Why Is Tamilnad Mercantile Bank Always In The News?

It’s an over hundred year old bank. A solid old generation private bank, Tamilnad Mercantile Bank (TMB) became a listed entity when it entered the capital market a few months ago. TMB is a heady cocktail of an organisation. Promoted by the Nadars for the Nadars, this bank has been mired in controversy ever since the Ruias of the Essar group acquired over 65% shares by cashing in on the internecine quarrel between the promoter groups. But the Ruais had to depart by selling the investment arms that held TMB shares to Sterling C Sivasankaran for acquiring cellular licence for Delhi circle from the latter. But Siva too found the going tough and had to sell TMB shares.  While the Nadar community bought back a part of it, it couldn’t muster money to buy the rest.  Former chairman of the bank MGM Maran and other directors got into the act and allegedly facilitated a deal for the sale of 23.6% shares of TMB from Indian shareholders to unauthorised overseas persons. An investigation followed into advance remittances by certain entities for buying TMB shares through an escrow account with Standard Chartered Bank. SCB and Maran were levied hefty penalties. The Enforcement Directorate now has attached the properties of Maran – including his shares in group firms and TMB –and his company Southern Agrifurane. Well, the TMB issue never ceases to go away, it appears.