Lakshmi Vilas Bank - Is DBS in hot soup with new Indian High Court ruling?

 SSO said... As predicted and expected, DBS has got itself into hot soup territory.

Read this:

It was reported that the Indian High Court in Madras passed an interim order last Fri (27 Nov), proceeding to protect the interests of the Lakshmi Vilas Bank (LVB) shareholders.

The Indian government has earlier announced to merge the loss-making LVB with DBS India.

It has also allowed the entire amount of the paid-up share capital of LVB to be written off. That is to say, LVB’s equity will go down to zero and the original shareholders of LVB will get nothing.

Following this announcement, LVB shareholders filed a petition to the High Court in Madras demanding compensations.

In its interim order, the Madras High Court directed DBS that no further prejudicial action should be taken against the LVB shareholders and asked DBS to furnish an undertaking to compensate LVB shareholders in case the Court rules so at a later stage.

The High Court further directed DBS to create a separate reserve fund in its books of account to the extent of the face value of shares of the transferor company (LVB) and maintain the same subject to further orders from the Court.

“…completely reducing the shares is not an exercise which has happened in the public domain and the shareholders do not appear to be aware of the exact reasons why this is so,” the Court observed.

Further, the court added that even if the authorities have the power to reduce the share value during an amalgamation under Section 45 of the Banking Regulation Act, reducing it to zero or negative, prima facie, it cannot be done without very compelling reasons.

Major shareholders in LVB include Indiabulls Housing Finance (4.99 per cent), Prolific Finvest Private Ltd (3.36 percent), Srei Infrastructure Finance (3.34 percent), MN Dastur and Co Pvt Ltd (1.89 percent), Capri Global Holdings Pvt Ltd (1.82 percent), Capri Global Advisory Services (2 percent), Boyance Infrastructure Pvt Ltd (1.36 percent) and Trinity Alternative Investment Managers (1.61 percent).

As of 27 Nov, LVB ceased to exist and have become part of DBS India. LVB was founded in 1926 by a group of businessmen in Tamil Nadu. The bank rose to prominence lending to small businesses.

But the fall came quick after it aggressively shifted from retail to wholesale loans, resulting in a lot of bad loans.

The next hearing is likely to be held on January 5 next year.


It is like Robin Hood of the Sherwood Forest. Robbing the rich to give to the poor.

Robin Hood tells the Rich Man, known as the Damned Boaster of Sinaplenty:

"You must give me an undertaking that you will put sufficient money at your home, enough to compensate all the poor in my village, in case I come tomorrow to rob you. Is that clear?"



Anonymous said...

Very slippery. Very cunning. Very dirty.

All measures imposed by the unscrupulously righteous (albeit one-sided) judge of Madrass' High Court are aimed at forcing DBS to lose money, a bargain it must never have calculated before greedily and hastily swallowing up the LVB.

But I suppose the Government of India must have anticipated that such actions by the LVB shareholders could have taken place. Could have collaborated with at least one of the shareholders behind closed doors even.

Such dirty tricks are well-known in India's business environment, especially when corrupt government officials or agencies are involved.

Anonymous said...

Smells of Modi's modus operandi.
Same as CECA.

Anonymous said...

That was a bait that caught the big hungry greedy fish.

Check out who is the CEO of DBS.

Put two and two together, I smell something very fishy coming out of the big fish.

Bookworm scholar too busy fixing citizen critics has no time to think of how to fix his concubine who allowed herself to be fixed by the big fishy CEO.

Unknown said...

It is ok ah Gong money ,money not enough increase CPF contribution to cover

Chua Chin Leng aka redbean said...

This has the potential of becoming a bottomless pit where money goes in and in and cannot see daylight.

Who would be responsible for making this decision to dump money into a dark hole?

The financial world has this phrase, 'throwing good money after bad money'.

Anonymous said...

You cannot trust the Indians, least of all Modi. The Japanese found out too late. Now DBS is set to find out they may have been taken to the cleaners.

When you do business in India, anything can change overnight, even though they said something today, tomorrow is another matter. Trust their courts and judges at your own peril. Bollywood movies have been telling such horror stories for decades, which must be based on truth, but no lessons have been learnt. Look at what is happening to Chinese businesses in India. They may even be nationalised by the Indian Government in sheer desperation.

That DBS is in hot soup is no laughing matter. The parasites will eat the guts of DBS, lock stock and barrel. Bailing out depositors, bailing out shareholders, bailing out Modi whose US$5 trillion dream is now in tatters and not even worth US$3 trillion, with the pandemic, recession and farmers now set to create unrest.

More Indian banks will fail for sure when the Indian economy falls further. But there is always DBS, the Federal Reserve of India standing by to merge with them just in case. Anyway, what has happened to those Sinkies who invested in the Lehman Bros fiasco and lost their pants, including the Town Council's money collected from HDB flat owners? Have they been compensated like the Indian Bank shareholders?

Chua Chin Leng aka redbean said...

Making such a big decision, money wise, to accept this Indian proposal to buy over the debt of Lakshmi Vilas simply based on economic and business logic is inadequate.

The political risk is so high, so much higher than buying over Thaksin's telecom in Thailand. India is a very risky proposition for putting big money into this country. LKY spoke against it and many western companies can vouched for it that it is not worth the risk. GM is among the numerous big western companies that had pulled out their investments in India. Remember the silly plan to build a city in India and turned sour? How much money wasted there?

India is a country where only fools would rush in with their money and not seeing them again.

Anonymous said...

There are a very few number of very, very, very silly Sinkies that could see light in a dark bottomless pit and encouraging daft Singaporeans to throw their money into this pit.

