RBI extends term of its nominee on Dhanlaxmi Bank board

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Dhanlaxmi Bank said in a regulatory filing on Friday that the Reserve Bank of India has extended the term of Dr G Jagan Mohan, additional director, for a further period of two years from February 27, 2022, to February 26, 2024, or till further orders whichever is earlier.

Mohan, an RBI nominee, was appointed as additional director by the RBI for a period of two years on February 27, 2020.

Currently, the Thrissur-based lender has just 6 directors, including two RBI nominees as against the maximum strength of 11.

The Reserve Bank of India (RBI) had advised Dhanlaxmi Bank in June 2021 to ensure transparency in the nomination process of directors and follow best corporate governance practices.

The regulator, while pointing out that the bank has had a chequered history on the governance issues, directed the bank to expedite and complete the process of appointment of directors in accordance with the best governance standards.

A case filed by a shareholder and two others against the Bank Board’s decision of rejecting their candidature for the office of director to be placed before the members during the Annual General Meeting on September 29, 2021, is pending.

Five individuals, which include two former directors and prominent NRI Ravi Pillai, moved their candidature under Section 160 of the Companies Act and it was rejected by the board and not placed for consideration of the last annual general meeting.