MIRA INFORM REPORT
|
Report Date : |
06.11.2014 |
IDENTIFICATION DETAILS
|
Name : |
TAMILNAD MERCANTILE BANK LIMITED |
|
|
|
|
Registered
Office : |
57, Victoria Extension Road, Thoothukudi – 628002, Tamilnadu |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as
on) : |
31.03.2014 |
|
|
|
|
Date of
Incorporation : |
11.05.1921 |
|
|
|
|
Com. Reg. No.: |
18-001908 |
|
|
|
|
Capital Investment
/ Paid-up Capital : |
Rs. 2.845
Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
U65110TN1921PLC001908 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MRIT00533B/ MRIT01537E/ MRIT01177B/ CHET01129C |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACT5558K |
|
|
|
|
Legal Form : |
Public Limited Liability Bank. |
|
|
|
|
Line of Business
: |
Subject is engaged in banking activities. |
|
|
|
|
No. of Employees
: |
Information Decline by the management |
RATING & COMMENTS
|
MIRA’s Rating : |
A (63) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 710000000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Exist |
|
|
|
|
Comments : |
Subject is a well-established and reputed bank having fine track. The rating reflects sound financial risk profile supported by adequate
capitalization and decent profitability of the bank. Trade relations are reported as fair. Business is active. Payments are
reported to be regular and as per commitments. The bank can be considered good for normal business dealings at usual
trade terms and conditions. |
NOTES:
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – June 1, 2014
|
Country Name |
Previous Rating (31.03.2014) |
Current Rating (01.06.2014) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
INDIAN ECONOMIC OVERVIEW
N E W S
Verdict Implications
: Apex court order may alter coal import dynamics. Traders go slow on talks
over coal supply contracts, uncertainty over cancellation of blocks weigh on
stocks.
Recent arrest of the
Chennai head of the Registrar of Companies, the ministry of corporate affairs
arm that ensures that companies file all the information required by the
Companies Act is the latest manifestation of a messy fight between a father and
his adopted son for the control of Rs 40000 mn business empire. The Central
Bureau of Investigation arrested Manumeethi Cholan after he accepted Rs 10
lakhs as bribe from M A M Ramaswamy, a CBI official said.
Central Bureau of
Investigation books Electrotherm for cheating Central Bank of Rs 4360 mn.
Infosys maintains
revenue guidance. COO Rao says attrition still an area of concern and it would
take a few more quarters to bring down levels to 13-15 %.
DHL to invest
Euro 100 mn in India over next 2 years. The firm has chosen India to pilot its
e-commerce business model for the Asia-Pacific region.
Blackstone may buy
stake in BlueRidge SEZ in line with the fund’s real estate strategy in India.
Kingfisher Airlines
Ltd grounded in October 2012 under the weight of heavy debt and accumulated
losses, recently approached the Delhi high court for relief in two separate
cases. The airline challenged a notice by Punjab & National Bank alleging
that It had wilfully defaulted on Rs 7700 mn of loans and sought more time to
comply with the requirements under the listing agreements with the Stock
Exchanges.
OnMobile likely to
sack another 300 employees. The lay-offs follow a spate of senior-level exits
over the past two years, starting with of its founder. The overall lay-offs
could number around 600 and are driven by the need to cut costs, says a former
employee.
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CRISIL |
|
Rating |
Certificate of deposits = “A1+“ |
|
Rating Explanation |
Very strong degree of safety and lowest
credit risk. |
|
Date |
14.11.2013 |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2014.
