Friends and colleagues call him a “doyen of banking”. M Matiul Islam is an endearing name among his peers. He made a clear mark in the nation's financial sector and built a towering profile that dwarfs many others around him. His career that spans six decades stands out with high points of achievement. It started with the Civil Service of Pakistan in 1952. Matiul Islam, now 81, is still a taskmaster the chairman of IIDFC, a leading non-bank financial institution.
In 1972 when the shadows of the Liberation War were lingering on the economy, Matiul Islam was handpicked as the nation's first finance secretary by none other than Bangabandhu Sheikh Mujibur Rahman. He had been tasked with building a banking system, the first step to inject an impetus into the war-ravaged economy. Guided by a new government's mandate for nationalisation, he merged 12 banks into six. When many said the new country, Bangladesh that is, would not last long, he pressed on with his mission to build a strong banking system. A personal vision statement “Bangladesh will survive, if banks survive” carried him forward. Today, he does not shy away from admitting that he exerted a total control over the six banks, without appointing a chairman to any of them. Those state banks were free from political influence and performed very well, he recalls.
In the world of private banks as well, Matiul Islam is a pioneer. The first private bank, Arab Bangladesh Bank, now AB Bank, was his creation.
There was a long pause 12 years in his career in the financial sector at home, but he was active abroad, serving the United Nations, World Bank and other organisations from 1981 to 1993. When he came back home, he picked up his earlier thread in his life by setting up International Leasing and Financial Services Ltd, followed by National Housing Finance.
Matiul Islam's latest creation is Industrial and Infrastructure Development Finance Company, a non-bank financial institution. Its shareholders are banks, not greedy individuals, as he likes to put it.
“Earlier experiences taught me that 'don't give shares to individuals; give them to corporations'. So I took banks as shareholders for IIDFC.”
Dr Farashuddin, who was governor of Bangladesh Bank, had insisted that there should be some state banks as shareholders of IIDFC and Matiul Islam did so.
The IIDFC boss advises government officials to be careful about what they should and should not say because people watch them every moment. Honesty and a sense of duty should be the guiding principles for them, he said.
For him, the third principle, perhaps the most valuable, is his willingness to accept any loss or failure gracefully. He participated in bids to privatise Rupali Bank in 2005 by forming a domestic consortium of banks, but lost out to Saudi Prince Bandar Bin Mohammad Bin Abdulrahman Al-Saud, one of the bidders, because his offer fell far short. He congratulated the Saudi Prince's representative after the prince won the bid with a $330 million offer. “I accepted the loss gracefully,” he said. “I think I am a gracious loser.”
Matiul Islam still remembers the most shocking incident in his life: he was forced out of the Pakistan Civil Service in December 1969. As a senior government official, he went to Karachi to plead for relaxing the import policy which was highly controlled at the time. “You needed permission or licence from the government for anything you wanted to import. It was not like what we see today. Now, our import policy is free.”
“I was there in Karachi to plead for what we needed for East Pakistan. I was there to raise our demands. But at the meeting, I was told that 'Mr Islam, your service is no longer required'.”
“It was a big shock not only to me, but to the whole family. I faced it with courage. I always thought it was a temporary setback and I knew I would make a comeback.”
Matiul Islam, never willing to give up the fight, was determined to make a living in Karachi, away from home. And there is always a silver lining in the clouds. He was offered a job at Pakistan National Oil (now Pakistan State Oil) in Karachi and transferred to Dhaka as the country head of the company three months later.
But things changed after independence. Islam lost his job again and was about to begin a new journey to try his luck elsewhere -- again away from home -- in London.
As he was preparing to leave home for good, he received a call from a former colleague with a piece of news that he would have to take a top job on the Awami League government. Matiul Islam still remembers the date: January 11, 1972. Six days later, he took the reins as the country's first finance secretary, with so much power and authority.
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