Bangladesh Bank has dissolved the board of directors of Al-Arafah Islami Bank PLC and reconstituted it with representatives of the bank's founding sponsors.
The move marks a decisive shift in governance, returning control to the institution's original owners after a period of central bank oversight.
The decision by the central bank signals a potential stabilization phase for the lender, which has faced significant regulatory scrutiny in recent years.
By restoring the founding sponsors to the board, authorities appear to be testing whether original ownership can drive the necessary operational and financial reforms without continued direct administrative intervention.
Al-Arafah Islami Bank has been a focal point of Bangladesh's banking sector cleanup efforts.
The lender previously entered into a refinance agreement with Bangladesh Bank under the BB Cluster Financing Scheme, a program designed to channel liquidity to specific sectors while managing systemic risk.