INFORMATION DENIED
Management non-cooperative (Tel. No.: 91-461-2321929)
LOCATIONS
|
Registered Office : |
57, Victoria Extension Road, Thoothukudi – 628002, Tamil Nadu, India |
|
Tel. No.: |
91-461-2321382 /2321929 / 2321932 /2321971 / 2325381 /2325831 |
|
Fax No.: |
91-461-2322994 |
|
E-Mail : |
|
|
Website : |
DIRECTORS
AS ON 31.03.2014
|
Name : |
Mr. Upendra Hosdurg Sundar Kamath |
|
Designation : |
Managing director |
|
Address : |
Anugraha, House No. 1363, Opposite Rajashekar Hospital, 9th Cross Road, J P Nagar - 1st Phase, Bangalore – 560078, Karnataka, India |
|
Date of Appointment : |
09.07.2014 |
|
DIN No.: |
02648119 |
|
|
|
|
Name : |
Mr. Srinivasan Sundar |
|
Designation : |
Director |
|
Address : |
2, ‘B’ Sahas Manor, 3C, III Street, North Boag Road, T. Nagar, Chennai - 600 017, Tamilnadu, India |
|
Date of Birth/Age : |
15.05.1942 |
|
Date of Appointment : |
06.01.2010 |
|
DIN No.: |
00115315 |
|
|
|
|
Name : |
Mr. Balkrishnan Prabhakaran |
|
Designation : |
Additional director |
|
Address : |
4/3A, Kasthuribai Road, Virudhunagar – 626001, Tamilnadu, India |
|
Date of Birth/Age : |
08.07.1955 |
|
Date of Appointment : |
16.04.2011 |
|
DIN No.: |
00209875 |
|
|
|
|
Name : |
Mr. Vikraman Nithayanandham |
|
Designation : |
Director |
|
Address : |
2/3C /12, Ganesh Nagar, Thoothukudi-628008, Tamilnadu, India |
|
Date of Birth/Age : |
11.04.1953 |
|
Date of Appointment : |
26.11.2009 |
|
DIN No.: |
00466250 |
|
|
|
|
Name : |
Mr. Pandian Mahendravel |
|
Designation : |
Director |
|
Address : |
99, A17, Lakshmi Sundaram Enclave, Sammattipuram, Usilampatti Road, Madurai - 625 010, Tamilnadu, India |
|
Date of Birth/Age : |
14.03.1961 |
|
Date of Appointment : |
26.11.2009 |
|
DIN No.: |
00688302 |
|
|
|
|
Name : |
Mr. Yesuthasen Pathiudian |
|
Designation : |
Additional director |
|
Address : |
4B, Cross Street, Sri Nagar Colony, Chennai - 600 015, Tamilnadu, India |
|
Date of Birth/Age : |
22.04.1946 |
|
Date of Appointment : |
16.04.2011 |
|
DIN No.: |
00767702 |
|
|
|
|
Name : |
Mr. Shanmugam Rajendran Aravindkumar |
|
Designation : |
Director |
|
Address : |
45, New Colony, Thoothukudi - 628 003, Tamilnadu, India |
|
Date of Birth/Age : |
12.04.1973 |
|
Date of Appointment : |
26.11.2009 |
|
DIN No.: |
02145836 |
|
|
|
|
Name : |
Mr. Subbunadar Chandrasekar |
|
Designation : |
Director |
|
Address : |
No.19, White House, Thambhusamy Road, Kilpauk, Chennai - 600 010, Tamilnadu, India |
|
Date of Birth/Age : |
23.12.1955 |
|
Date of Appointment : |
26.11.2009 |
|
DIN No.: |
02174506 |
|
|
|
|
Name : |
Mr. Thangavel Rajakumar |
|
Designation : |
Additional Director |
|
Address : |
No.18. Rajagardens, Kottivakkam, Chennai – 600041, Tamil Nadu, India |
|
Date of Appointment : |
29.11.2013 |
|
DIN No.: |
02659409 |
|
|
|
|
Name : |
Mr. Thirukumar Vethanayagam |
|
Designation : |
Additional director |
|
Address : |
M/s. Bloom Energy (India) Private Limited, Plant 19A, Godrej and Boyce Mfg. Co., L.B.S. Marg, Vikhroli (W), Mumbai - 400 079, Maharashtra, India |
|
Date of Birth/Age : |
03.12.1958 |
|
Date of Appointment : |
16.04.2011 |
|
DIN No.: |
02873163 |
|
|
|
|
Name : |
Mr. Shidambaranathan Arumugasami |
|
Designation : |
Additional director |
|
Address : |
6 Javuli Kadai Street, Sivakasi – 626123, Tamil Nadu, India |
|
Date of Appointment : |
21.10.2011 |
|
DIN No.: |
02904738 |
|
|
|
|
Name : |
Mr. Kaippilly Narayanan Rajan |
|
Designation : |
Nominee Director |
|
Address : |
B-1, Kaippilly, Ullas Nagar, Peroorkada, Trivandrum - 695 005, Kerala, India |
|
Date of Birth/Age : |
01.10.1951 |
|
Date of Appointment : |
11.01.2010 |
|
DIN No.: |
02963834 |
|
|
|
|
Name : |
Mr. Rajan Valappil Kiliyam |
|
Designation : |
Nominee Director |
|
Address : |
Block 5A, Flat No.101, Hansa Chitra Aptment, 91, Darga Road, Pallavaram, Chennai - 600 043, Tamilnadu, India |
|
