S Alam’s takeover of Islami Bank Bangladesh PLC is a well-known tale. Bank robbery is a very old profession and still occurs all over the world. While there have been countless incidents of bank robbery, actual seizing of bank ownership is quite rare. Earlier, in 1999, Akhtaruzzaman Chowdhury Babu had attempted to take control of United Commercial Bank PLC at gunpoint. Perhaps S Alam learned from the failure of his uncle. And so, by using state intelligence agencies, he was able to very easily take control of six banks one after another.
There have been instances in other countries where ownership was seized by buying shares from the market or where funds were embezzled from one’s own bank. Now let's take a lot at what those countries did, and what we are doing.
Moldova’s “Theft of the Century”
One of Europe’s poorest countries, Moldova was once part of the Soviet Union. The country’s most important state-owned bank, Banca de Economii, was the successor to the Soviet-era savings bank. Even in 2012, the Moldovan government still owned 56.13 per cent of the bank’s shares. After that, the government began selling additional shares.
By 2013, the government’s stake had fallen to 33.38 per cent. From then on, control of the bank gradually began shifting to the hands of private groups. The key figure behind that private group was Ilan Shor. Born in Israel in 1987, he later moved to Moldova with his family. After his father’s death, he took control of the family business at the age of 18 and quickly became influential. He also gained international attention after marrying the popular Russian pop singer Jasmine.
In 2022, Prothom Alo published a report titled “Nasty November” about Islami Bank Bangladesh PLC. Between 1 and 17 November 1 and 17 that year, around 70 billion taka was withdrawn, under various names and anonymous accounts, from three banks including Islami Bank.
The Moldovan incident was another story of a nasty November. Between 24 and 26 November 2014, within just three days, Ilan Shor withdrew and laundered nearly $1 billion from three Moldovan banks in the name of loans. This amount was equal to 8 per cent of the country’s total GDP. Among the three banks, Banca de Economii was state-owned, while close associates of Ilan Shor owned Unibank, and Ilan Shor himself became the owner of Banca Sociala in 2013.
The entire incident took place just one week before Moldova’s national election. After the scandal became public, the government provided $870 million in support to save the three banks and appointed special administrators. As a small and poor country, Moldova suffered heavily from this enormous expenditure: public debt and inflation increased, and the value of the local currency fell sharply.
On 3 May 2015, thousands of people took to the streets in protest in Chisinau, the capital of Moldova. Protesters alleged that the government had known about the entire affair but failed to act in time, and that politically influential figures were involved behind the scenes. Even today, the incident is known in Moldova as “The Theft of the Century.”
Later, an investigation by the American firm Kroll found that the ownership and boards of directors of the three banks had been altered in such a way that a single group—led by Ilan Shor—was able to gain control over all three institutions. At the time the banks were gradually coming under Shor’s control, Moldova’s prime minister was Vlad Filat. Later, Ilan Shor himself stated that he had bribed Filat in exchange for political protection. Filat was arrested from parliament in 2015 and sentenced to nine years in prison.
In 2017, Ilan Shor was initially sentenced to seven and a half years in prison. In 2019, he fled the country. In 2023, Moldova’s appeals court increased his sentence to 15 years. He remains a fugitive and is reportedly under Russian protection.
What is bank resolution?
When a bank in a country falls into trouble or faces the risk of failure, governments today usually try to resolve the crisis not through ordinary bankruptcy proceedings, but through special legal mechanisms. The main objective is to protect depositors and keep essential banking services running. This process is known as “bank resolution.” Moldova adopted this policy in its effort to save the banks.
The concept began in the United States in 1933, in response to the Great Depression. In 1929, the US stock market crashed. The economy then rapidly fell into recession, businesses declined, people’s incomes dropped, and unemployment rose sharply. The banking sector suffered the greatest shock from the crisis. People lost confidence in banks and rushed to withdraw their money all at once. But banks did not have enough cash on hand to meet the demand. As a result, banks began collapsing one after another.
On 4 March 1933, Franklin D Roosevelt assumed office as president of the United States. Immediately after taking power, he launched major reforms in the economy and banking sector. First, he declared a temporary nationwide closure of banks, which became known as the “Bank Holiday.” Then, on 9 March 1933, the Emergency Banking Act was passed. Under this law, comparatively healthier banks were gradually reopened. Later, on 16 June, the Banking Act of 1933 was enacted.
Through this law, the functions of commercial banks and investment banks were separated. The Federal Deposit Insurance Corporation (FDIC) was also established. Its role was to insure depositors’ money up to a certain limit and manage the resolution of failed banks. These two laws helped save the US banking sector.
