Ravinder Singh, Managing Director of SVC Co-operative Bank Limited has emailed the Bank’s rebuttal of the story on SVC Bank elections appearing in these columns, in which one of the contestants Mr Ravi Pagare levelled charges against the outgoing Board led by Durgesh Chandavarkar.
Since the Indian Cooperative’s editorial team has always upheld the principle of giving coverage of the other side of the story, we publish the following:
1. The first allegation put forth by Mr. Pagare, “outgoing board is only focusing on encouraging the Gaud Saraswat Brahmins (GSB) community, not on others” is completely baseless.
The Bank has conducted elections to the Board of Directors every 5 years, as per extant laws, over the past several decades. The present Board of Directors of the Bank are highly qualified professionals with expertise in banking, finance, legal, information technology, customer service, etc., as required by the extant regulations. Over a period of time, such a competent Board of Directors have leveraged the growth and development of the Bank with proper guidance and corporate governance. As a Bank, we never put forth caste or religion over competence and qualification.
2. The second allegation attributed to Mr. Pagare is “The management had appointed Pravin Kadale as Financial Advisor who belongs to their community and was giving Rs 4 lakh per month as a salary. But after the RBI objection, the outgoing management removed him in March 2022” which is also baseless.
Not only the remuneration figure is factually incorrect, but more importantly, Mr. Praveen Kadle’s engagement with the Bank was always for one year starting from March 2022, which successfully ended in March 2023.
Mr. Praveen Kadle – ex-Managing Director and ex-CEO of Tata Capital Ltd., is a qualified Chartered Accountant, Cost & Works Accountant and a Company Secretary. He has held senior positions across the Tata Group and was instrumental in the turnaround and financial restructuring of erstwhile Tata Finance Ltd. He has won many accolades for his exemplary contribution to Finance. Given his accomplishments, Mr. Praveen Kadle was appointed an Advisor to the Board of Directors to get professional guidance to enhance business capabilities. We live in a competitive environment where the cooperative sector faces stiff competition from public, private, and multinational banks. The Board sought professional inputs from Mr. Kadle to facilitate Board’s endeavour to make SVC Bank a top-notch bank in the cooperative sector.
3. Mr. Pagare’s third allegation is, “Due to the insolence of the board, many top-notch officials have left the bank. When I was the director in the Bank between 2013-18, many new recruitments used to be done for various posts including that of Customer Service Officer and Customer Service Representative every year but, in the last five years, no recruitment has been made”. This too is a baseless allegation.
SVC Bank employs professionally qualified candidates with rich experience, especially at the Senior Management level. The movement of Senior Management professionals is quite natural, given that in such a competitive environment, many career growth opportunities are available in the banking industry for the caliber of candidates employed by the Bank. The recruitment of manpower in the Bank is done as per the business requirements of the Bank. Accordingly, along with other positions, the Bank has also hired Customer Service Officers and Customer Service Representatives in the Bank, as per requirement. It is a blatant lie that there has been no recruitment for the said positions in the last 5 years.
4. The fourth issue highlighted by Mr. Pagare is of grave concern to the Bank. He quotes, “Somewhere in 2006, SVC Bank had taken over the Maharashtra based Mahavir Cooperative Bank and at that time the board assured the shareholders to give their money back but still shareholders are running from pillar to post to get back their shares” and “There are around 25k shareholders who were associated with Mahavir Co-op bank and a share capital worth of over Rs 5.5 crore. Neither bank is paying dividend to them nor has given them the voting rights”.
This needs to be seen in the right context of the case. The Reserve Bank of India vide its order dated 09.06.2006, and the Registrar of Co-operative Societies vide it’s Order dated 21.07.2006, approved the merger of Shri Mahavir Co-operative Bank Ltd. (SMCB) with The Shamrao Vithal Co-operative Bank Ltd. (now known as SVC Co-operative Bank Ltd.). SMCB had failed in all indicators of economic viability and was therefore bound to be liquidated if there was no proposal for amalgamation. SMCB had flouted all prudential norms of banking, which had resulted in huge NPAs, high staff costs arising out of indiscriminate overstaffing, lack of banking expertise, lack of commitment to the business, lack of control on credit management, negative capital adequacy, high cost of deposits, mismanagement, etc. SMCB’s accumulated loss was Rs.13.35 crore and had no future other than absolute closure. SVC Bank paid all the depositors and accommodated the employees of erstwhile SMCB, some of whom have honourably retired from SVC Bank, and some of the employees are still happily working with SVC Bank.
At the time of the merger, as per terms of amalgamation, it was decided that SVC Bank would maintain the record of accounts of SMCB and all its branches for 10 years and repay the share capital amounting to Rs.1.74 crores to the shareholders, only if the accumulated losses of SMCB are recovered. Accordingly, after 10 years the Bank appointed an independent CA firm M/s Sanjay Rane and Associates to audit the records of SMCB. The firm, vide its report dated 06.03.2017 certified, that the losses of SMCB have not fully been recovered, and there was continuing loss of Rs.7.05 crores. Hence, as per the terms and conditions of the merger order, the shareholders are not eligible to receive their share capital money, as the losses incurred have yet to be fully compensated.
The Bank had already initiated legal action against Mr. Ravi Pagare for infringement of the Bank’s registered trademarks and copyrights in the Bombay High Court. The matter is now scheduled for a hearing on July 12, 2023. An FIR has also been registered against Mr. Ravi Manohar Pagare in this regard. The Bank has also lodged criminal complaint against Mr. Ravi Manohar Pagare for trespassing, criminal intimidation, etc. at Vishrambaug Police Station, Sangli, for forcibly entering the Bank’s premises at Sangli Branch after office hours. The Police has taken cognizance of the said complaint and filed an FIR bearing no.413/2923 against Mr. Ravi Manohar Pagare and Mr. Raygonda Bhupal Patil.
Mr. Durgesh Chandavarkar, Chairman of SVC Co-operative Bank Ltd. clarified that he does not prefer to answer calls from unknown numbers. However, if he would have received a message about the purpose of calls being made to him, he would have definitely responded.
The Election to the Board of Directors scheduled on June 04, 2023, will be conducted across 102 Polling Centres with 125 Polling Booths across the branches of the Bank in India.
To ensure that these allegations are not hurting the Bank’s credibility, we would request that you add the Bank’s statements on each of the four points raised by Mr. Pagare to the present story.
The letter is signed off by Ravinder Singh, Managing Director, SVC Co-operative Bank.