Dhanlaxmi director resigns; flags governance issues

NEW DELHI:   Independent director of Dhanlaxmi Bank Sridhar Kalyanasundaram has labelled allegations against the bank’s management and its MD and CEO Shivan JK. Kalyanasundaram, who on Sunday resigned from his directorship, has alleged that his inputs were deliberately negated or overruled by other board members to support the ‘belligerent attitude of the MD & CEO’. He has alleged ‘a few board members deliberately stifled discussions by other members of the Board.

The independent director has in his resignation letter pointed out many instances where other members of the bank board sided with the MD and CEO, overruling concerns raised by him. He cites the example of the issuance of rights to shareholders, where he says despite several queries raised by him, the management tries to bulldoze through the issuance process.

He alleged due to his resistance to giving a nod to the rights issue in its current form, he was threatened of being thrown out of the board by the management. He also alleges the bank management of using one-time-settlement (OTS) indiscreetly even in cases where there were no NPAs. He cites the example of Jalan Hotels of Kolkata, where the OTS was used to release a guarantor at a discounted Rs 5.25 crore against a reported market value of Rs 35 crore. Kalyanasundaram alleges the management of not taking action on numerous whistle-blower complaints.

The independent directors also raised the issue of the manner in which the MD and the Company Secretary were conducting the Board and Committee Meetings deciding on the agenda and the frequency of the same.