- IndusInd Bank shareholders rejected IIHL's proposal to appoint two nominee directors to the board
- The proposal required amending the bank’s articles of association but was not carried
- IIHL owns 15% of IndusInd Bank and seeks RBI approval to raise stake to 26%
Shareholders of IndusInd Bank on Friday rejected promoter IndusInd International Holdings Ltd.'s proposal to induct two nominee directors to the board.
More than half of the shareholders voted against the IIHL proposal, which required an amendment to the bank's articles of association.
"We understand that the said resolution in the IndusInd Bank AGM held today was not carried through, although the proposed resolution was in compliance with the applicable laws and governance practices," IIHL President and Chief Executive Officer Moses Harding said in a release issued late on Friday.
Harding believes there is a "misinterpretation" in proxy advisors' apprehensions related to IIHL's bid for board nominees, and said that the promoter entity would be "happy to address the concerns".
IIHL had moved the proposal after receiving approval for the same from the Reserve Bank of India and IndusInd Bank's board, he added.
IIHL pointed towards its support for the lender since the past 30 years, which includes the subscription of 1.57 crore warrants in February 2021 at Rs 1,709 per share as against the market price of Rs 1,046, resulting in a total capital infusion of Rs 2,683 crore. It also highlighted the support it provided during the 2008 Lehman crisis and the period of Covid-19 pandemic.
IIHL presently owns 15% stake in IndusInd Bank, down from over 90% in 1994. The shareholding was reduced to comply with the RBI's ownership and governance rules. However, it is currently awaiting approval to raise its stake to 26%.
While IndusInd Bank shareholders blocked IIHL's proposal for board nominees, they cleared the appointment of Rajiv Anand as the managing director and CEO. He has been given a three-year term at the bank's helm, and the appointment comes in the backdrop of the accountancy discrepancy row that has adversely impacted the private lender.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
