Government panel clears Yunus of mishandling of foreign fund

The report comes nearly two months after Yunus, a celebrated pioneer of micro-finance, was forced out on March 2 from the Grameen Bank which he founded nearly three decades ago.

Bangladesh Finance Minister AMA Muhith today said the committee appointed by the government to investigate Grameen Bank's operations has found no evidence of financial irregularities.

"The (government) review committee said it did not find any irregularity in handling of the foreign fund," he told newsmen as the committee submitted its 50-page report. He said the committee also found that the effective interest rate of the micro financier -- 20 percent on basis loans -- was the lowest compared to other micro lending agency of the country.

"The committee has given its report within its purview and now the government will take the next step," Muhith said. The panel also found no truth in allegations that the Bank charged excessive interest rates on loans to the poor.

Yunus' dismissal was upheld by the High Court and Supreme Court -- on the grounds that he had overstayed in his position and ignored requests to step down.

Local media quoted officials and experts as saying that the government's decision to fire Yunus as the bank's managing director is unlikely to be changed as he had overstayed the official retirement age for bank chiefs in Bangladesh of 60 years.

Head of the review committee Professor AKM Monowar Uddin Ahmed told a news agency that they had recommended changes to make Grameen Bank more efficient and accountable.

"We have said that Grameen Bank's huge micro-finance operations and social businesses must be reformed. The government must think about it," he said.

Despite a clean chit by the Norwegian government clearing him of the allegations of fund mishandling, the government in January this year formed a five-member "review committee" to examine Grameen Bank transactions. But he was fired from his position as the Grameen Bank's managing director last month under a Bangladesh Bank decision ahead of the submission of the report by the investigators.

Grameen Bank still awaits a final apex court decision as Yunus's lawyers filed a petition with the Appellate Division of the Supreme Court for a review of its own verdict in the case.