Court defers ruling on Nobel laureate's dismissal

AP News
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Posted: Mar 06, 2011 5:25 AM
Court defers ruling on Nobel laureate's dismissal

An official says Bangladesh's High Court has delayed its ruling on the legality of a government order dismissing Nobel laureate Muhammad Yunus as head of the microfinance bank he founded.

Attorney General Mahbub-e-Alam says the court is likely to rule Monday.

He says lawyers for Yunus made more arguments Sunday that his dismissal is illegal. The government is to respond Monday.

Bangladesh's central bank ordered Yunus out of Grameen Bank last Wednesday, saying he violated the country's retirement laws.

Yunus' bank, founded in 1983, pioneered the concept of reducing poverty by making tiny loans to the poor. His work spurred a boom in such lending across the developing world and earned him and the bank the 2006 Nobel Peace Prize.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

DHAKA, Bangladesh (AP) _ Bangladesh's High Court was set to rule Sunday on the legality of a government order dismissing Nobel laureate Muhammad Yunus as head of the microfinance bank he founded, a move that prompted concern at home and abroad.

Bangladesh's central bank ordered Yunus out of Grameen Bank on Wednesday, saying he violated the country's retirement laws. Yunus said he was still holding the post and went to the court, which heard arguments challenging the legality of the order.

Deputy Attorney General Karunamoy Chakma said the ruling was expected later Sunday.

The government holds 25 percent share of the bank and the remainder is owned by its borrowers.

Yunus' bank, founded in 1983, pioneered the concept of reducing poverty by making tiny loans to the poor. His work spurred a boom in such lending across the developing world and earned him and the bank the 2006 Nobel Peace Prize.

Yunus, 70, an outspoken government critic, has recently been under pressure at home, where he has long had frosty relations with Prime Minister Sheikh Hasina. She has accused Grameen Bank and other microfinance institutions of charging high interest rates and "sucking blood from the poor borrowers."

She reportedly was angered by Yunus' 2007 attempt to form his own political party, backed by the country's powerful army.

The move to oust Yunus from Grameen has sparked criticism in Bangladesh and abroad. Borrowers and supporters of the bank held human chain protests in parts of Bangladesh on Saturday to demand withdrawal of the government order, local media reported.

In Washington, Sen. John Kerry, chairman of the U.S. Senate Foreign Relations Committee, expressed concern over efforts to remove Yunus and said the international community would watch the situation closely. He said he hoped both sides could reach a compromise that maintains Grameen Bank's autonomy and effectiveness and that Yunus' "lifelong work to reduce poverty and empower women through microloans has deservedly received worldwide attention and respect."

Controversy surrounded Yunus after a Norwegian television documentary that screened in December accused him of transferring Norwegian development funds from Grameen Bank to another venture without prior approval in 1996.

Pressure by the Norwegian Embassy in Dhaka resulted in the funds being transferred back in 1998, and the Norwegian government has said there was no indication Grameen was engaged in corruption or embezzlement.

Grameen Bank currently has nearly 9 million borrowers, 97 percent of whom are women. Many use their small loans to make ends meet or to start small businesses.

Nearly 40 percent of Bangladesh's 150 million people earn less than a dollar a day, the World Bank says.