.”
The squabble began after Norwegian television network NRK broadcast a documentary on Nov. 30 titled “Fanget i Mikrogjeld” or “Caught in micro debt.” According to the documentary, Yunus transferred funds destined for Grameen Bank to Grameen Kalyan, which was in no way involved with micro-credit operations.
A five-member committee headed by Professor Manowar Uddin Ahmed of the economics department at Dhaka University was formed in early January to look into the allegations raised by the documentary.
Responding to the allegations, Grameen Bank claimed there was no wrongdoing in the agreement between the bank and Grameen Kalyan, under which it received BDT 3,917 million from Grameen Bank.
For weeks the Bangladesh Bank, the Finance Ministry and the Law Ministry were in disagreement with each other about the methods to sack Yunus from his position.
The government’s continued attempts to find a way to force Yunus out of the Grameen Bank are occurring despite the United States government ramping up pressure on the Bangladesh government to back down.
Earlier in the week, US Secretary of State Hillary Clinton told Prime Minister Sheikh Hasina, that they would stop all high-level diplomatic interactions with Bangladesh unless the government resolved the crisis amicably.
The Bangladesh government has a 25 percent stake of the private Grameen Bank, which could be traced back in 1976 when it began as a project at Jobra village in Chittagong.
The bank for the poor has empowered nearly 8 million mostly rural women, who were able to break the threshold of poverty and hopelessness.
The microfinance concept developed by Yunus has been replicated across the globe.
Yunus, a Fulbright scholar at Vanderbilt University and a professor at the University of Chittagong, launched a research project to examine the possibility of designing a credit delivery system to provide banking services targeted to the rural poor. In October 1983, the Grameen Bank Project was transformed into an independent bank by government legislation.
The organization and its founder, Yunus, were jointly awarded the Nobel Peace Prize in 2006.
Development analysts critiquing the bank said it has “landed poor communities in a perpetual debt-trap,” and that its ultimate benefit goes to the corporations that sell capital goods and infrastructure to the borrowers. Reanalyzing the bank’s claims, critics found that 5 percent of the Grameen borrowers get out of poverty every year.
The bank has also attracted brickbats from Prime Minister Hasina, who argued that, “There is no difference between usurers [Yunus] and corrupt people.”
Hasina touches upon one criticism of Grameen Bank: the high rate of interest it demands from those seeking credit. Similar to all microfinance institutes, the interest charged by Grameen Bank is high compared to that of traditional banks, as Grameen’s interest (reducing balance basis) on its main credit product is about 20 percent.
Maulana Ibrahim, a reactionary imam in Bangladesh, attacked the Grameen Bank in 1993 for fostering “un-Islamic ways,” alleging that women were taking a vow not to obey their husbands and not to live in poverty anymore.
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