The court directed Bangladesh Bank to submit its investigation report within 15 days and instructed the central bank governor to dispose of a petitioner’s application seeking action against Shawkat within 30 days.
TBS Report
15 October, 2026, 06:45 pm
Last modified: 15 October, 2026, 06:48 pm
The High Court has issued a rule questioning authorities' inaction against former Eastern Bank chairman Shawkat Ali Chowdhury for allegedly controlling more than 20% of the bank's shares directly and through proxy entities, in violation of the Bank Company Act.
The court directed Bangladesh Bank to submit its investigation report within 15 days and instructed the central bank governor to dispose of a petitioner's application seeking action against Shawkat within 30 days.
A High Court bench of Justice Shawkat Ali Chowdhury and Justice Abdur Rahman passed the order today (15 October). Advocates Mohammad Ali, Ishrat Hasan and Biplob Kumar Das represented the petitioner.
Kamrul Islam, a Dhaka Bar Association member and EBL small shareholder, filed the writ petition in the public interest to protect bank depositors and stock market investors.
Section 14Ka(1) of the Bank Company Act, 1991, prohibits any individual, family or institution from holding more than 10% of a bank's shares.
However, Shawkat and his family allegedly control 21.11% of EBL's shares, 9.99% directly and 11.12% through proxy entities, equivalent to around 336.7 million shares, the petition said. Bangladesh Bank's investigation reportedly confirmed control of 20.48%, but the regulator has yet to take effective action.
The investigation found that Shawkat allegedly used Naimul Haque and his wife Salma Shirin, employees of his family-owned SN Corporation, and his sister-in-law Anika Tahjib as proxy shareholders.
The shares were allegedly held through Arusha and Company, with 9.98%, and Anika Shares and Securities, with 1.14%. Both reportedly had paid-up capital of just Tk1 lakh. Shawkat's sister-in-law and daughter were connected to former shareholders of Arusha, while official documents listed the same address for Shawkat and his sister-in-law at 28 Sarson Road, Chattogram, the petition said.
Although Arusha and Company bought no shares after 2009, bonus shares increased its holdings to more than 135.4 million shares, valued at around Tk330.50 crore. The company has received Tk243.23 crore in cash dividends, according to the petition.
Shawkat allegedly approved the dividends while serving as chairman and director, then transferred Tk9.90 crore to his personal account and Tk27.25 crore to SN Corporation, allegedly disguising the payments as advances for land purchases.
The petition further alleges that Shawkat and his associates are rapidly selling the proxy-held shares to secure an exit before regulatory action or forfeiture.
Citing Bangladesh Bank's corporate governance guidelines, the petition said people and family members implicated in serious financial irregularities or fraud may be barred from financial institutions for at least three years.