Date of Birth/Age : |
10.05.1950 |
|
Date of Appointment : |
11.07.2010 |
|
DIN No.: |
03184355 |
KEY EXECUTIVES
|
Name : |
Mr. Deepak C Sankunni |
|
Designation : |
Secretary |
|
Address : |
27/4/1, Muniyasamypuram, 2nd Street, Tuticorin – 628002, Tamil Nadu, India |
|
Date of Appointment : |
25.01.2012 |
|
PAN No.: |
AUSPS1636A |
MAJOR SHAREHOLDERS
Shareholders are Not Available
BUSINESS DETAILS
|
Line of Business : |
Subject is engaged in banking activities. |
GENERAL INFORMATION
|
No. of Employees : |
Information declined by the management |
||||||||||||||||||||||||
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|
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|
Bankers : |
Reserve Bank of |
||||||||||||||||||||||||
|
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|
||||||||||||||||||||||||
|
Facilities : |
|
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Suri and Company Chartered Accountants |
|
Address : |
No.4, Chevalier Sivaji Ganesan Road, Thyagarayanagar, Chennai –
600017, Tamilnadu, India |
|
PAN No.: |
AABFS5023Q |
CAPITAL STRUCTURE
AS ON 31.03.2014
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
10000000 |
Equity Shares |
Rs.10/- each |
Rs.100.000 Millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
284454 |
Equity Shares |
Rs.10/- each |
Rs. 2.845
Millions |
|
|
|
|
|
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
2.845 |
2.845 |
2.845 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
22693.122 |
20217.928 |
16345.598 |
|
|
4] Deposits |
226456.831 |
202238.111 |
171104.399 |
|
|
NETWORTH |
249152.798 |
222458.884 |
187452.842 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2595.817 |
2505.824 |
4606.733 |
|
|
2] Unsecured Loans |
0.000 |
0.000 |
0.000 |
|
|
TOTAL BORROWING |
2595.817 |
2505.824 |
4606.733 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
251748.615 |
224964.708 |
192059.575 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1168.840 |
999.197 |
775.261 |
|
|
Capital work-in-progress |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
67718.908 |
53482.721 |
48902.678 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Balance with Banks and Money at call and short Notice |
3764.941
|
2672.829
|
284.727
|
|
|
Cash & Bank Balances |
10339.027
|
9176.640
|
6960.762
|
|
|
Other Current Assets |
9552.129
|
7951.945
|
8380.091
|
|
|
Loans & Advances |
171438.500
|
162559.900
|
137788.627
|
|
Total
Current Assets |
195094.597
|
182361.314
|
153414.207
|
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Other Current Liabilities |
12233.730
|
11878.524
|
11032.571
|
|
|
Provisions |
0.000
|
0.000
|
0.000
|
|
Total
Current Liabilities |
12233.730
|
11878.524
|
11032.571
|
|
|
Net Current Assets |
182860.867
|
170482.790
|
142381.636
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
251748.615 |
224964.708 |
192059.575 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income (Interest Earned) |
27026.551 |
24703.687 |
18823.916 |
|
|
|
Other Income |
2201.341 |
2487.173 |
2316.580 |
|
|
|
TOTAL |
29227.892 |
27190.860 |
21140.496 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Operating Expenses |
4892.626 |
4185.299 |
3490.412 |
|
|
|
Provision and Contingencies |
3122.780 |
2494.309 |
2195.305 |
|
|
|
TOTAL |
8015.406 |
6679.608 |
5685.717 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST AND TAX |
21212.486 |
20511.252 |
15454.779 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES |
18204.817 |
16108.423 |
12320.189 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX |
3007.669 |
4402.829 |
3134.590 |
|
|
|
|
|
|
|
|
|
Less |
TAX |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX |
3007.669 |
4402.829 |
3134.590 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
11.272 |
5.052 |
9.562 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to Statutory Reserve |
