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Dhanlaxmi Bank Chairman G Subramonia Iyer resigns citing personal reasons

Iyer has cited certain urgent and emergent domestic and personal reasons and there were no other material reasons for his resignation, the bank said.

December 02, 2021 / 07:12 PM IST

G Subramonia Iyer, part-time Chairman and Independent Director of Kerala-based Dhanlaxmi Bank, has submitted his resignation citing personal reasons, the bank informed the stock exchanges on December 2.

Iyer has cited certain urgent and emergent domestic and personal reasons and there were no other material reasons for his resignation, the bank said.

The resignation is effective from December 31, 2021.

Iyer was appointed as part-time chairman in February, 2021.

Last year, Sajeev Krishnan, part-time Chairman and independent director of Dhanlaxmi Bank, too had resigned on June 29 citing personal reasons.

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There have been several senior level exits from the Dhanlaxmi Bank’s board over the last few years. Following Krishnan’s resignation last year, two more board members had quit the bank. These are K.N. Murali, Independent Director and G. Venkatanarayanan, Additional Director.

Major differences between some shareholders and them has been cited as a cause, according to insiders. Murli joined the bank nearly 1.5 years ago while Venkatanarayanan joined only a few months ago.

In September 30, last year, Dhanlaxmi Bank’s former CEO, Sunil Gurbaxani was ousted by the shareholders at the bank’s annual general meeting. Later in an interview with Moneycontrol, Gurbaxani said Dhanlaxmi Bank needs a deeper surgery to resolve the long-standing governance issues.

“The deeper governance issues in the bank need surgery and not a bandage solution. Issues that have been chronic for many years, the exit of many previous officials including MDs and part-time chairman speaks seriousness on the lack of governance and deserves investigation,” Gurbaxani said.

Differences at the top are not new for Dhanlaxmi Bank. A letter written by K Jayakumar, a former director, to the chairman after his resignation in April 2016, offers some clues. 

Former and serving senior executives Moneycontrol spoke to said many of the points raised by Jayakumar, mainly the dominance of management over the board, still held. These differences could have played a role in recent exits, they said. 

 “I have lost faith in the capacity of this management and its ethos… I wonder why the initiatives approved by the Board and the several suggestions and admonitions of the RBI have repeatedly failed to yield the desired results. I am shocked by the abysmal lack of grace in dealing with difficult situations….,” said the letter, a copy of which is with Moneycontrol.

The letter also talked about ego clashes, human resources policies and governance issues.

“They (management) seem to presume that the directors have to be necessarily ‘yes men’. Any note different from ‘his master’s voice’ is unacceptable. ‘Dissent with dignity’ seems to be unknown in their lexicon. Once a Director (who is paradoxically called Independent Director!) is suspected to have different views, then he has to be sidelined if not humiliated,” Jayakumar said.

“I am pained at the short-sightedness that fails to regard the commitment and contentment of the employees as paramount for the survival and success of the Bank in its darkest hour,” the letter said.

 

 
Moneycontrol News
first published: Dec 2, 2021 06:56 pm

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