JAIPUR, NOV 11: The Reserve Bank has removed Keshav Bangur, former deputy chairman of Bank of Rajasthan, and his father S N Bangur from the board of directors of the private sector bank for a period of five years. This follows cases of irregularities allegedly committed by them during their tenure as directors.

Both the Bangurs had been served show-cause notices by RBI deputy governor Jagdish Kapur on March 21. They were given three weeks' time and it is now learnt that the RBI decision follows unsatisfactory replies sent by them.RBI had initiated action against certain alleged irregularities and its decision to remove the father and the son from the board is a sequel to the findings. It is learnt that the apex bank's report is quite damaging and action against other officials of the bank may also be taken soon.

The bank, which had changed hands more than four years ago when the Bangurs acquired the majority equity from the Mansinghkas, had reported distressing working results for the year ended March. Its net profit during the year had dipped to Rs 7.91 crore from Rs 46.65 crore in the earlier year.

The total deposits of the bank had risen to Rs 2,938.93 crore at the end of the year against Rs 2,506.93 crore in the previous year, a 17.24 per cent increase. Advances had also risen to Rs 1,498.29 crore from Rs 1,360.98 crore, an increase of 10.09 per cent.

Meanwhile, the board of directors of the bank, has recommended D B Sogani for the post of chairman in place of R S Rathore, who quit some time ago. The RBI has, however, not yet given its approval for Sogani, who is known to be the right-hand man of Keshav Bangur.

The bank now has a new managing director I Sadashiva Gupta, who had acted for three years as the chairman and managing director of Vysya Bank before which he was in the State Bank.

Gupta has already initiated the ``damage control exercise'' in the bank and is upbeat about its future. Gupta said that the bank had ``strong fundamentals'' and he was confident of reversing the trend, given a free hand.

The bank is headless now as there is no chairman. Apart from Gupta the other directors are R Shyam Rungta, D B Singh, Vinay Mittal, Satyajit Mitra, K K S Chauhan and M S Parmer, who represents RBI.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.