Local community apprises PM of Tamilnad Mercantile Bank row

Thuthukudi Nadargal Mahamai raises allegations against bank's directors

Thuthukudi Nadargal Mahamai (TNM), a community group involved in the dispute about control of Tamilnad Mercantile Bank (TMB), has sent a petition to Prime Minister Narendra Modi, Finance Minister Arun Jaitley and other officials urging them to take steps against some of the decisions of the current management controlling the bank.

In its petition, TNM alleged that the present management, which is said to be controlled by uS-based Corsair Group, is trying to convert 1,12,151 equity shares of the bank, representing 40 per cent holding, into demat and has expelled the lender's company secretary for opposing the move.

TMB management was not immediately available for a comment.

TNM said the US group had bought the shares in 2007 under various names and lodged them in an escrow account with Standard Chartered Bank in Mumbai and that the Enforcement Directorate (ED) has been investigating the transaction for violations of foreign exchange regulations.

Converting the shares to demat would result in a change of hands without raising concerns from anybody else, TNM claimed, adding that the management had postponed the annual general meeting, which was to be held on or before September 30, 2016.

TNM requested the authorities to order the previous position to be maintained regarding the shares under dispute, till ED completes the probe. The community group also urged the RBI to order TMB not to demat these shares, and sought the government's intervention in reinstating the company secretary.