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How Satyam and Global Trust Bank are ignominiously linked
January 08, 2009 16:44 IST
Satyam's [Get Quote] Ramalinga Raju and erstwhile Global Trust Bank's Ramesh Gelli shared more than a common mother tongue. They climbed quickly to the pinnacle of their careers and fell from grace with equal speed.
Both Raju and Gelli symbolised the so-called 'Telugu pride' in the corporate world and were considered visionaries in their respective fields of operation. They were heralded as institution-builders, but in the end their fall too was equally swift due to a set of financial frauds.
Incidentally, PricewaterhouseCoopers was the auditors of both the institutions.
Ramesh Gelli was the chairman of Vysya Bank and later launched the country's first private sector bank, Global Trust Bank, in 1993-94 that was a phenomenal success. In 2001, however, GTB was in turmoil and Gelli faced an ignominious exit as the head of the bank following a failed merger with the UTI Bank [Get Quote]. In 2004, GTB's net worth turned negative because of what were termed as 'mismanagement and reckless lending practices.'
Gelli also allegedly had a dubious relationship with stockbroker Ketan Parekh and the former faced the charge of price rigging. The Securities and Exchanges Board of India found a nexus between Gelli and Parekh and in 2002 it imposed a ban on Gelli. Though he was re-inducted into the GTB board in February 2004, Gelli could not last a month and faded into oblivion thereafter.
A product of the Asian Institute of Management, Manila, Ramesh Gelli was conferred the Padma Shri by the government of India in 1990 and was considered an icon in the banking industry. The GTB venture, however, brought him more ignominy than glory and he has literally sunk without a trace thereafter.
Ramalinga Raju too epitomised Telugu pride in the corporate world, more so in the software industry, and stood as a role model with his pioneering ventures both in the country and abroad. He started rising to dizzying heights in the 1990s, riding on the software boom and on official patronage, but ultimately nothing could save him from his own wrongdoings.
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