Home >Industry >Banking >Dhanlaxmi Bank begins search for new chief executive
Lender is looking for a candidate who can steer the bank during a critical phase of recovery during challenging times
Lender is looking for a candidate who can steer the bank during a critical phase of recovery during challenging times

Dhanlaxmi Bank begins search for new chief executive

  • The lender is looking for a candidate with all-round experience of at least 25 years as a commercial banker

MUMBAI : Dhanlaxmi Bank is looking for a new managing director and chief executive officer after Sunil Gurbaxani’s appointment was not ratified by shareholders last month.

“The candidate bank is looking for should have all-round banking experience of at least 25 years as a commercial banker, preferably in areas such as branch operations, administration, credit, retail, small and medium enterprise (SME), treasury, risk management and planning," it said in a public notice on Wednesday.

The bank said it wants a candidate who will “steer the bank during a critical phase of recovery during challenging times". He or she should also be between 52 to 63 years of age as on 1 October 2020, the bank said. Under extant regulations, heads of private sector banks are allowed to hold office till 70 years of age, while their public sector counterparts retire at 60 years.

The Kerala arm of Bank Employees Federation of India (BEFI-K) recently wrote to the Reserve Bank of India (RBI), seeking its intervention into the affairs of the private lender. The union also requested the central bank to appoint an interim managing director with adequate qualifications and efficiency. It alleged that the board of the bank, which is fully packed with the ‘yes men’ of former CGM, has to be dealt with appropriately by RBI.

Dhanlaxmi Bank had said on 1 October that RBI has approved a plan for an interim arrangement through a committee of directors to exercise the powers of managing director till a replacement is found. The committee of directors will be constituted with G. Subramonia Iyer as chairman and G. Rajagopalan Nair and P.K Vijayakumar as members. However, RBI informed the bank that this the interim arrangement will not continue beyond four months.

Gurbaxani was appointed as managing director and chief executive of the bank for a period of three years with effect from 27 February 2020 and has more than three decades of banking experience with State Bank of Bikaner & Jaipur (SBBJ) and Axis Bank. However, in a strange turn of events, shareholders voted against his appointment on 30 September.

The voting took place at the bank’s annual general meeting (AGM), with only 9.5% votes polled in favour of his appointment. To be sure, shareholders approved appointment of all other directors with overwhelming majority.

The bank posted a net profit of 6.09 crore in the June quarter of FY21, down from 19.84 crore in the same period last year. Its gross bad loan ratio stood at 6.89%, while net non-performing asset (NPA) ratio was at 2.18% as on 30 June 2020. The bank’s capital adequacy ratio was also above the regulatory requirement, at 13.94%.

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