Dhaka, Jan 08 (V7N) — The ownership structure and governance of Nobel Prize-winning microfinance institution Grameen Bank are set for significant reform, with the government planning to reduce its stake in the institution from 25% to 5%.

The proposed changes are part of a draft ordinance published on the website of the Finance Ministry's Financial Institutions Division. The ordinance also includes amendments to the 2013 Grameen Bank Act, aiming to increase the bank's autonomy and reduce government influence.

Key changes in the draft ordinance include reducing the number of government-appointed directors from three to one and removing the government's authority to appoint the bank's chairman. Instead, a 12-member board will elect the chairman, giving greater control to microfinance borrowers and stakeholders.

The move is expected to empower Grameen Bank's borrowers and enhance its operational independence, addressing longstanding concerns about government interference.

Grameen Bank has been a focal point of controversy during Sheikh Hasina's 15-year rule, which ended after her resignation on August 5, 2023, amid mass protests. The new ordinance signals a shift towards restoring the institution's autonomy and ensuring borrower representation in decision-making.

Founded by Professor Muhammad Yunus, who also served as the chief advisor to the interim government of Bangladesh, Grameen Bank pioneered microfinance globally. However, Yunus resigned as managing director in 2011 after being compelled to step down by the Awami League government, citing his age as the reason.

If implemented, the proposed changes could redefine the governance of Grameen Bank and solidify its role as a borrower-driven institution.

END/MSS/AJ