Yunus Centre protests the Statement of Finance Minister at National Parliament regarding the Grameen Bank and Professor Yunus

• Responses to Media
• 03rd July 2013
• YC

On 26 June 2013, Dr. Abul Maal Abdul Muhith made a statement about Grameen Bank and Professor Yunus in the National Parliament. The people of the country were shocked by the statement of the Honorable Finance Minister. No one expected this kind of false statement against a respected person from the country’s Finance Minister in the Parliament.

The following are responses to the Finance Minister’s statement:

1.0 Honorable Finance Minister’s statement: All the Grameen social businesses are owned by Yunus
Response: The statement is completely false. All the social businesses carrying the Grameen name are not owned by Dr. Yunus. Professor Yunus has repeatedly said and at various times through newspapers and the media that he does not own
a single share in any businesses. If Honorable Minister is able to show evidence of any instance of Professor Yunus owning a single or more personal shares in any company, there would be no reason to protest the Finance Minister’s statement. But if he is unable to produce such evidence, then the Finance Minister should apologize for making false assertion against a respected person.

2.0 Honorable Finance Minister’s statement: Dr. Yunus has taken dividends amounting to some thousand crores taka from Grameen Phone.
Response: The Finance Minister should explain to the Parliament, and so to the people of the country, how Professor Yunus could receive a few thousand crore takas in dividends from an institution where he does not own any shares nor even shares bought from the stock market.

3.0 Honorable Finance Minister’s statement: Three brothers of Professor Yunus were the directors of the companies. The rest, who do not take any profits, were hired by him.
Response: Only two of Professor Yunus’ brothers live in Dhaka. They are Professor Muhammad Ibrahim and Mr Muhammad Jahangir. Muhammad Jahangir is not involved on the board of any company. Professor Ibrahim is a member of board of directors of four Grameen named companies because of his knowledge and experience. All four of these institutions are non-profit voluntary institutions where there is no scope for the board of directors to receive any financial benefit. None of Professor Yunus’ other brothers are involved in any board of directors of any Grameen-named institution.

4.0 Honorable Finance Minister’s statement: Mr. Yunus couldn’t give time, board meetings could not take place, decisions could not be made.
Response: The same number of board meetings that took place in Grameen Bank each year during the time of Professor Yunus, has taken place every year since the departure of Professor Yunus. The same amount of time that was spent on the board meetings before his departure, the very same amount of time is spent on the board meetings now.

5.0 Honorable Finance Minister’s statement: Mr. Yunus was Managing Director illegally. Mr. Yunus’s law states that he should retire at the age of 60 years. Board said that he should be Managing Director for an undefined period of time. Bangladesh Bank reminded him every year during their audit of GB, that he could no longer remain as MD as he is 60 years old.
Response: This statement is completely false. Before he turned 60 in 1999, during the 52nd board meeting of Grameen Bank that took place in July, Professor Yunus voluntarily informed the board of his retirement as Managing Director. During that meeting, and in accordance with Section 14 of Grameen Bank Ordinance, the board unanimously took the decision that “Until such date that the board decides otherwise, Professor Muhammad Yunus will remain as the Managing Director.”

In an inspection audit report of Bangladesh Bank in 2000 (based on audit of the year ending December 1999) an objection was raised that permission had not been sought GB for Professor Yunus’ appointment as Managing Director. In response to this objection, Grameen Bank sent a response to Bangladesh Bank on June 20, 2001 that approval had in fact been given in 1990 by the Bangladesh Bank on the Managing Director’s appointment. In 15 January 2002, a joint meeting took place between three representatives from Bangladesh Bank and three representatives from Grameen Bank on this issue. On the basis of the decisions of this joint meeting, Grameen Bank sent another follow up report, together with the relevant documents about the appointment of Managing Director, to the Bangladesh Bank. After reviewing the above report and documents, Bangladesh Bank considered the issue of appointment of Grameen Bank’s Managing Director as having been resolved. It should be mentioned that Bangladesh Bank inspects Grameen Bank every year but no further objection or question was raised about the Managing Director having crossed 60 years of age. Even on this issue, the Honorable Finance Minister’s statement is incorrect. It is clear from the minutes of the joint meeting that the Bangladesh Bank had accepted Professor Yunus continuing his responsibilities as Managing Director of Grameen Bank, even after he had crossed the age of 60. Thus, there is no question of Professor Yunus remaining as Managing Director of Grameen Bank illegally.

