Shareholders of Thrissur-based Dhanlaxmi Financial institution on Wednesday ousted managing director and CEO Sunil Gurbaxani on the financial institution’s annual common assembly (AGM). That is the second such ouster of a personal Financial institution chief govt in lower than per week. Final week in a coup of types, round 60 per cent of the shareholders at Lakshmi Vilas Financial institution had voted in opposition to seven administrators together with MD & CEO S Sundar.
Within the case of 93-year-old Dhanlaxmi Financial institution, over 90 per cent of the votes have been polled in opposition to Gurbaxani’s appointment. The voting outcomes have been made public by way of inventory alternate filings. Of the 10 resolutions, this was the one one which was voted in opposition to by the shareholders.
The authorised resolutions embrace appointment of Gopinath CK, G Subramonia Iyer, Captain Suseela Menon R, G Rajagopalan Nair and PK Vijayakumar as administrators.
Gurbaxani, a veteran banker, took over as CEO at Dhanlaxmi Financial institution in February 2020. A supply stated that Gurbaxani had proposed a preferential challenge, which might have introduced down the prevailing shareholders’ stake. This, together with the administration proposal to open 25 branches in North India, resulted within the shareholders’ vote in opposition to the MD, the supply stated.
Whereas Dhanlaxmi Financial institution faces governance points just like these in Lakshmi Vilas Financial institution, the monetary profile of the Kerala-based financial institution is healthier. LVB is working below the Immediate Corrective Motion (PCA) provision.
As a substitute of consolidating the positive factors and strengthening the financial institution, an try was being made to vary the enterprise profile of Dhanlaxmi Financial institution, a piece of the shareholders believes. A few of these shareholders are additionally staff of the financial institution.
Nevertheless, shareholders backing Gurbaxani alleged that these voting in opposition to him have been influenced by a senior official who was pressured to resign by the Reserve Financial institution of India (RBI) lately.
A supply near the board stated the voting in opposition to the MD & CEO was the fruits of an influence battle by majority shareholders. He added that the most recent growth might immediate RBI to intervene.
Based on folks aware of the problems, whereas there’s no single promoter, a big stake within the financial institution is held by a gaggle of native businessmen.
Just lately, D Okay Kashyap, common supervisor, RBI (Bengaluru Regional Workplace) was appointed extra director on the board of Dhanlaxmi Financial institution.
Since June, three board members of the financial institution had stop. On June 29, Sajeev Krishnan, part-time chairman and impartial director, stop citing private causes. He had round eight months left in his time period. Okay N Murali, impartial director, and G Venkatanarayanan, extra director, too stepped down earlier than the tip of their tenure.
Following these exits, the financial institution had inducted P Okay Vijayakumar, G Rajagopalan Nair, G Subramonia Iyer and Suseela Menon R as board members.
T Latha had resigned as MD and CEO of Dhanalaxmi Financial institution in October 2019, inside 15 months of taking cost, citing private causes. Her appointment was for 3 years.
Early this week C H Venkatachalam, common secretary, All India Financial institution Workers Affiliation (AIBEA), had written to the RBI, elevating concern over the state of affairs within the financial institution highighting its excessive price to revenue ratio.