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Tuesday, Jul 27, 2004

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From promoter to zero stakeholder

Jayanta Mallick

Kolkata , July 26

MR Ramesh Gelli, the aggressive banker-turned-promoter who created ripples in the private banking space in 1994 by floating Global Trust Bank (GTB), has been rendered "zero-value" stakeholder of GTB.

According to observers, the proposed merger of GTB with Oriental Bank of Commerce would mean that Mr Gelli's promoter holding would be rendered valueless.Though it is believed that he actually controlled over a quarter of the bank's total stake, the holding in his personal account or family members' accounts was insignificant.

Mr Gelli's personal holding in the bank was placed unchanged at 1.83 per cent as on March 31, 2004. Ms Premkala Gelli's holding had gone up marginally to 1.88 per cent from 1.69 per cent on September 30, 2002.

Mr Girish Gelli, who held 1.14 per cent on September 30, 2002 did not have anything in his personal name at the end of 2003-04. The 1.55 percent holding in the name of Mr Neeraj Gelli, which was there on the GTB records as on September 30, 2002, was also absent in the promoters' stakeholding list at the end of last fiscal.

A web of political and business links, and unconventional risk management and deal-making style had made him a high-flying banker-promoter. Even after stepping down as Chairman of GTB, he had allegedly been engaging in backseat driving.

Even as late as last year, he had reportedly had facilitated a Rs 10-crore loan - to float online lottery business - to an industrial group with a chaotic financial track record.

Senior bureaucrats in the Union Finance Ministry and politicians indicated that the "relaxed vigilance" in the past over the GTB could be attributed to political factors.

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