Saudi Arabian prince's Dh1.21b bid for Rupali Bank approved

Dubai: The Bangladesh cabinet on Wednesday approved a $330 million (Dh1.21 billion) bid offer by Saudi Prince Bandar Bin Mohammad Bin Abdul Rahman Al Saud for a 67 per cent stake in its troubled Rupali Bank.

The decision cleared the last hurdle in the prince's takeover of the bank, pending the Prime Minister's nod which is deemed a formality.

Rupali Bank Limited (RBL) one of Bangla-desh's four remaining state-owned commercial banks is estimated to have a value of around $2 billion.

The prince will pay $330 million in a single chunk before signing the agreement. About $200 million of the amount will be spent for liabilities of the bank that include defaulted loans and pension.

Privatisation Commission chairman Inam Ahmad Chowdhury told the media that he is hopeful to complete the agreement with Prince Bandar by the month-end.

Expansion

A source close to Prince Bandar told Gulf News from Dhaka that Rupali Bank will soon open branches in Saudi Arabia, host to more than a million Bangladeshi expatriates.

"Non-resident Bangla-deshis will have another banking outlet to remit money and possibly take home loans as and when they need as Prince Bandar is committed to expand the bank's network to Saudi cities," the source said.

"The Prince will soon travel back to Dhaka to sign the agreement following the Prime Minister's approval."

The Prince in July told Bangladesh officials he would invest $6 billion in different emerging sectors of the Bangladesh economy if the royal family was allowed to buy Rupali Bank.

He also pledged to park a hefty sum with Bangladesh Bank as deposits, which will give a much-needed boost to the country's flagging foreign exchange reserves.

The financial sector of Bangladesh consists of Bangladesh Bank, the country's central bank, four state-owned commercial banks, five government-owned development institutions, 30 private commercial banks, 10 foreign commercial banks, and 28 non-bank financial institutions. The financial sector also embraces insurance firms, stock exchanges and co-operative banks.

Of the 49 banks, five local banks and one foreign bank act as Islamic banks. Rupali Bank's 492 branches represent eight per cent and the banks assets represent four per cent of the banking system totals.