The New Nation - Internet Edition

Staff Reporter

The Government has decided to drop Rupali Bank from its privatisation list as its bidder Saudi Prince Bandar-Bin-Mohammad-Bin-Abdul-Rahman-Al-Saudi failed to sign a purchase deal within the scheduled time.

An Advisory Committee meeting for Economic Affairs, Government of Bangladesh has taken the decision yesterday, which was presided over by the Finance Adviser Mirza Azizul Islam.

After the meeting, Finance Adviser said, since the Saudi Prince did not agree to purchase Rupali Bank, the Government decided to drop its name from the list of privatisation.

"Now, orders have been issued to send back all the files and documents related to Rupali Bank sale to the Finance Ministry," he added.

According to him, normal operation of Rupali Bank was hampered because of the privatisation move.

Official from the Finance Ministry said the Committee asked the Privatisation Commission to cancel the tender floated to sell out Rupali Bank as part of the privatisation move.

Participating in the tender, Saudi Prince Bandar-Bin-Mohammad-Bin-Abdul Rahman Al-Saudi won the bid in 2006

and proposed to invest US$500 million in the state-run Rupali Bank, of which US$330 million for buying the bank's 67 per cent shares and the rest for modernising it.

But after the 1/11 changeover of the country's political situation, the Saudi Prince was delaying to strike the purchase deal with the government.

Finally, the Privatisation Commission served a legal notice to the Saudi Prince in December 2007, asking him to deposit US$458 million within December 26, 2007 as per its tender participation rules for taking over Rupali Bank.

But the Prince did not reply to the Commission. The Commission, in a letter, had earlier informed the Chief Adviser that the Prince, after two weeks of the notice, would be liable to forfeit US$100,000 in security money paid to it.

The government had earlier decided to privatise Rupali Bank as part of its financial reforms and banking sector modernisation.