The panel will exercise the discretionary powers of the chief executive and will be headed by existing independent director Meeta Makhan, the bank said in a statement
The other two members of the panel are Shakti Sinha and Satish Kumar Kalra, who are also independent directors on the bank’s board
The Reserve Bank of India (RBI) on Sunday approved the formation of a three-member committee of directors to temporarily run the struggling Lakshmi Vilas Bank Ltd after shareholders voted out seven directors, including managing director and chief executive S. Sundar.
The panel will exercise the discretionary powers of the chief executive and will be headed by existing independent director Meeta Makhan, the bank said in a statement. The other two members of the panel are Shakti Sinha and Satish Kumar Kalra, who are also independent directors on the bank’s board.
Earlier in the day, the bank said it does not have any asset-liability mismatch and is successfully fulfilling its commitments to deposit-holders, bond-holders, account-holders and creditors. The bank said the appointments of N. Saiprasad, K.R. Pradeep and Raghuraj Gujjar as non -executive and non-independent directors, and B.K. Manjunath, Gorinka Jaganmohan Rao and Y.N. Lakshminarayana Murthy as non-executive and independent directors, were also rejected.
These appointments were taken up for voting at the bank’s annual general meeting (AGM) on 25 September.
Shareholders voted against these appointments, because of the bank’s growing levels of non-performing assets and uncertainty related to its ability to continue as a going concern, said an institutional investor, requesting anonymity.
The development comes at a time when the bank is desperately looking for capital and is in talks with the Clix Group for a merger. The bank’s capital adequacy ratio as per Basel III guidelines contracted to 0.17 % as on 30 June, and its loss narrowed to ₹112.28 crore in Q1 from ₹237.25 crore a year ago.
“Many directors have rotated on-and-off. A part of the accountability for the bank’s deteriorating performance rests with its slate of non-independent directors," Institutional Investor Advisory Services (IiAS) had said in a report. According to Amit Tandon, chief executive of IiAS, the bank has a combination of negative tier-1 capital ratio, losses, eroding deposit base, high bad loans and low provisions . “Yet it powers on, backed by the promise of raising capital."