A spate of investments by small obscure, gramin banks from all over the country had helped the house of the Tatas mop up as much as 42 per cent of the Rs 89.7 crore that the groups holding company Tata Sons raised through a non-convertible debenture (NSD) issue of Rs 5-lakh each in 1995.
The number of rural banks, which had subscribed to the 16.75 per cent secured non-convertible fixed debentures, is estimated at 32. As a category, these rural banks accounted for the largest share of the NCDs.
The details of a large number of rural banks subscribing to the Tata Sons NCDs have come to light now following Business Standards investigations. A document indicating the detailed break-down of the subscribers shows that apart from the rural banks, commercial banks formed the second largest category accounting for about Rs 31 crore of the total NCDs available for subscription.
The investing banks are all currently holding on to the Tata Sons debentures, sources in Tata said. According to sources, Tata Sons had raised the funds to finance its investment and consultancy activity.
A majority of the 48 banks and financial institutions that had subscribed to the Tata Sons issue are unknown small banks from the heart of rural India, stretching from Nainital in the North and Cuddalore in the South.
While Sabarkantha Gandhinagar Gramin bank from Sabarkantha in rural Gujarat invested Rs 75 lakh, Vallalar Grama Bank from Cuddalore in South Arcot,Tamil Nadu invested Rs 25 lakh towards the Tata Sons issue.
Banaskantha Mehsana Gramin Bank from Patan, North Gujarat contributed Rs 1 crore towards the issue; Surendranagar Bhavnagar Gramin Bank and Surendranagar Venkateswara Grameena Bank, Chittoor; Nainital Bank and Nainital Almora Kshetriya Gramin Bank, Nainital; Golwala Enterprise, Surat; Adhiyaman Grama Bank, Dharmapuri, Tamil Nadu had all invested Rs 25 lakh each in the Tata Sons issue.
Etah Gramin Bank, Etah; Godavari Grameena Bank, Rajamundry, Andhra Pradesh; Golconda Grameena Bank, Hyderabad; Junagarh Amreli Gramin Bank, Gujarat; Karur Vysya Bank, Mumbai; Kolar Gramin Bank, Kolar; Lakhimi Gaonlia Bank, Assam; Singhbhum Kshetriya Gramin Bank, Singhbhum; Lakshmi Vilas Bank, Karur; all contributed Rs 50 lakh towards the NCDs, while Abu Dhabi Commercial Bank, Mumbai, and Hazaribag Kshetriya Gramin Bank, Bihar invested Rs 30 lakh each.
Tungabhadra Gramin Bank of Karnataka invested Rs 3 crore in the issue, and Aligarh Gramin Bank, Aligarh Rs 2.5 crore.
Aurangabad Jalna Gramin Bank, Aurangabad; Avadh Gramin Bank, Lucknow; Palamau Kshtriya Gramin Bank, Bihar; Rushikulya Gramya Bank, Ganjam; Sangli Bank Mumbai; State Bank of Mysore; and State Bank of Saurashtra, Mumbai each invested Rs 2 crore in the Tata Sons NCD issue.
Dena Bank, Mumbai invested Rs 1.75 crore while State Bank of Hyderabad, Mumbai and South Malabar Gramin Bank, Kerala each invested Rs 3 crore.
The big investors in the issue included Bank of India, Mumbai; Industrial Finance Corporation, and Mahindra&Mahindra with Rs 10 crore each. Marathwada Gramin Bank, Nanded and State Bank of India, Mumbai, invested Rs 5 crore each in the issue while United Bank of India, Mumbai put in Rs 4 crore in the NCD issue.
