Mangaluru: Less than two years after their election to the Board of Directors (BOD), five among the thirteen Directors of the Mangalore Catholic Co Operative (MCC) Bank Limited have tendered their resignations, citing undemocratic style of administration, a source in the bank said.
The five directors, who have sent in their resignation letters, are Melwyn D’Cunha, Dr. Edward Nazareth, Prof. Edmund Frank, Adolphus Cutinha (Dolla) and Shalet Pinto.
It’s, however, not clear if these resignations have been accepted by the bank. Once they are accepted, the bank has to once again go in for elections to fill up the five posts.
The resignation letter, which is available with newskarnataka.com, indicates that a few directors were not happy with the functioning of top management and pointed towards the dictatorial attitude of Bank Chairman Francis Cutinha and persistent groupism.
On September 7, 2013, the team led by Francis Cutinha had secured a majority by winning eight out of thirteen seats, while the then sitting chairman Melwyn D’Cunha won five seats.
More importantly, the resignation of five directors , will only further embarrass MCC bank, which is not making adequate profits, despite having over a hundred years of history. However, the post of chairman remains unchallenged, as Francis Cutinha enjoys the support of seven more directors.
“We were not party to any of the decisions made by the bank, neither were we included in any sub-committee (of loan, appointment, audit and so on). There is no point in continuing with the post, as we are not considered”, one of the directors, who has tendered his resignation, told this reporter.
The resignation letter also points out that not all on the Board of Directors were taken into confidence, especially the experienced directors. “Due to the lack of professionalism and the groupism propagated by the Chairman, the progress of the Bank has been curtailed. The deposit growth is sluggish and the credit off take is absolutely nil. In other words, there is negative business growth in the Bank. The CD ratio has fallen to the level of 50% which indicates that the Bank has been losing its market share continuously”, the letter further states.
“Previously the authority to sanction loans above Rs. 25 lakh was with the Board of Directors. At present the sub-committee is given unfettered powers to sanction loans without any limit and thereafter the sanctions are placed before the Board for for post facto ratification, after disbursement of the loans. This is not a healthy practice”, the director said.
In addition to it, the letter alleges that the Board has made illegal staff appointments without taking proper approval from the Registrar. Reckless contract based appointments are made without requirement which will add an additional burden of about Rs.20 lakh to the staff cost. “When the Bank is passing through a downward trend in business, mass appointment of contract workers are not necessary for the Bank”, he added.
Although, Francis Cutinha initially cited ignorance regarding these developments, he later said that the resignation letters have been received by the general manager of the bank.
He held the five directors responsible for the present state of affairs. “They would have been disqualified from the membership of the BOD, since they did not turn up for three board meetings consecutively”, he said, adding, that resignation is only an attempt to safeguard their image.
When asked about the dictatorial attitude, he said that all the directors have equal authority and resolutions were passed only after the majority proposed it. If there is any mistake in the agenda, they have the right to go through it in detail. Of the five directors, Edmund Frank was part of one of the sub-committees and all of them were given in-charge of, at least one branch. “Ask them, if they have really shown interest in the bank’s growth and visited any of the branches”, he said and added that they were also not present during the recently held general body meeting.
Meanwhile, Anil Lobo, Fermai who led the campaign in support of Francis Cutinha during the previous elections, expressed desire to contest for post, if goes vacant. Mr. Lobo told newskarnataka.com that he regretted supporting Francis Cutinha, who failed to take all the board of directors into consideration to run the bank. “If the bank goes for re-election, I will contest elections”, he said.
