|
Despite
bankruptcy
Shifra
Menezes
27 July 2004
 Established
in 1993 and headquartered at Secunderabad, the Global
Trust Bank (GTB) was promoted as a private sector bank
by Ramesh Gelli, Jayanta Madhab and Sridhar Subasri against
the backdrop of the government's policy of deregulation
and liberalisation. With a 40-per cent contribution by
the core promoters, the bank was the first in India to
attract equity participation from two international multilateral
institutions — International Finance Corporation
(IFC) and Asian Development Bank (ADB) — the only
other major shareholders.
Headed
by managing director Sudhakar Gande and presidents Anand
Anchan and G Laxminarayana, GTB was once touted to be
one of India's best before it succumbed to staggering
NPA.
The
bank has a network of 104 branches and 275 ATMs in 34
cities across the country. Retail banking products, wholesale
banking products, treasury products, investment banking
products, non-resident Indian products, depository services
and advisory services were some of the offerings the bank
has served up.
Strategic
alliances
Apart from these alliances, GTB has entered into various
other equity and technical partnerships. The bank has
signed an MoU with Daiwa Securities Group, part of the
Daiwa Institute of Research, to undertake joint research
and training on the Indian economy and industry. It has
also tied up with Hambrecht & Quist to develop skills
in recognising opportunities in the fields of biotechnology,
communications and information technology.
GTB
has sought the expertise and training support of TA Enterprise
Berhad, Malaysia, for their investment banking division's
placement, bought out and structured deal activities.
During
2000-2001, the bank tied up with shopping malls, e-brokers
and utility service providers, which increased GTB's customer
base to about 660,000. To accommodate the increase, five
more branches were opened and 65 more ATMs were launched,
taking the tally for the year up to 79 and 101 respectively.
The
bank also tied up with Canara Bank to administer the swift
remittance facility. With this in place across 55 centres
in India, non-resident customers could remit speedily
to dependents almost anywhere in India.
GTB
has been running its operations successfully (Rs11.8 crore
in net profits for the nine-month period ending December
31, 2003) and setting records until it collapsed under
the pressure of bad loans.
The
bank's initial public offering of Rs1,040 million was
over-subscribed by a record 60 times, with subscriptions
of Rs62.40 billion from over 1 million investors. But
this isn't the only feather in GTB's cap. Global Trust
Bank was recognised as one of the fastest growing banks
in India when it received Rs1 billion-worth of deposits
in its first day of operations; Rs10 billion by the end
of the year; and Rs27.06 billion in 35 months. At the
end of 35 months its total business exceeded a whopping
Rs43.02 billion.
The
bank also was given top billing in a survey of India's
best banks conducted by Financial Express in February
2001.
The
bank went through a dark period when along with UTI Bank,
it entered into a merger proposal in January 2001 to create
the largest private sector bank with a swap ratio of nine
shares of UTI Bank for four shares of GTB. Since submitting
the merger application, many issues appeared in the media,
which caused both banks to withdraw from the proposed
merger.
Under
pressure of allegations of conniving with rogue stock
broker  Ketan
Parekh for rigging the bank's share price, the then chairman
and managing director (CMD), Ramesh Gelli, was forced
to step down, rejoining the board in March 2004.
List of reports
on Global Trust Bank
List of general reports
on banks
|