902.500 |
1321.000 |
941.000 |
|
|
|
Transfer to Other Reserve |
1300.000 |
2360.000 |
1620.000 |
|
|
|
Transfer to Investment reserve |
7.400 |
40.110 |
31.800 |
|
|
|
Transfer to Investment reserve |
0.000 |
0.000 |
100.000 |
|
|
|
Transfer to Special reserve |
238.000 |
145.000 |
0.000 |
|
|
|
Interim Dividend & Dividend tax paid |
299.517 |
297.540 |
297.500 |
|
|
|
Interim Dividend payable |
199.118 |
128.004 |
0.000 |
|
|
|
Tax on Interim Dividend |
33.840 |
21.755 |
0.000 |
|
|
|
Proposed Dividend |
0.000 |
71.114 |
128.000 |
|
|
|
Tax on Dividend |
0.000 |
12.086 |
20.800 |
|
|
BALANCE CARRIED
TO THE B/S |
38.566 |
11.272 |
5.052 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
10573.00 |
15478.00 |
11020.00 |
|
KEY RATIOS
|
PARTICULARS |
|
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
Net Profit Margin PAT / Sales |
(%) |
11.13 |
17.82 |
16.65 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
1.53 |
2.40 |
2.03 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.01 |
0.02 |
0.02 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt /Networth) |
|
0.01 |
0.01 |
0.02 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
21.58 |
19.94 |
18.41 |
FINANCIAL ANALYSIS
[all figures are
in Rupees Millions]
DEBT EQUITY RATIO
|
Particular |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
Rs.
In Millions |
Rs.
In Millions |
Rs.
In Millions |
|
Share Capital |
2.845 |
2.845 |
2.845 |
|
Reserves & Surplus |
16345.598 |
20217.928 |
22693.122 |
|
Deposits |
171104.399 |
202238.111 |
226456.831 |
|
Net
worth |
187452.842 |
222458.884 |
249152.798 |
|
|
|
|
|
|
Secured Loans |
4606.733 |
2505.824 |
2595.817 |
|
Unsecured Loans |
0.000 |
0.000 |
0.000 |
|
Total
borrowings |
4606.733 |
2505.824 |
2595.817 |
|
Debt/Equity
ratio |
0.025 |
0.011 |
0.010 |
YEAR-ON-YEAR GROWTH
|
Year
on Year Growth |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
Rs.
In Millions |
Rs.
In Millions |
Rs.
In Millions |
|
Sales |
18823.916 |
24703.687 |
27026.551 |
|
|
|
31.236 |
9.403 |
NET PROFIT MARGIN
|
Net
Profit Margin |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
Rs.
In Millions |
Rs.
In Millions |
Rs.
In Millions |
|
Sales
|
18823.916 |
24703.687 |
27026.551 |
|
Profit |
3134.590 |
4402.829 |
3007.669 |
|
|
16.65% |
17.82% |
11.13% |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info Agents |
Available in
Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
No |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact
person |
No |
|
11] |
Turnover of firm for last
three years |
Yes |
|
12] |
Profitability for last
three years |
Yes |
|
13] |
Reasons for variation
<> 20% |
----------- |
|
14] |
Estimation for coming
financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister
concerns |
No |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details
(if applicable) |
No |
|
21] |
Market information |
---------- |
|
22] |
Litigations that the firm
/ promoter involved in |
Yes |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking
account |
---------- |
|
26] |
Buyer visit details |
---------- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if
applicable |
Yes |
|
29] |
Last accounts filed at
ROC |
Yes |
|
30] |
Major Shareholders, if
available |
Yes |
|
31] |
Date of Birth of
Proprietor/Partner/Director, if available |
Yes |
|
32] |
PAN of
Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of
Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating,
if available |
Yes |
GENERAL:
The financial statements have been prepared on ongoing concern concept, historical cost convention and conform to statutory provisions and practices prevailing within the banking industry. The items of income and expenditure are taken on accrual basis except where specifically stated and it conforms to the guidelines issued by Reserve Bank of India (RBI) for banks.
