1. (1) Every new bank shall carry on and transact all kinds of banking business.

(2) Without prejudice to the generality of the foregoing provision, every new bank may, in particular, carry on and transact the following kinds of business, namely:-

(a) advancing and lending of money, and opening of cash credits upon the security of-

(i) stocks, funds and securities in which a trustee is authorised to invest trust money by any law for the time being in force;

(ii) debentures or other securities for money issued under the authority or any law for the time being in force or under the authority of the Government;

(iii) goods which, or the documents of title to which, are deposited with or assigned to, the bank as security for such advances, loans or credits;

(iv) debentures of companies with limited liability, subject to such directions as may be issued by the Board;

(v) shares of companies with limited liability, in accordance with such directions in this regard as may be issued from time to time by the Bangladesh Bank;

(vi) goods, including tea crops and raw or finished jute products which are hypothecated to the bank as security for such advances, loans or credits;

(vii) accepted bills of exchange and promissory notes endorsed by the payees;

(viii) immovable property or documents of title relating thereto, subject to such directions as may be issued from time to time by the Bangladesh Bank:

Provided that any advances or loans which are guaranteed by the Government may be made without any specified security.

(b) selling and realisation of proceeds or sale of any such promissory notes, debentures, stock receipts, bonds, annuities, stocks, shares, securities or goods which, or the documents of title to which, have been deposited with, or pledged, hypothecated, assigned or transferred to, the bank as security for such advances, loans or credits or which are held by the bank or over which the bank is entitled to any lien or charge in respect of any such advance or loan or credit or any debt or claim of the bank, and which have not been redeemed in accordance with the terms and conditions, if any, of such deposits, pledge, hypothecation, assignment or transfer;

(c) advancing and lending of money to Courts of Wards upon the security of estates in their charge or under their superintendence and the realisation of such advances or loans and any interest due thereon;

(d) issuing of letters of credit;

(e) buying and selling of gold and silver whether coined or uncoined;

(f) receiving of deposits and keeping cash accounts and accepting of jewelleries, title deeds, and other valuable goods on such terms as may be agreed on;

(g) managing, selling and realising of all properties, whether movable or immovable, which may in any way come into the possession of the bank in satisfaction or part satisfaction of any of its claims, and the acquisition and holding of, and generally the dealing with, any right, title or interest in any property, movable or immovable, which may be the bank’s security for any advance or loan may be connected with any such security;

(h) transacting of pecuniary agency business on commission and entering into contracts of indemnity, suretyship or guarantee with specific security or otherwise and the underwriting, participation in, and carrying out of the issue of any stocks, shares, debentures and other securities;

(i) administration of estates for any purpose whether as an executor, trustee or otherwise and the acting as agent on commission in the transaction of the following kinds of business, namely:-

(i) buying, selling, transferring and taking charge of any security or any share in any public company and also receiving the proceeds thereof, whether principal, interest or dividend;

(ii) remittance of such proceeds by public or private bills of exchange, payable either in Bangladesh or elsewhere;

(j) drawing of bills of exchange and the granting of letters of credit payable out of Bangladesh;

(k) buying of bills of exchange payable out of Bangladesh;

(l) borrowing of money for the purpose of the bank’s business, and the giving of security for money so borrowed by pledging assets or otherwise;

(m) paying, receiving, collecting and remitting money, bullion and securities under any agreement with the Bangladesh Bank as its agent on behalf of the Government, or undertaking and transacting any business which the Bangladesh Bank may from time to time entrust to it;

(n) establishing and discontinuing of branches and agencies;

(o) acquiring, maintaining and transferring of the bank’s residential and business premises;

(p) taking over of the business, including the capital, assets and liabilities of any other bank, with the sanction of the Government;

(q) granting of advances or loans to any other bank for any purpose authorised by the Board;

(r) with the previous permission of the Bangladesh Bank:-

(i) investing of the funds of the bank in any bank incorporated outside Bangladesh, and

(ii) participation in the management and administration of any such bank in which the funds of the bank have been invested; and

(s) generally doing of all such matters and things as may be incidental or subsidiary or conducive to the promotion or advancement of the business or the bank, including foreign exchange business.

(3) Notwithstanding anything contained in clauses (1) and (2), the bank may carry on and transact such other business as the Government or the Bangladesh Bank may direct from time to time.

18[21A. (1) A new bank may, if the Government so directs, take over the business of any bank which has vested in the Government under section 3 of the Enemy Property (Continuance of Emergency Provisions) (Repeal) Act, 1974 (XLV of 1974) or under any other law, hereinafter referred to as the vested bank.

(2) Notwithstanding anything contained in any other law for the time being in force, the business of a vested bank taken over by a new bank on the direction of the Government at any time before the commencement of the Bangladesh Banks (Nationalisation) (Amendment) Ordinance, 1978 (XXXIX of 1978), shall be deemed to have been taken over under this Article.

(3) The undertaking of a vested bank the business of which has been, or is deemed to have been, taken over by a new bank under this Article shall stand transferred to, and vested in, the new bank.

