Resolve your issues quickly and ethically : Request to Yes Bank

Yes Bank is one the promising private sector banks growing at a healthy rate. It is a darling of almost all the Stock research Firms and recently increased its retail business significantly by announcing innovative interest rates. But for the past few days , the company is in the News for wrong reasons. The difference of opinion between promoter families  on the appointment of three directors to the board  came to open and the matter is in the court.

yes 

Yes bank was co-founded by Late Shri. Ashok Kapur and present Managing Director and CEO, Rana Kapoor (brother-in-laws). Ashok Kapur, non-executive chairman of private sector lender Yes Bank, was killed by terrorists in the Trident-Oberoi hotel complex in 26/11 Mumbai Terrorist attack and Rana Kapoor continue to run the show.

“On October 27, 2012, in a filing to the BSE, YES Bank had said that it was appointing Ravish Chopra, Diwan Arun Nanda and M.R. Srinivasan as additional directors.

While Rana Kapoor holds 13.72 per cent in the bank, Madhu Kapur holds 12 per cent that she got after Ashok Kapur’s death in the 26/11 Mumbai terror attacks. The Madhu Kapur family, which has no nominee on the board, argued that according to the bank’s Articles of Association, it must be consulted before the appointment of whole-time directors.

In 2009, the family had proposed the name of Shagun Gogia, daughter of Ashok and Madhu, to bank’s board. However, the board had declined this request, saying she did not meet the “fit-and-proper,” criteria set out by the Reserve Bank of India.”

According to the Bombay HC order, senior counsel Birendra Saraf, representing Madhu Ashok Kapur, said the main grievance of the plaintiffs was that they had not been consulted by Rana Kapoor and, in fact, the names of the three individuals were recommended by Kapoor for the director’s post without concurrence of the plaintiffs.

After Saturday’s AGM, Shagun declined to comment stating that the High Court had barred her from speaking to the press. But an associate of Shagun, who declined to be named, said it is for the RBI to decide if she meets the “fit-and-proper” criteria. “YES Bank cannot make unilateral judgments,” the associate said.The matter will come up again for hearing on Monday at the Bombay High Court.The management declined to comment, pending the outcome of the voting. It only said the result would be made public in the next 48 hours.

The Economic Times reports that “But it is believed that the voting strength is in favour of the appointment will ensure that Diwan Arun Nanda, Ravish Chopra and MR Srinivasan. Although promoters' voting rights are capped at 10%, the presence of a lot of staff and shareholders loyal to the management might have voted in favour of the appointments.”

According to a report published in Today’s The Hindu Business Line “According to shareholders who attended the AGM, a few tried to raise the issue with the management but in vain. The AGM was closed to the media.A few shareholders told newspersons outside the hall that they asked the management to sort out the issue quickly. “We told them that they have to sort out the issue as soon as possible. Once it comes in the media, YES Bank’s reputation will be affected. Share prices will crash. Who will be the sufferers?” asked a shareholder Homa B. Pouredehi.Another shareholder said: “They (the Kapur family) should have been consulted. What YES Bank is doing is not ethical.””

We believe Yes bank is having very high potential. Both the founding families should have  a say on important board appointments. They should have appointed Ms.Shagun Gogia as one of the directors and let the RBI decide on her eligibility.  For the best interest of all concerned including minority shareholders, resolve the issues quickly and amicably.  

0 comments:

Post a Comment

All comments are moderated. Please post no spam

Disclaimer & Privacy Policies

(c) Mrs. Ruby Christy. This site and contents are owned by Mrs. Ruby Christy;
Use of this website and/or services offered by us indicates your acceptance of our Disclaimer& Privacy Policies.

Information and opinions provided on this website (www.investchips.com) has been independently obtained from sources believed to be reliable. However, such information may include inaccuracies, errors or omissions. Investchips.com and its affiliates, information providers or content providers and R.John Christy and his Family shall have no liability to you or third parties for the accuracy, completeness, timeliness or correct sequencing of information available on this website or feeds, or for any decision made or action taken by you in reliance upon such information, or for the delay or interruption of such information. Investchips.com,its affiliates, information providers ,content providers and R. John Christy and his Family shall have no liability for investment decisions or other actions taken or made by you based on the information provided on this website. Any action you choose to take in the markets is totally your own responsibility. Investchips.com and R. John Christy and his Family will not be liable for any, direct or indirect, consequential or incidental damages or loss arising out of the use of this information. This information is neither an offer to sell nor solicitation to buy any of the securities mentioned herein. Opinions expressed by R. John Christy are his own and not of his past, present and future employers.
The DoubleClick DART cookie is used by Google in the ads served on this websites displaying AdSense for content ads. When users visit this website and either view or click on an ad, a cookie may be dropped on that end user's browser.
  • Google, as a third party vendor, uses cookies to serve ads on this site.
  • Google's use of the DART cookie enables it to serve ads to your users based on their visit to this site and other sites on the Internet.
  • Users may opt out of the use of the DART cookie by visiting the Google ad and content network privacy policy.
  • www.investchips.com never collects any personal information of visitors.