The preparation of financial statements requires the management to make estimates and assumptions in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of the financial statement and the reported income and expenses during the reporting period. Management believes that the estimates and assumptions used in preparation of the financial statements are prudent and reasonable. Actual results could differ from these estimates.
NO CHARGES EXIST FOR COMPANY.
LITIGATION
DETAILS:
|
STATUS INFORMATION SYSTEM |
|
|
WP 25917 / 2011 WPSR
138493 / 2011 CASE
IS: PENDING |
|
|
|
|
|
PETITIONER |
RESPONDENT |
|
|
|
|
M/S. DASAM DIARY AND ANO. VS A.O., TAMILNAD MERCANTILE BANK LTD.,
HYD & ANO. |
|
|
|
|
|
PET.ADV.: RADHA KRISHNA |
RESP.ADV.: PATURU MADHUSUDHANA KUMAR |
|
SUBJECT: NATIONALISED BANKS (MISC. MATTERS) |
DISTRICT: KRISHNA |
|
|
|
|
FILING DATE : 14.09.2011 POSTING STAGE: FOR ADMISSION |
|
|
REG. DATE : 15.09.2011 LISTING DATE: 16.09.2011
STATUS : ADMIT |
|
|
|
|
|
HON’BLE JUDGE(S)
: N.V. RAMANA P. DURGA PRASAD |
|
PRESS RELEASE:
TMB AIMS TO ACHIEVE RS 1 LAKH CRORE TURNOVER IN NEXT FOUR YEARS
COIMBATORE:
Aiming to become a pan-India entity, Tamil Nadu Mercantile
Bank (TMB) plans to have
800 branches from the existing 383 in six states in the next four years,
targeting a business turnover of Rs 1 lakh crore, a top bank official said
today.
The bank
expects to have a business turnover (both advances and deposits) of Rs 50,000
crore this fiscal and after ramping up the branches, the turnover would touch
Rs 1 lakh crore, H S Upendra Kamath,
Managing Director and CEO of TMB told reporters here.
In the first phase, branches
would be added to the existing states of Tamil Nadu, Puducherry, Kerala,
Karnataka, Andhra Pradesh, Telangana, Maharashtra and Gujarat in another 15 to
18 months, while states in the West, North and East would be covered in the
remaining two and half years, Kamath said.
To lend to corporates in a big
way, TMB would set up cells in major cities including Mumbai, Delhi, Chennai, Coimbatore, Hyderabad and Bengaluru in another 45 days, he said.
Similarly, to reduce the time for
clearing loans, the bank has set up centralised loan processing cells in a few
cities, including Coimbatore, he said.
Stating that TMB has 15 per cent
Capital Adequacy Ratio and there was no need to raise capital at the moment,
Kamath said that as we go forward it would be considered.
On Non-Performing Assets (NPA),
the official said the gross NPA was 2.6 per cent in 2013, to the tune of Rs 380
crore, far below the national average of 4 to 4.5 per cent.
To a question on complaints of
not holding Annual General Meetings (AGM), Kamath admitted that AGMs were not
conducted for the last four years due to "some internal issues" and
said once these were solved, "the bank will try to call it at the
soonest."
TAMILNAD MERCANTILE BANK SET FOR IPO
TAMILNAD MERCANTILE BANK (TMB) is in transition. With brand-building efforts, a new
managing director and chief executive officer, the bank expects to go for an
initial public offering (IPO) soon.
