7 TMB investors allowed to cast vote, elect directors

In what might seem another twist to the never ending saga of the Tamilnad Mercantile Bank Ltd (TMB) the first annual general meeting held after seven years saw seven investors holding 33 per cent stake cast their votes through power of attorney to elect 10 new directors of the bank.

The Nadar Mahajana Sangam has said that it would dispute the move in the high court. S Ramalingam, a retired judge who presided over the AGM, had chosen to allow the seven investors to exercise their votes based on the 33 per cent stake held by them.

The Madras High Court bench had restrained the seven investors from exercising their voting right on 10 March. When queried on this, Ramalingam refused to comment.

The high court had reversed its division bench's suspension of an interim stay against the transfer of 33 per cent stake held by C Sivasankaran's Sterling Group led by B Ramchandra Adityan on 10 March. The 33 per cent share transfer had to get the approval from Reserve Bank of India.

The Nadar Mahajana Sangam has condemned the decision of Ramalingam to allow the seven investors to cast their votes and the way the election of the ten directors was conducted.

Karikol Raj, general secretary, Nadar Mahajana Sangam, said that the poll sheets did not have the bank seal or the folio number and the validity of the poll sheets was very doubtful. The Nadar Sangam expects to take this issue to the high court, political parties and various other forums.

The results of the election of the 10 directors are expected to be out tomorrow. Shareholders representing 1,97,264 shares amounting 69.34 per cent of the stakes had cast their votes to elect the new directors.

For the 10 new directors about 51 applicants had contested of which seven withdrawn their applications before the elections. Around 21,000 proxies were received of which 4,000 proxies were invalid.

Annual general meetings pending from the financial year 1996-97 to 2002-03 were taken up.

The bank had decided to give about dividend of Rs 7 for each share for 1996-97 while dividends of Rs 8 per share will be given to the shareholders for 2000-01, 2001-02 and 2002-03.

The shareholders voted for the accounts of 1996-97 and approved the remuneration for R Natarajan the chairman during the general body meeting.

The bank officials had expected about 7,000 shareholders to participate in the AGM but only 3,000 turned up. R Natarajan, chairman, TMB said that the former judge had taken the decision to allow the seven investors to cast their votes as otherwise one third of the total votes would have gone wasted.

TMB's next AGM is expected to be held in August. Natarajan said that the bank expected to close the current fiscal with operating profits of Rs 160 crore of which Rs 80 crore would be net profits.

"We trying to curtail the gross non-performing assets which amounts to 14.5 of the total advances as the advances have not grown during the year. The gross NPAs were brought down from 19 per cent in 2002 to 16.5 per cent in 2003 and the bank is making attempts in bringing down its NPAs," he added.