Dhanlaxmi Bank shareholders vote to oust chief executive

Dhanlaxmi Bank

30/09/2020 16:06

By Nupur Anand
    MUMBAI, Sept 30 (Reuters) - Shareholders of regional lender
Dhanlaxmi Bank  DNBK.NS  ousted its chief executive at its
annual general meeting on Wednesday, the bank said in a
regulatory filing.
    More than 90% of shareholders who voted opposed the
appointment of Sunil Gurbaxani, who had been approved by the
Reserve Bank of India in February as CEO of Dhanlaxmi for a term
of three years.  urn:newsml:reuters.com:*:nFWN2AK0LL
    The bank's regulatory filing did not give any reasons for
the CEO's ousting.
    The All India Bank Employees’ Association (AIBEA) said
employees and shareholders were not happy with the way Dhanlaxmi
Bank was being run under the new CEO. 
    "Under the new CEO the bank was planning to expand its
operations to north India and also hire 500 employees ...
something which would not be feasible for a small south
India-based regional bank," C. H. Venkatachalam, AIBEA's general
secretary, said.
    Dhanlaxmi Bank and Gurbaxani did not immediately respond to
requests for comment on remarks made by AIBEA.
    The association represents about 500,000 bank employees
across India, including from Dhanlaxmi Bank.
    Dhanlaxmi bank is a relatively small private Indian lender
with 247 branches and a total deposit base of 111.09 billion
rupees ($1.51 billion).
    In a similar move last week, shareholders of another private
Indian lender, Lakshmi Vilas Bank  LVLS.NS , voted against the
reappointment of its CEO and six other directors. The bank had
been struggling with bad loans and governance issues.
 urn:newsml:reuters.com:*:nL4N2GP1AM
    Shriram Subramanian, founder of proxy advisory firm
InGovern, called such decisions by shareholders were rare but
said it would make managements more accountable.
    "In a way it is a good sign as shareholders have now
realised that they have voting powers to make a significant
decision," said Subramanian. 

 (Reporting by Nupur Anand; Editing by Aditya Kalra and Jane
Merriman)
 ((Nupur.Anand@thomsonreuters.com; +9122 68414388;))