However,
its timing can only be decided once the court tells the annual general meet
date. The lender is planning to seek shareholders' approval for the IPO at the meet.
The legal tangle is due to a fight over management control betweenSivanthi Adityan and
brother Ramachandran Adityan.
Nagendra Murthy, who took over as MD and CEO
this month, said: "We are almost ready for an IPO. Paperwork,
brainstorming and groundwork have been done. As soon as the meet date is
announced, a decision on whether to go in for a dilution, an offer for sale
will be taken. Beyond this, I cannot comment."
The Tuticorin-based lender, set up in the
1920s, will continue to be conservative, but will target young customers, he
said.
"The
main focus will be on improving low-cost deposit, which was not the focus for
the last few years. Improving CASA(current account, savings account) will help the bank
bring down interest rate for borrowers, and will also help improve
profitability."
Tamilnad Mercantile Bank, predominantly
community-based, was set up to finance the needs of the trader community of Nadars.
The new MD said the tag might not be suitable now. "It is appropriate to
say the bank was founded by a community, but it is not run by, or dependent on
it, any more. None of the MDs and CEOs in the recent past were from the
community.”
Today, the top five borrowers are not from
the community and today the bank has started recruiting people from the north
for their respective state branches."
Murthy refused to disclose the holding
pattern of the bank, which has been in the midst of the ownership tussle
between the two groups. "The matter is subjudice and also with the
regulator. I cannot comment on anything related to the board." But he said
the issue has held up the annual general meeting, and important decisions such
as share sale and dividend.
The bank had reported 24.93 per cent growth
in net profit at Rs 313.46 crore in 2011-12 and has set a target of Rs 5000.000
Millions by 2015 with business of Rs 62,0000.000 Millions and compound annual
growth rate (CAGR) of 30 per cent.
"This
year we want to close with total business of Rs 40,000 crore and profit of Rs
4000.000 Millions, as against Rs 32,2290.000 Millions and Rs 3134.600 Millions,
respectively, in 2011-12. The long-term target (in two and a half years) is
total business of Rs 50,0000.000 Millions, in other words CAGR of 30 per
cent.
"Though it will be challenging, we are
optimistic and confident we can achieve our goals," the managing director
said.
"The bank aims to have one per cent of
total business as net profit and increase in net interest income by 20 per cent
every year."
MADRAS HC RESTRAINS FIIS FROM VOTING IN TAMILNAD MERCANTILE BANK
The Madurai
Bench of Madras High Court today gave an interim injunction, which will take away
the powers of Foreign Institutional Investor (FIIs) to vote in any of the
meetings of the Tamilnad Mercantile Bank (TMB).
The FIIs, who held shares in TMB include
Ramesh Vangal, Former Mckinsey Chief Rajat Gupta. They were also on the race to
take over control of the 92-year old Tuticorin-based TMB, set up by Nadar
community.
The order, copy of which is available with
Business Standard, was based on RBI's Amendment in Section 12 B(3) of the
Banking Regulation Act, 1949.
The court noted, that the RBI has declined to acknowledge the holding of five% or
more of the paid up capital of the TMB by the Group, consisting of the
respondents (FIIs). In view of the refusal to acknowledge the holding of shares
by the FIIs, the Bank should be directed not to give effect to the transfer of
shares and in case, the transfer has been registered, the transferee shall not
be entitled to exercise voting rights on poll, as per the RBI's Regulation.
Quoting the RBI's regulation, the court stated,
"In view of the above, there shall be an order of interim injunction as
prayed for.”
When contacted Ramesh Vangal was not
available for comment.
The court's order was in response to a
petition which sought an injunction restraining the Bank from permitting any
voting rights based on the acknowledged shares transfered in contravention to
Section 12B (3) of theBanking Regulation Act as declared by the order of the Reserve Bank of India.
The petition was filed by TMB's founder's
son P S P K Maragathraapandian, who is 75 years old now.
The order will restrain FIIs, who are
holding 93,563 shares or 30% of the the Bank's shareholding, from voting in any
of the meetings of the TMB. It may be noted, in the next 5-6 months the Bank is
expecting that it may conduct an AGM, during which some of the important
resolutions are expected to be tabled. These includes nod for IPO, dividend
payout and others.
