Ideas to Action:

Independent research for global prosperity


David Roodman's Microfinance Open Book Blog


The news of Yunus's formal resignation is in a sense not news: the highest court in the land already ruled that he had to go. But it is also profoundly sad moment, so much so that I did not want to sully this transcendent moment with my perishable thoughts.

But you must be wondering: what next?

I wrote back in March about issues facing the Grameen Bank in the post-Yunus era. Those issues haven't gone away. But the situation has, to external appearances, become more grave.

The obvious successor would be Dipal Barua, the most recently departed Deputy Managing Director. Barua was born in Jobra, where Yunus made his first loans, and worked under Yunus all those years until early 2010. He was central to the Grameen II overhaul. He founded Grameen Shakti, a solar company. The split between Yunus and Barua was evidently bitter, and possibly Barua secretly aided the government in ousting Yunus. He knows where the skeletons are. On the other hand, recently released old letters from another departed deputy, Muzammel Huq, show that in the late 1990s at least, he viewed Barua with scorn; and Huq is now the chairman. So I suppose Huq is the other obvious candidate; and going by Mohsin Rashid's legal arguments, it may be Huq who did more to guide the investigative committee.

Of course, we can't assume that the government would be so rational as to appoint someone with years of experience at the Grameen Bank, someone who could bring a mix of continuity, managerial competence, and fresh thinking, thus at least a prayer of saving the Bank as an independent institution. Rumors are flying that Hasina will appoint her sister or her son. Whether or not accurate, such rumors lower one's expectations.

Whoever is picked will have far less independence than Yunus. The government appears to be moving quickly to amend the law that governs the Grameen Bank, to gain more control. Not surprisingly, the government appears intent on reconstituting the board, so that elected members no longer hold the majority. Those nine women are now the main barrier to government control of the Grameen Bank. I have heard that the government has been pressuring some of them, offering them, shall we say, both carrots and sticks to cajole allegiance. If the women continue to resist, then the government will find it easier to do an end run around them by pushing a new Grameen Bank law through parliament, where it does have a majority.

After calling for "tough agitation if Dr Muhammad Yunus is not made chairman," Mohammad Sagirur Rashid Chowdhury, a Grameen Bank employee and spokesperson for its employees' union, was abducted, tortured, and threatened with death if the protests were carried out. Before releasing him at Dhaka University, the perpetrators told him to remain silent about what they had done to him. He did not. They did not leave calling cards, but they reportedly did not take his watch or wallet, indicating that they were professionals. Four days later, Human Rights Watch documented "cases of extrajudicial killings, 'disappearances,' and torture that have taken place in and around Dhaka, after the current Awami League government came to power in January 2009." The force blamed for these atrocities is the government's Rapid Action Battalion. The Awami League, of course, is led by Prime Minister Sheikh Hasina.

The saddest aspect of Yunus's departure is that it says much more about the government of Bangladesh than about microfinance and its leading light.

Related Topics:


CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.