Tayal Is Bank Of Rajasthan Chief, Rights At 5:2
The board of Bank of Rajasthan has unanimously elected Pravin Kumar Tayal, the promoter of Mumbai-based Rs 447-crore Sree Krishna Petro Yarns, as its new chairman.
At its meeting in New Delhi yesterday, the board also fixed the bank's rights issue at Rs 67 crore in a ratio of 5:2.
The term of the present chairman D B Sogani ended on December 5, 1998. The board has decided to charge a premium of Rs five per share, according to industry sources close to bank. Each share will also carry a free warrant.
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The rights issue will hit the market before March 1999 as per the Reserve Bank of India's directive. RBI has appointed its nominee on the board of the bank and given the go-ahead for the issue recently. The apex bank had asked BoR to hike its capital to risk weighted adequacy ratio to 8 per cent from six per cent.
The meeting also inducted four new members into the bank board including Sanjay Kumar Tayal, brother of Pravin Kumar Tayal, B R Gupta, representing the General Insurance Corporation, Somprakash Arya, and Deepak Sarupuria. Efforts to contact Pravin Kumar Tayal, the new chairman of the bank, proved futile as he was travelling.
With the induction of Tayal as the new chairman and clearance of the rights issue, decks has been cleared for the Tayal family to pick up a substantial stake from the present one per cent in the loss-making bank. Bank of Rajasthan had an accumulating loss of around Rs 82 crore as on September 1998. The bank reported a net loss of Rs 87 crore in the fiscal 1997-98.
Tayal family has been eyeing a stake in the bank for some time and its proposal to induct two family members into the board, including Pravin Kumar Tayal, has been cleared by the RBI on Monday.
As part of the RBI stipulation, the Tayals has already deposited around Rs 20 crore into the bank as a portion of the security deposit.