Total shares in the privately held Bank is
2,84,454 shares of which FIIs holds 1,12,151 shares in escrow accounts of a
private Bank in Mumbai and Mauritius. These shareholding constitute to 40% of
the total shareholding of the Bank. It was said shares of the Bank was quoted
at around Rs 80,000 a share in a private market.
In 2007, FIIs came on Board, Nadar
community led by B Ramachandra Adityan and MGM Maran signed an agreement with
the Sterling group to buy the 95,418 shares held by the group for a
consideration of around Rs 166 crore. This was the first time that shares have
been transferred — on books — to members of the non-Nadar community, which has
sparked off protests and a legal battle in the past.
The investors were led by Ramesh Vangal
(Katra Holdings) (10,364 shares or 3.64% stake), Rajat Gupta (14,080, 4.95%),
Ravi S Trehan (2,845, 1%), Kamehameha Mauritius (2025, 0.71%), Cuna Group
Mauritius (2,025, 0.71%), FI Investments Mauritius, (5,399, 1.90%), Swiss Re
Investors (10,124, 3.56%).
The non-Nadar Indian investors include
Gokul Patnaik (10,589, 3.72%) and Vector Program (13455, 4.73%) came on board
and these investors paid Rs 24,182 a share to pick up a 24.93% stake. These
shares were bought from four companies belonging to NRI businessman C
Sivasankaran's Sterling Group.
It is interesting to note in 2007 the six
foreign and two Indian investors, who picked up the stake in TMB, paid nearly four
times more than what B Ramachandra Adityan, MGM Maran and other members of the
Nadar community shelled out for their eight% stake.
The higher price paid by the foreign and
the two Indian investors could be seen as a 'premium' for not belonging to the
Nadar community, said an analyst, who have been tracking the Bank for over a
decade now.
Sources in the Board said that the FIIs
have infused around Rs 1660.000 Millions in the Bank and they bailed out the
community. Today the investment of these FIIs have grown by three times, said
the source.
MB BANKS ON PUBLIC FLOAT FOR GROWTH
Tuticorin, one of the driest parts of the
country, 540 km south-west of Chennai, has been in the eye of a storm for over
15 years as various interest groups, including some big corporate houses, fight
to take control of the 92-year-oldTamilnad Mercantile Bank (TMB).
Among those who have shown interest in
acquiring the bank, set up by the Nadars to serve their community, include the
Ruias-the promoters of the Essar group- maverick businessmen C Sivasankaran and
Ramesh Vangal, former Mckinsey chief Rajat Gupta and some people from the Nadar
community itself.
These suitors, drawn by the bank's robust
performance, have also caused legal cases to pile up. TMB's shareholding
pattern is under dispute with several cases being fought by the bank in courts
across the country. But despite the legal hassles which have hobbled its growth
plans, the bank is now looking to the future. The privately-held bank is
readying for an initial public-offering (IPO) that should enable it to expand
beyond Tamil Nadu.
The bank's conservative holding, while ensuring
that its financials remained robust, has come in the way of its expansion
plans. It was denied permission by the Reserve Bank of India to open branches in the metro cities because of its legal trouble and
lack of public equity. As a result, TMB has in recent years lost out to
competition. For instance, the market for low-cost current account and savings
account (CASA) deposits is there only in the metros; so, its cost of funds is
higher than other banks. TMB's pay-out ratio, or the earnings paid as dividend
to shareholders, at 11 per cent is also below other banks like Karur Vysa Bank,
City Union Bank and others (17-25 per cent).
About 10 years back, TMB used to be the
benchmark in terms of revenue generated per employee and employee productivity,
says one of the board members, but Karur Vysa Bank has overtaken it in the last
four to five years. Again, experts say, it is because TMB is going "rather
slow on expansion."
At a time when other banks were expanding
aggressively, TMB, hemmed in by its own limitations, had to be content with
being only a state player. In 2009, TMB had 213 branches and only three new
branches were added in the whole of 2010. That too came up in Tier II and III
cities that do not require RBI permission.
