The Banking sector in Bangladesh in one of the most prominent and noteworthy sector, which flourishes the skills and expertise of a Banking lawyer in Bangladesh not solely from the legal perspective, but collaborates with other diversified sectors as well. Banking Lawyers in Bangladesh engages in banking and investment sector in Bangladesh are mainly responsible for supervising whether all functions, transactions, and decisions taken are compatible with the law and also govern the activities before and after lending or borrowing money.
LAWS & RULES RELATING TO BANKING IN BANGLADESH | BANKING LAWYER IN BANGLADESH
In Bangladesh, the commonly used Acts and Rules followed and used by the lawyers are as follows:
REQUIRED SKILLS FOR A BANKING LAWYER
In our country, the requirements set out by the Banks and Financial Institutions for lawyers are commonly the skill for scrutinizing property documents, skill for drafting all sorts of security documents, clear understanding and proficiency of the banking laws, global and commercial issues and good communication skill.
Accordingly, the Banks and Financial Institutions appoint lawyers to advise on the banking commercial transaction ensuring the legal boundaries.
FUNCTIONS OF THE LAWYERS
n our country, one significant function of the lawyers of Banks and Financial Institutions is connected to lending and borrowing money. In recent years, the Banks are more eager to lend money both to the companies and the individuals. In the process, the Banks usually keep immovable properties, stocks and/or other assets (both fixed and floating assets) as security to recover the money in case of any default or fraud made by the borrower.
Here, the lawyers’ duty is to scrutinize all documents related to that property and obtain the rightful ownership of the owner(s) over the same. Once the inspection is completed, the Banks and Financial Institutions proceed to lend money through signing facility offer letters which contains all the details of lending (i.e. amount of money, duration and limit of the facility/facilities, interest rates, security requirements etc.) signed by both the borrower(s) and the bank officials.
Afterward, the lawyers prepare different security documents against the money to be given to the borrowers and these security documents include Deed of Mortgage and corresponding Deed of Power of Attorney to sell the mortgaged property, Deed of Hypothecation, Deed of Power of Attorney to sell the hypothecated assets, Memorandum of Deposit of Title Deed(s), Deed of Undertaking etc. Also, in a case of real properties, the relevant Deeds need to be registered to the concerned sub-registry office in the way as described in the Transfer of Property Act, 1882.
On the other hand, in the cases of creating a charge of the assets of the companies against loan facility, all the documents have to be submitted to the Office of the Registrar of Joint Stock Companies and Firms (RJSC) and certificates for the same have to be collected.
Alternatively, when stocks are kept as security for the loan facility, the lawyers are responsible for drafting and executing a set of security documents as per the guideline.
After all the process above, the lawyers usually issue a document declaring the fulfillment of obligatory security measures against which the loan amount is disbursed to the borrower.
It should be noted that the Banks or the Financial Institutions can modify the loan facility from time to time requiring the client to perform further measures where the lawyers arrange additional services for both the Banks and the Borrowers.
One common banking practice in Bangladesh is Islamic finance where both the lenders and the investors follow the Shariah Law, which restricts the collection and payment of interest on an investment facility. Here, the Islamic Finance lawyers ensure that all the finance transactions are structured in according to the Shariah Law.
DAFAULT OF LOAN/INVESTMENT FACILITY
In Bangladesh, around 24% loan facility and investment facility go into default and in this regard, a huge number of lawyers provide assistance to the Banks and Financial Institutions to recover their money to the highest extent from the defaulter with the help of the Courts.
As a result, the need for banking lawyers in our country is increasing with the growing economy for the assistance of the Banks and Financial Institutions in kind of financial transactions and investments. Like advanced countries, people in our country are accordingly developing the habit of consulting a lawyer before going to any kind of business transaction with any financial institution in Bangladesh.