The Hindu Business Line : LKB, Centurion Bank to approach RBI

Having obtained shareholders' consent, Lord Krishna Bank and Centurion Bank of Punjab are slated to approach the Reserve Bank of India on Tuesday, to take the merger proposal forward. Both Centurion Bank of Punjab and Lord Krishna Bank held their AGMs at Goa and Kochi on September 30.

"While seven of the eight resolutions required just simple majority, the special resolution on merger which comes under Section 44 A of the Banking Regulations Act requiring two-third majority was passed with overwhelming support," said Mr B. Swaminathan, Managing Director of LKB.

The next step is for both the banks to approach the regulator with all the requisite clearances, including the bank's board approval, financial and legal due diligence and shareholders' approval.

In addition, Centurion Bank of Punjab will also have to seek SEBI nod for the merger, since it is a listed company, banking sources said.

Protests

There were protest demonstrations outside LKB's AGM in Kochi, with a large section of the employees and a small section of the shareholders demanding that the resolution on the merger should not be passed. They were demanding that the bank be merged with a public sector bank.

Later in the day, the merger resolution was put to vote by Mr R.C. Bhargava, Chairman of the AGM and former Chairman and Managing Director of Maruti Udyog Ltd and passed by the shareholders. Mr Mohan Puri, a director and largest shareholder in the bank with around 65 per cent of its stake was also present.

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