Continuing people issues led to the exit of Amitabh Chaturvedi, managing director and chief executive officer of the Thrissur, Kerala-based Dhanlaxmi Bank, sources familiar with the development said.
Five others at various leadership positions in the bank may have also resigned or are considering their options, the sources said. They include Bipin Kabra, chief financial officer, Rajeev Deoras, head of credit, Manish Kumar, chief people officer, and Salil Datar, head of consumer banking.
However, a spokesperson of the company vehemently denied others were resigning.
After a board meeting on Monday, the bank announced PG Jayakumar, executive director, will be taking over with immediate effect.
Chaturvedi, who took reins of the bank in 2008, was recently granted a second extension of three years by the Reserve Bank of India (RBI).
While Jayakumar has been with Dhanlaxmi for the past 34 years, the appointment still needs approval from the Reserve Bank of India.
“The board has expressed its confidence in the future of the bank,” the statement said.
Rumours were rife that pressure from the officers’ union had led to Chaturvedi’s exit.
The unions have alleged that the bank was involved in some financial irregularities. But in October, the bank clarified the allegations were baseless. The RBI, too, had conducted an investigation into the bank’s books and found nothing wrong.
“It is pertinent to mention that the number of employees in the said association is minuscule and is currently less than 10% of the bank’s workforce. The campaign, therefore, seems to be the handiwork of some misguided employees and some rank outsiders who have no stake in the well-being of the institution,” the old-generation private sector bank had then said in its clarification.
The Dhanlaxmi share ended at Rs56.30, down 2% from Friday.
“Probably, the market was already expecting something of this sort,” says Nitin Kumar, deputy vice-president, Quant Broking.
According to sources familiar with the development, things started heating up at the bank last week when Power Finance Corporation withdrew deposits worth nearly Rs500 crore.
Chaturvedi’s personal deposits have also been moved to another large private sector-bank, these sources said.
The bank will also shift its main office from Worli in Mumbai to a ‘cheaper’ locality.
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