Nobel Laureate Must Step Down From Bank

Bangladesh's Supreme Court ruled Tuesday that Nobel laureate Muhammad Yunus must step down as head of microlender Grameen Bank, a decision likely to ratchet up diplomatic tensions with the U.S.

The court ruled unanimously to uphold a central bank decision last month that Mr. Yunus, 70 years old, must resign as managing director of Grameen, which pioneered lending small amounts to poor borrowers without collateral.

The central bank found that Grameen had failed to get its approval, as required by a law that formally set up the bank, when it reappointed Mr. Yunus managing director in 1999.

Mr. Yunus appealed, but Tuesday's Supreme Court ruling ended that legal avenue. Nine of Grameen's 12 board members have launched a separate case at the Supreme Court calling for Mr. Yunus's reinstatement, which is likely to be heard Wednesday.

Mr. Yunus has remained at work since the central bank's ruling, but he appears to be running out of legal options to stay.

His ouster, if made final, could dent Bangladesh's international reputation at a time when its textile-driven economy is growing steadily and its moves to clamp down on Islamist extremism have won plaudits.

Some analysts say Mr. Yunus's fame after he shared the 2006 Nobel Peace Prize with Grameen has angered Bangladesh Prime Minister Sheikh Hasina, and that she increasingly views the bank as a competing power center.

While Bangladesh has lurched between unstable civilian and military governments since it was carved out of Pakistan after a 1971 war, nongovernmental organizations like Grameen have grown in stature. Bangladesh received large amounts of foreign aid following independence, which spawned a huge nongovernment sector.

Grameen, which Mr. Yunus founded in the 1970s, initially was aid dependent but hasn't taken donor money since 1998, as it became more profitable.