The Securities and Exchange Board of India (Sebi) on Thursday issued a warning to ICICI Bank for flouting norms during its outreach programme to shareholders of broking firm ICICI Securities to vote in favour of the delisting.
The market regulator has termed the outreach programme by ICICI Bank as ‘inappropriate’ and has directed the bank to take action against its officials.
Several investors of ICICI Securities had complained that employees of ICICI Bank called and influenced or misled shareholders to vote in favour of the delisting proposal under the guise of spreading awareness.
Sebi confirmed that some of the officials of ICICI Bank went beyond the outreach programme by making repeated calls and asking for screenshots of voting.
“This has been viewed seriously. You are, therefore, warned to be careful in future and improve your compliance standards to avoid recurrence of such instances, failing which action may be initiated,” said Sebi in the warning letter to the bank.
Sebi has also directed the bank to take action against the officials who violated guidelines and examine the investor complaints on Sebi’s ‘Scores’ portal.
The bank is also required to submit a brief on the discussions and the actions taken in the matter within 10 days of their next board meeting.
The market watchdog also pointed out that the claim of providing a ‘balanced factual’ perspective does not stand as ICICI Bank is a promoter with over 74 per cent shareholding and an interested party in ICICI Securities’ delisting.
On the same matter, the National Company Law Tribunal (NCLT) is hearing an appeal filed by a group of minority shareholders who claimed that ICICI Securities breached shareholder privacy and administration rules by sharing the details of shareholders with ICICI Bank.
The minority shareholders, led by Bengaluru-based investment manager Manu Rishi Guptha, had also alleged other irregularities. They argued before the tribunal that the asset management arm of ICICI parentage purchased a significant number of shares a month before the voting and then voted in the ‘guise of public shareholding’.
In March, ICICI Securities secured shareholders’ approval to delist the stock with nearly 72 per cent of the minority shareholders’ vote in favour, surpassing the two-thirds majority needed.
Post-delisting, ICICI Securities will merge with parent firm ICICI Bank and become a wholly-owned subsidiary again after six years.
The shareholders will be allotted 67 shares of ICICI Bank for every 100 shares of the brokerage firm.
First Published: Jun 06 2024 | 7:20 PM IST