TMB officials say RBI's reservations have
also brought some advantages for the company. The bank has said that going
forward, the future would be in Tier II to VI cites as the metros are getting
saturated. Also, with income level and prosperity of people in non-metros
rising, the bank is set to benefit as it has the first-mover advantage, says K
B Nagendra Murthy, managing director and chief executive officer of TMB.
However, the bank will have to contend with
another issue before the IPO can be floated: resolve its legal cases which came
along as the bank grew in stature. Cobbled together in 1921 by a few
influential people from the Nadar community, the bank soon acquired a
reputation of being a one-stop shop to meet all the requirements of the Nadars:
when a young man from the community wanted to set up a business, TMB gave him
the capital; if he wanted to take up a job, the bank turned into his employer.
These measures, while ensuring the bank was never short of business, also made
it hugely successful. It started reporting profit from the very first year of
its operations: Rs 6,9840.000 Millions in 1921, Rs 0.505 Millions in 1971 and
Rs 4400.000 Millions as of last year.
The bank's performance has been the envy of
others. Despite all the shortcomings -lack of a strong board and no capital
dilution- the bank has a net worth of Rs 1,8000.000-1,9000.000 Millions on a
paid-up capital of only Rs 2.600 Millions. It is also among the few banks with
a high reserve base and the only bank in India to consistently declare higher
than average revenue.
TMB declared a dividend of 6 per cent in 1921
(first year of operations) and since then rate of dividend has increased
manifold. It announced a dividend of 1,000 per cent in 2005-06 and 2006-07. The
dividend proposed for 2007-08 was 5,000 per cent and an interim dividend of
9,000 per cent was announced in October 2011. Last year, the bank's dividend
payout was 16,000 per cent. A major chunk of the dividends, however, has not
been paid because the bank has not been able to hold its AGM for the last four
years due to legal hassles. The bank's share price (in the private market) has
been quoted at around Rs 63,000, says an analyst.
With such robust performance, TMB has
always had a steady stream of suitors and, as an accompaniment, legal troubles.
It all started in 1994 when the Essar group quietly bought the stake of some influential Nadar
groups in the bank. A legal battle has been going on ever since as the Nadar
community is fiercely protective of the bank and does not want outsiders to
stake claim to what its considers a community organisation. To buy back the
shares, the community floated the Nadar Mahajan Bank Share Investors Forum to
pool in money. Some influential businessmen-C Sivasankaran and foreign institutional
investors (FIIs)-too pitched in with funds to help the community in return for
a place on the board.
Sources in the board say that the FIIs have
infused around Rs 1500.000 Millions in the bank in order to bail out the
Nadars. Today, the investment of these FIIs has grown three times, says the
source. The current status of the board is not clear and the legal battles
between various stakeholders are still going on in various courts.
A senior official from the bank says that
the board expects the court cases would get over in four or five months and the
IPO will follow within two months after that. TMB has appointed SBI Caps as the
advisor for the IPO. In the meantime, the bank has proposed to go for a bonus
issue to bring down its share price since the current price (Rs 63,000 apiece)
is too high for investors.
An IPO will definitely help the bank in
widening its presence, and as the locals says, "All they need to do now is
to end the infighting."
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or investigation
registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.39 |
|
|
1 |
Rs.98.00 |
|
Euro |
1 |
Rs.76.99 |
INFORMATION DETAILS
|
Information
Gathered by : |
NYA |
|
|
|
|
Analysis Done by
: |
SUB |
|
|
|
|
Report Prepared
by : |
NKT |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
YES |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
NO |
|
--LISTED |
YES/NO |
NO |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
|
|
|
|
TOTAL |
|
63 |
This score serves as a reference to assess
SC’s credit risk and to set the amount of credit to be extended. It is calculated
from a composite of weighted scores obtained from each of the major sections of
this report. The assessed factors and their relative weights (as indicated
through %) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment record
(10%)
Credit history
(10%) Market trend (10%) Operational size
(10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NB |
NEW BUSINESS |
||
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.