Explanation -The undertaking of a vested bank shall be deemed to include all assets, rights, powers, authorities and privileges and all property, movable and immovable, cash balances, reserve funds, investments and all other rights and interests in, or arising out of, such property as were immediately before the taking over of the vested bank in the ownership, possession, power or control of the vested bank within the territory of Bangladesh and all books of accounts, registers, records and all other documents of whatever nature relating thereto and shall also be deemed to include all borrowings, liabilities and obligations of whatever kind then subsisting of the vested bank in relation to its undertaking within the territory of Bangladesh.]

  1. (1) A new bank shall not transact the following kinds of business, namely:-

(a) it shall not make any advance or loan or grant any facility in contravention of any law in force or any instruction of the Bangladesh Bank;

(b) it shall not make any unsecured advance or loan to any Director or to any concern in which a Director is interested:

Provided that no facility to any member of the staff shall be denied merely because he is also a Director.

(2) Notwithstanding anything contained in clause (1), the bank is authorised to grant advances or loans or to make exgratia payments, with the prior approval of the Government, to its officers and staff for the purpose of providing amenities and facilities for their betterment.

  1. (1) Every new bank may, subject to 19[other provisions of this Article and] any regulation made in this behalf, appoint or employ such persons as it considers necessary for the efficient performance of its functions on such terms and conditions as it may determine.

(2) Every officer or other employee of an existing bank shall become, on the commencement of this Order, an officer or other employee, as the case may be of the new bank concerned and shall 20[, unless altered by the Government in the interest of equity and uniformity,] hold his office or service in that bank on the same terms and conditions and with the same rights and privileges as to provident fund, gratuity, pension and other matters as were enjoyed by them immediately before such commencement and shall continue to do so unless and until his employment in the new bank is terminated or until his remuneration or terms and conditions are duly altered by the new bank :

Provided that an officer or other employee may, within such time as may be specified by the new bank, exercise his option not to continue in the service of the new bank.

(3) Notwithstanding anything contained in any terms and conditions of service or in any award, settlement or agreement for the time being in force, every new bank may, with the prior approval of the Government, alter the remuneration (whether by way of reduction or otherwise) and other terms and conditions of service of any officer or other employee of the bank, and if such alteration is not acceptable to an officer or other employee, the bank may terminate his employment by giving him compensation equivalent to three months’ remuneration in case of a permanent officer or employee and one months’ remuneration in case of temporary officer or employee.

Explanation.- The compensation to an officer or other employee under clause (3) shall be in addition to any pension, gratuity or other benefit to which the officer or employee may be entitled under the terms and conditions of his service.

(4) If any question arises as to whether any person was an officer or other employee of an existing bank or not immediately before commencement of this Order, the question shall be referred to the Government whose decision shall be final and binding on the parties.

(5) The transfer of service of any officer or other employee from an existing bank to a new bank shall not entitle any such officer or other employee to any compensation, other than the compensation mentioned in clause (3), and no such claim shall be entertained by any Court, tribunal or other authority.

21[(6) Notwithstanding anything contained in this Article, the Government may appoint the General Manager of a new bank on such terms and conditions as it may determine and may transfer a General Manager of a new bank as the General Manager of any other new bank.]

  1. (1) The accounts of every new bank shall be audited by not less than two auditors, being chartered accountants within the meaning of the 22[Bangladesh Chartered Accountants Order, 1973 (P.O. No. 2 of 1973)], who shall be appointed by the Government for a term not exceeding three years on such remuneration as it may fix.

(2) Notwithstanding anything contained in clause (1), the Bangladesh Bank may appoint such auditor as it thinks fit to examine and report upon the accounts of any new bank.

(3) Every auditor shall be supplied with a copy of the annual balance-sheet and statement of profit and loss and he shall examine it with the accounts and vouchers relating thereto, and shall have a list delivered to him of all books kept by the bank, and shall at all reasonable times have access to the books, accounts and other documents of the bank, and may employ accountants or other persons to assist him in the investigation of such accounts, and may, in relation to such accounts, examine any Director or officer of the bank.

(4) The auditors shall report to the 23[Board] upon the annual balance-sheet and accounts, and in their report they shall state whether, in their opinion, in balance-sheet is a full and fair balance-sheet containing the prescribed particulars and properly drawn up so as to exhibit a true and correct view of the state of the bank’s affairs, and in case they have called for any explanation or information from the Board, whether it has been given and whether it is satisfactory.

24[(5) The bank shall, within 90 days after the end of every financial year, furnish to the Government and the Bangladesh Bank a copy of the auditors report along with a copy of the audited balance sheet and a copy of profit and loss account for the year and a report on the working of the bank during the year:

Provided that the Bangladesh Bank may in special circumstances extend the said period of 90 days for furnishing of such report by a further period not exceeding 90 days.]

25[(6) The audited balance sheets and the profit and loss accounts received by the Government under clause (5) shall be published in official Gazette and shall be laid before the Parliament.]

  1. After making provision for bad and doubtful debts, depreciation of assets and such other matter as may be prescribed, every new bank may, out of its net profits, establish a reserve fund and any surplus remaining thereafter shall be paid to the Government.
  2. Any reference to any existing bank in any law, other than this Order, or in any contract or other instrument shall, in so far as it relates to the undertaking which has been transferred by Article 6, be construed as a reference to the corresponding new bank.
  3. No provision of law relating to the winding up of companies including banking companies shall apply to any new bank, and the new bank shall not be wound up save by order of the Government and in such manner as it may direct.