The L&T's board of directors has decided to bifurcate the roles of chairman and managing director in a major top management rejig, which would become effective from 1 April 2012.
In a long-awaited top management succession planning exercise, corporate giant Larsen and Toubro appointed K Venkataraman as its CEO and managing director, while its current chief A M Naik would remain executive chairman for the next five years.
Naik currently holds the position of chairman and MD at the group, a major player in engineering, manufacturing, construction and a host of other businesses including technology and financial services. The L&T's board of directors has decided to bifurcate the roles of chairman and managing director in a major top management rejig, which would become effective from 1 April 2012.
As per the new structure, Venkataraman would assume the position of chief executive officer and MD, while Naik would assume the post of executive chairman.
Venkataramanan is currently whole-time director and president (hydrocarbon) and had joined L&T as a graduate engineer trainee in 1969. He was elevated to L&T Board in the year 1995.
"I am pleased that the board has appointed K Venkataraman as CEO and MD. I have full confidence that under Venkataraman's leadership, L&T will continue on its growth path," Naik said.
While Venkataramanan would be responsible for the businesses of L&T, Naik would focus on completing the portfolio restructuring, institutionalising the IC (independent company) structure, mentoring and developing the leadership team and future leaders, the group said.
Accordingly, the board decided that there was a need for continuity and requested Naik to continue for a period of five years as executive chairman of the Group.
"I am honoured with the responsibility that the board has placed on me. I am also happy that A M Naik's guidance will continue to be available," Venkataraman said.
With instances of recovery agents harassing bank customers continuing unabated, banks need to take care in choosing and recruiting recovery agents
A recent report published by the Reserve Bank of India (RBI) on Banking Ombudsman (BO) reveals that out of 71,124 complaints it received during 2010-11, 1,722 or 2% related to direct selling and recovery agents. Some cases indicate that customers are unnecessarily victimised by the banks and had to suffer the tortures of the recovery agent, the report said. It reveals the series lapses in the KYC (Know Your Customer) procedures followed by the banks.
Take the case of Ankit (name changed). Despite having no credit cards, he was receiving frequent calls from his banks for the recovery of the dues on his card. Ankit complained to the bank. However no action was taken and calls continued at odd hours. He approached BO. During the hearing, the bank accepted the mistake saying that the defaulting credit card holder and the complainant had the same name. The BO held bank negligent in initiating the recovery measures and directed it to pay Rs5,000 to Ankit as compensation for harassment and metal anguish he had to go through.
Similarly, according to the report, another complainant Vivek (name changed) had to go through even more harrowing experience. Vivek was harassed by the abusive calls of bank’s recovery agents to pay the loan which he had never availed. He was unrelated to the bank. The ordeal was such that he fell ill and had to get operated for a heart problem. Even in the ICU, the calls continued. A complaint was lodged with the BO. At the hearing, the bank said that phone number from where Vivek was getting the calls did not belong to their recovery agents. The case was closed.
Vivek then appealed to the Appellate Authority (AA) against the bank for the trauma he had to go through and for misguiding the BO. Interestingly at the AA, the bank admitted that the calls belonged to its recovery agent. It explained that such repetitive calls were due to lack of communication and data issues with their outsourced collection agency. It was also revealed that bank did not complete the KYC formalities before sanctioning the loan and the borrower remained unknown and untraceable. The AA observed that bank sanctioned the loan without even cross checking the validity of the number and it misguided the BO. The authority awarded a compensation of Rs1 lakh to Vivek.
The apex bank had laid guidelines to be adhered by the banks’ recovery agents. However, experts point out the need for recruiting trained recovery agents. “Banks should engage trained agents to recover the money, as it is important to deal with debtors with ‘humaneness’,” GS Hegde, RBI’s principal legal adviser, was quoted saying by PTI.
So, if you get such abusive call do approach the banking ombudsman.
Axis Income Fund new fund offer closes 21st March.
Axis Mutual Fund has launched Axis Income Fund, an open-ended income scheme.
The investment objective of the scheme is to generate optimal returns in the medium term while maintaining liquidity of the portfolio by investing in debt and money market instruments.
The new issue closes on 21 March 2012. The minimum investment amount is Rs5000.
CRISIL composite bond fund index is the benchmark index. R Sivakumar and Ninad Deshpande are the fund managers.