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Dhanlaxmi Bank’s shareholders on Wednesday rejected the appointment of Sunil Gurbaxani as MD and CEO, with 90.4 per cent of the votes polled being against the resolution seeking approval for his appointment at the Bank’s 93rd annual general meeting.
Following this development, the Reserve Bank of India (RBI), which has two additional directors on the Board of the Thrissur (Kerala) based Bank, may set up a committee of directors to look after daily affairs of the Bank.
Out of the 10 resolutions which were put to vote, only Gurbaxani’s appointment was not approved by the shareholders, according to the Bank’s regulatory filing.
Appointments approved
The nine resolutions that were approved with a majority of over 99 per cent of the votes polled included the appointment of five independent directors – Gopinathan CK, G Subramonia Iyer, Capt Suseela Menon R, G Rajagopalan Nair, and PK Vijayakumar; and to increase the authorised share capital (from ₹300 crore to ₹400 crore) and consequent alteration to the Memorandum of Association & Articles of Association of the Bank.
Sunil Gurbaxani’s appointment as MD and CEO of Dhanlaxmi Bank on February 20, 2020 for three years came about three months after T Latha resigned the top position at the Bank on October 30, 2019.
A tug of war between Dhanlaxmi Bank’s large individual shareholders with roots in Kerala and the new management, that is keen on roping in new shareholders, is apparently the reason the old-generation private sector bank is currently was a state of flux.
“If Reserve Bank of India does not effectively intervene in the affairs of this bank now, once again it will run into problems,” said CH Venkatachalam, General Secretary, All India Bank Employees’ Association, in a letter to RBI Governor Shaktikanta Das.
Soumya Datta, General Secretary, All India Bank Officers’ Confederation, urged the Governor to take appropriate steps so that Dhanlaxmi Bank (DLB) is allowed to grow in its own space, catering to its own niche segments.
“It seems that the intention is to replicate the practices of another institution, which will not at all be suitable for Dhanlaxmi Bank or for that matter any other old generation bank. The policies that are being pursued will be inimical for the bank,” he said.
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