Dhanlaxmi Bank Shares Battered on BSE; Lender Denies Charges
Mumbai: Shares of Dhanlaxmi Bank plunged over 24 per cent on the BSE during the day after the All India Bank Officers'' Confederation (AIBOC) raised concerns over its financial health, an allegation denied by the lender.
The Confederation Tuesday demanded a comprehensive inquiry into the functioning of the management of Kerala-based lender which, it alleged, was marked by "extravagance and neptitude".
The allegations of financial mismanagement led to a bloodbath on the bank counter as the stock lost over 24 per cent to 
54.25 on the BSE-- the biggest one-day fall since May 2009.
The shares, however, recovered from day''s lows later but still closed down by 9.99 per cent at 64.45 on the BSE.
The AIBOC leaders, including its senior Vice-President P V Mathew and Kerala state President P V Sivasankara Pillai, told reporters in Thiruvananthapuram that while the bank management was claiming all-round development, its profit in the first quarter of 2011-12 stood at a mere 3 crore.
The private lender denied allegations of financial irregularities and said the numbers provided by AIBOC do not "match with the bank''s internal numbers".
"The allegations are baseless and we do not know from where they have pulled out these numbers. None of these numbers match with our internal numbers," Bank''s Chief Financial Officer Bipin Kabra said.
The union leaders also alleged that the right to disburse loans had been taken away from managers and even loans in the priority sector had been stopped. The Credit Deposit Ratio of the bank had fallen to 36 per cent against the national figure of 77 percent, they told reporters.
They also alleged the funds of the bank, meant to be used for the development of the rural, agricultural and small-scale sector in the state, were being diverted to monopolies from other states by way of huge loans.
Disputing the union charges of the bank having issued certificate of deposits (CD) worth 2,500 crore, Kabra said "our CD number is not even half of that. It is only Rs 1,200 crore. Similar is the case with their allegation of interbank deposits of 1,500 crore, while this is just 1,100 crore."
Stating that the numbers are doctored, he said, "the union is propping up numbers from October, while we have not yet audited our Q2 numbers."
Attributing real reason behind the issue as a fight for survival, Kabra said their numbers are fast dwindling and today the unionised employees constitute only 10 per cent of the 4,600 workforce of the bank. "No new employees want to join the union, so they are worried about their survival."
Kabra also denied the charge that bank has an unaccounted for provision of 100 crore, saying if my quarterly expenses are only Rs 105 crore and if net NPA has been consistently improving, how can I have such numbers?
Source: PTI
54.25 on the BSE-- the biggest one-day fall since May 2009.
The shares, however, recovered from day''s lows later but still closed down by 9.99 per cent at 64.45 on the BSE.
The AIBOC leaders, including its senior Vice-President P V Mathew and Kerala state President P V Sivasankara Pillai, told reporters in Thiruvananthapuram that while the bank management was claiming all-round development, its profit in the first quarter of 2011-12 stood at a mere 3 crore.
The private lender denied allegations of financial irregularities and said the numbers provided by AIBOC do not "match with the bank''s internal numbers".
"The allegations are baseless and we do not know from where they have pulled out these numbers. None of these numbers match with our internal numbers," Bank''s Chief Financial Officer Bipin Kabra said.
The union leaders also alleged that the right to disburse loans had been taken away from managers and even loans in the priority sector had been stopped. The Credit Deposit Ratio of the bank had fallen to 36 per cent against the national figure of 77 percent, they told reporters.
They also alleged the funds of the bank, meant to be used for the development of the rural, agricultural and small-scale sector in the state, were being diverted to monopolies from other states by way of huge loans.
Disputing the union charges of the bank having issued certificate of deposits (CD) worth 2,500 crore, Kabra said "our CD number is not even half of that. It is only Rs 1,200 crore. Similar is the case with their allegation of interbank deposits of 1,500 crore, while this is just 1,100 crore."
Stating that the numbers are doctored, he said, "the union is propping up numbers from October, while we have not yet audited our Q2 numbers."
Attributing real reason behind the issue as a fight for survival, Kabra said their numbers are fast dwindling and today the unionised employees constitute only 10 per cent of the 4,600 workforce of the bank. "No new employees want to join the union, so they are worried about their survival."
Kabra also denied the charge that bank has an unaccounted for provision of 100 crore, saying if my quarterly expenses are only Rs 105 crore and if net NPA has been consistently improving, how can I have such numbers?
