Uwb Board To Send Proposal To RBI On Sicom Spat

The board of the Satara-based United Western Bank (UWB) has decided to request the Reserve Bank of India (RBI) to reconsider its "proposition", whereby the bank's managing director & CEO, S T Gadre, was given a week's time to either sort out the UWB management's legal tussle with the Sicom-Makharia combine or step down.

The bank, after its board meeting held at Satara today, issued a one-line statement to the effect that "the Board has decided to request Reserve Bank of India to reconsider its proposition."

It may be recalled that the RBI deputy governor G P Muniappan held a meeting with Gadre on April 4 to take stock of the developments in the UWB. At the meeting Gadre was given an ultimatum to either resolve outstanding disputes with the shareholders or face the prospect of being sacked.

The management and the Sicom-Makharia combine have been at loggerheads as the latter wanted to have a greater representation on the board and had opposed a bonus-cum-rights issue last year while the UWB management's position before the CLB is that the Makharia's had acquired a substantial stake in the bank in violation of the SEBI norms governing substantial acquisition of shares.

Meanwhile, Sicom sources said that the bank had convened the board meeting without giving the adequate notice period. The two directors representing Sicom, A K D Jadhav and Sharad Upasani, could not attend the meeting due to this.

The Sicom-Makharia combine together have close to 24 per cent shareholding in the bank. While Sicom holds around 10 per cent stake, the Makharia family holds around 14 per cent stake. The management holds less than one per cent stake in the bank. An unregistered employees' trust holds around 9 per cent stake and the balance 66 per cent is held widely held by the public.