Islami Bank Bangladesh PLC has sought Tk 10,000 crore in liquidity support from Bangladesh Bank amid a new instability that has triggered large deposit withdrawals, bank officials said.

A senior official of the Islamic bank said that the lender had requested emergency liquidity assistance from the central bank after its reserve position had come under pressure following recent developments surrounding the appointment of former Bangladesh Bank deputy governor Khurshid Alam as the bank’s chairman.

According to the official, depositors have withdrawn more than Tk 4,000 crore from the bank in recent weeks, leading to a significant decline in its cash position and resulting in a severe decline in CRR maintainance.

Under banking regulations, banks are required to maintain a minimum level of cash reserves with the central bank.

The official said that Islami Bank’s balance in its principal account with Bangladesh Bank had declined sharply to Tk 2,600 crore from Tk 7,015 crore, prompting the bank to seek Tk 10,000 crore in liquidity support.

The bank had previously faced severe liquidity stress after the S Alam Group allegedly borrowed large sums from the institution through various entities during the Awami League regime.

However, following the political transition in August 2024, the bank had shown signs of recovery.

Within months, it managed to overcome its reserve shortfall and rebuild its balance with the central bank.

The latest liquidity pressure emerged after changes in the bank’s leadership.

On May 24, chairman Professor M Zubaidur Rahman and managing director Omar Faruq resigned.

Later the same day, Khurshid Alam was appointed the chairman of the bank.

Since then, a group of customers has been protesting against the appointment under different banners.