The concept of bank resolution became internationalised after the 2008 Financial Crisis. At that time, fresh thinking emerged on how to handle the collapse of banks and financial institutions. It became clear that many countries lacked mechanisms to deal with such crises. As a result, in 2009, the G20 countries established the Financial Stability Board (FSB).
The FSB’s role was to monitor risks in the global financial system and coordinate among regulators in different countries.
Then, in October 2011, the FSB adopted an international framework for handling banks and financial institutions. It was called “Key Attributes of Effective Resolution Regimes for Financial Institutions.” In November 2011, leaders of the world’s major economies endorsed this framework at the 2011 G20 Cannes Summit held in Cannes. This is essentially the core story behind bank resolution.
Bank resolution in Bangladesh
In Bangladesh, the first comprehensive bank resolution framework was introduced through the Bank Resolution Ordinance issued on 9 May 2025, while the interim government was in power. Through this ordinance, Bangladesh Bank was granted special powers in dealing with troubled scheduled banks. These powers include appointing temporary administrators, merging banks, creating bridge banks, transferring assets and liabilities to other institutions, and, if necessary, temporarily taking control of banks.
Under this ordinance, five Islamic banks that were on the verge of bankruptcy are now being merged. Given the condition those banks had reached, there appeared to be no immediate alternative.
However, controversy began after the Bangladesh Nationalist Party (BNP) government came to power and converted the ordinance into law. The controversy centers on several clauses added during its passage in the national parliament. In particular, there has been strong criticism over provisions allowing former bank owners the possibility of regaining ownership in the future.
On 11 May, leaders of the Bangladesh Association of Banks (BAB), the organisation representing bank entrepreneurs, also met with Mostakur Rahman, the governor of Bangladesh Bank, to express their concerns.
Section 18(a) of the newly passed law states that individuals who held shares in a bank before it came under resolution may later apply to Bangladesh Bank to regain ownership of that bank’s shares, assets, and liabilities. Bangladesh Bank may also extend this opportunity to any other suitable person if it chooses. However, applicants must make several commitments.
They must repay all funds provided by the government or Bangladesh Bank. They must inject new capital into the bank and cover any capital shortfall. They must also settle the legitimate claims of previous depositors, domestic and foreign creditors, and third parties. In addition, they must pay taxes and any other dues owed to the government.
If the application is approved, the applicant must deposit 7.5 per cent of the funds provided by the government or Bangladesh Bank through a pay order within three months. The remaining 92.5 per cent must be repaid within two years of the transfer of shares, along with 10 per cent simple interest.
Former owners are not brought back
Moldova did not allow Ilan Shor to return. But perhaps the best example regarding former bank owners has been set by Ukraine.
Ukraine’s largest bank is PrivatBank, which was at the center of the country’s financial system. In 2016, the Ukrainian government was forced to nationalise the bank after discovering that nearly $2 billion had been siphoned out of it. The bank was owned by the influential Ukrainian oligarch Ihor Kolomoisky. Investigations showed that a large portion of the loans issued by the bank were fraudulent.
As expected, Kolomoisky denied all allegations and went to court in an attempt to regain the bank. Initially, a Ukrainian court declared the nationalisation of PrivatBank illegal. But after the government appealed, the nationalisation was upheld. Then, in 2020, Ukraine’s parliament passed a new banking law. The new law prevented former owners from regaining control of state-rescued banks through the courts.
The International Monetary Fund (IMF) supported the law.
The core principle of the law was that if the central bank declared a bank insolvent or rescued it through state intervention, the bank could not be returned to its previous owners even if a court later found flaws in the decision. Former owners could, however, seek financial compensation.
Kolomoisky also challenged this law in court. But in February 2025, Ukraine’s Supreme Court rejected his appeal and ruled that PrivatBank could not be returned to its former owners and that the nationalization would remain in force. Officially, this is known as Law No. 590. But it is now commonly called the “Anti-Kolomoisky Law.”
Meanwhile, the Ukrainian government and PrivatBank took another step. In 2017, the bank filed a lawsuit in the High Court of Justice in London seeking global asset freezes in order to recover funds allegedly laundered by the former owners. After eight years of litigation, the London High Court ruled in favor of the bank in July 2025. As a result, Kolomoisky’s efforts to regain the bank came to a permanent end.
Ukraine created the “Anti-Kolomoisky Law” to block former bank owners from returning. Keeping this example in mind, the Bangladeshi government should also amend the Bank Resolution Act again so that former owners cannot return. Then the law could also be called the “Anti–S Alam Law.”
* Shawkat Hossain is the Head of Online at Prothom Alo.
* The opinions expressed are the author’s own.
* This article appeared in Bangla in print and online and has been translated here by Ayesha Kabir