6.0 Honorable Finance Minister’s Statement: When Dr Yunus was Managing Director of Grameen Bank, his contribution through microcredit projects to the banking sector of the country was worth sixteen thousand crore taka. This amount has increased to thirty three thousand crore taka until last December.
Response: Does the Honorable Finance Minister mean to say that after Dr Yunus left the post of Managing Director, huge activities have been created in the microcredit sector of the country? It should not be difficult for anyone to understand that microfinance’s contribution to the banking sector would not be affected by Professor Yunus remaining or not remaining as Managing Director of GB. When Dr Yunus retired from Grameen Bank (April 2011), Grameen Bank’s loans outstanding amounted to 7,073 crore takas. Currently ( May 2013 ), Grameen Bank’s loans outstanding total 8,300 crore takas. This growth is part of Grameen Bank’s regular activity and operation.

7.0 Honorable Finance Minister’s statement: I think Grameen Bank has 22,000 branches.
Response: This information is incorrect. Till May, 2013 the number of GB branches is 2,567. The number is only 11.6% of the figure given by him.

8.0: Honorable Finance Minister’s Statement: I called Dr Yunus and told him to resign from the MD post. I will make you an Emeritus Board Member. Dr. Yunus said he would think about it. After that, I appointed a new chairman for Grameen Bank. Then Dr. Yunus said that if he leaves the post of MD, the bank will shut down.
Response: Dr. Yunus had tried to step down from Grameen Bank many times on several occasions. Each time it created a panicky situation among the Grameen Bank employees and borrowers. For this reason and in order to bring a smooth transition of responsibility, he met with the Finance Minster several times and sought his cooperation on this matter. On March 15, 2010, Dr. Yunus gave a hand-written letter to the Finance Minister stating his intentions (copy of letter attached). He took the letter to the Finance Minister’s home himself and read out the letter to him. Honorable Finance Minister said that he agreed with the contents of the letter and would proceed in the way proposed. Later when the Finance Minister had not taken any initiative on this issue, Professor Yunus called him by telephone and reminded him about this issue. The Finance Minister said he remembered and would proceed in the way discussed. But he did not proceed in that way, instead suddenly demanded Professor Yunus’ resignation.

9.0 Honorable Finance Minister Statement: Grameen Telecom took loan from an institution Soros with a guarantee from the board of Grameen Bank
Response: This is a false statement. Grameen Bank did not provide any guarantee from Grameen Telecom's loan from Soros.

10.0 Honorable Finance Minister’s Statement: Grameen Bank faced huge damages in the 1998 floods. Then government assisted by giving 400 crore takas.
Response: This is a false statement. Government did not provide assistance to Grameen Bank for damages to Grameen Bank during the 1998 floods. Rather, Grameen Bank raised 200 crore taka by selling bonds to a commercial bank at 10% interest for a period of three years. The law required that the government provide a guarantee for this purpose. Grameen Bank repaid the 200 crores in due time.

11.0 Grameen Danone
Response : Honorable Finance Minister does not have a clear understanding of social business as a result of which he has made statements about social business that do not make sense. He has mixed up “Social Business” with “Social Investment”. Explanations about what social business is have been given before to protest what he said about social business in the past.
He has said that Grameen Danone has started its business as a non-profit company and later turned into a profit oriented company. This information is incorrect. Grameen Danone has been registered as a profit-oriented company since the beginning and remains the same. There has been no change in its legal structure. All the Social Business institutions are profit oriented companies. The only characteristic is that the owners don’t receive any dividends, they only receive the investment amount back.

12.0 Grameen Phone:
Honorable Minister Statement: Dr. Yunus claims that Grameen Bank does not have any ownership relationship with Grameen Phone. This is false, false, false.
Response: Dr. Yunus maintains that Grameen Bank does not have any ownership relationship with Grameen Phone – this is true, true, true! Why the need for a war of words on this issue?

Government can obtain the list of names of the shareholders of Grameen Phone from the appropriate government agency and resolve this issue immediately. It is not a secret issue.

Grameen Bank not only does not have any ownership relationship with Grameen Phone, it does not have any ownership relationship with any company carrying the Grameen name. A chaotic situation has unnecessarily been created by summoning all kinds of documents of all Grameen-named companies, to establish that there is an ownership relationship with Grameen Bank.

It has been repeated many times that that these institutions are all registered with the relevant government agency as independent companies. Most of the institutions do not have any owners. How could Grameen Bank be an owner of an institution which does not have any ownership structure? These issues have been explained in detail through booklets published before by the Yunus Centre. These issues have been explained to the government several times.

The names and addresses of the owners of those Grameen institutions that do have owners, are available with the relevant government departments. It is not necessary to check bags and bags of documents from last 25 years of 50 organizations to establish the ownership issue.

The letter written by Prof. Muhammad Yunus to Honorable Finance Minister Dr. Abul Maal Abdul Muhith (25th March, 2010)