The Hindu Business Line : Finance Ministry defends Damodaran's move to step down

THE Ministry of Finance today defended the IDBI Chairman, Mr M. Damodaran's move to relinquish charge as Administrator of Specified Undertaking of UTI (SUUTI or UTI-I) and as Chairman of UTI Mutual Fund, and hinted that the move was not linked to the recent developments at UTI Bank.

In a statement, the Ministry said that Mr Damodaran's decision to step down from posts in SUUTI and UTI MF was only to facilitate appointments in the two entities.

"Since October 1, 2004 the Government has considered the matter of appointing a Chairman for UTI MF and an Administrator for SUUTI.

"In order to facilitate these appointments, Mr Damodaran has relinquished the charge of UTI-MF and SUUTI," the release said.

While former LIC Chairman, Mr S.B. Mathur, has been appointed Administrator of SUUTI, the Ministry has said that the Chairman of UTI MF would be appointed shortly by its sponsors in consultation with the Government.

"The Government appreciates the excellent work done by Mr Damodaran in dividing the former UTI into UTI-MF and SUUTI and turning around the fortunes of UTI-MF," the release said.

The Ministry also said that Mr Damodaran must pool in all his energies to guide IDBI.

As CMD of IDBI, Mr Damodaran was holding additional charge of UTI-MF and SUUTI.

"(IDBI Bank) is a bank in which Government of India holds, directly, 58.5 per cent shares and, through other public sector enterprises, a further 11.3 per cent.

"IDBI requires the full-time and undivided attention of its CMD, Mr Damodaran," the Ministry said.