Believe in them at your own peril. But if one is playing with OPM, that is another matter.

Anonymous said...

Ya, one of them got screwed until cannot see daylight and today walking around like a fool. He probably would not go to India anymore.

Anonymous said...

India is a country where only fools would rush in with their money and not seeing them again.
December 04, 2020 11:39 am

Do you think PAP has an endless supply of fools?

SSO said...

DBS vs LVB: Sweet Meat For The Wolves, Game Of The Century

The Lakshmi Vilas Bank (LVB) Deal is the most "lucrative" and "enticing" business proposal ever made in the history of banking and finance. Some more, it was made by such a distinguished and outstanding government of India, under the steady steering hands of the well-known PM Modi of CECA fame.

Simply speaking, it is "Too good to be true."

It is so good that it simply cannot be turned down by any rich investor with a huge capacity of cheap funds, using other people's money of course, lying around in the hands of eager-beavers ever-ready to make a kill in his/her name, so that at year-end he/she could reap another unimaginable hefty sum of $millions in annual bonuses, and retires in comfort, laughing all the way to the bank everyday.

But, but, but the thing is:

If the deal is so good...too good to be true, why didn't the Indian Government buy over LVB wholesale by itself? The Modi government could not see the "lucrative" long-term returns-on-investment? The hawkish Modi leadership was out of wits and funds and therefore could not go in for the kill by itself? As such, it has to invite lucky DBS to grab it for a song and also write-off the shares of the previous owners of LVB with ease, without having to worry about potential repercussions?

Or, Why didn't any of the big and rich local Indian companies take over the in-deep-shit LVB and immediately owns 350 banks throughout India, which took LVB almost 100 years to build up? So wonderful! So easy! Why no takers?

Questions aside, whichever way one may look at it, under such circumstances, there is always big money to be made in the shades, under the shadows and enclosed in darkness, behind closed doors, over a sumptuous dinner, by some shrewd, crafty and cunning big players in the Game Of Cheat, in this Game Of The Century.

The meat is so sweet and fresh, and therefore, the greedy and hungry wolves are many. Like the Hollywood movie "The Wolf of Wall Street", this is the "The Wolf Of Madrass" in real life.

In my mind, the first suspected wolf is the one who proposed the purchase of LVB to those that count.

The second suspected wolf is the one who influenced the decision-maker to go ahead with throwing good money after bad loans.

The third suspected wolf is the one who made the decision to buy over the LVB in accordance with the Modi Government's alluring proposal of a life-time.

The fourth suspected wolf is the PR guy, the one who looks like a white-collar criminal with corruption written all over his face when he spoke with the intention of influencing the unguarded about how good it is to invest in India Tamil Naidu.

The fifth suspected wolf is the middleman or men in this Game Of The Century.

The sixth and subsequent suspected wolves are those in the other camp, right from the top to the bottom.

Last but not least, I simply say only, the glaringly suspected wolf is the "Honourable" Judge who presided over this case, who has holds the power, who made the judgement, and who aimed and shot two arrows, one after another, straight
into the Heart of DBS, just like what Robin Hood would have done.

I believe the CBIB would have already started to get busy investigating deeper and wider into this "too good to be true" fishy Game of the Century.

Keppel's Brazil misadventures, for 13 long years, are still very fresh in our minds, except for those who have dozed off.

So, what now, DBS, going forward?

SSO - 4 Dec 2020.

PS: CBIB stands for Cheats and Badass Investigating Board.

Anonymous said...


Anonymous said...

People walk in the lobby of a DBS Bank building in Singapore

People walk in the lobby of a DBS Bank building in Singapore (File photo | Reuters)
By Sesa sen
Express News Service

NEW DELHI: Religare Finvest, which has a pending case against Lakshmi Vilas Bank (LVB) for misappropriating fixed deposits worth Rs 750 crore, has filed a petition with the Delhi High Court to make DBS Bank India a respondent in the ongoing suit, on the ground of the mergers of the two banks. The amount has swelled to Rs 900 crore along with the interest, according to Religare.

The high court hasn’t made DBS as a party in the case so far. However, it has issued a notice in relation to this case on December 1 and the next hearing is on February 25, 2021. DBS has been given five weeks to respond. Religare has also sought that the court pass an order allowing substitution of DBS Bank India Limited as defendant in the present suit in place of Lakshmi Vilas Bank.

Is this all part of a scheme to bleed DBS India dry?

Anonymous said...

Andhra Pradesh govt issues orders to liquidate Amaravati start-up area

In 2017, the N Chandrababu Naidu government had entered into an agreement with a consortium of Singapore companies Ascendas-Singbridge and Sembcorp Development for the development of Amaravati capital city start-up area project in 6.84 square kilometres of government land.

More than a year after the consortium of Singapore companies pulled out of the project to develop a start-up area development project in Amaravati, the present capital city of Andhra Pradesh, the state government issued orders to liquidate the project.

A government order to this effect was issued by state municipal administration and urban development secretary J Syamala Rao on Wednesday.

According to the order, the state government has given approval to Amaravati Metropolitan Development Authority for the termination of agreements of concession and development and also shareholders’ agreement signed with the Singapore consortium for the start-up area development project at Amaravati under the auspices of Amaravati Development Partners (ADP) Private Ltd.

The government also authorised the officials concerned including Metropolitan Commissioner of Amaravati Metropolitan Region Development Authority (AMRDA), chairman and managing director of Amaravati Development Corporation Limited and the Board of Members of Amaravati Development Partners Pvt Limited (ADP) to execute the termination agreements.

The government authorised them to initiate the process of liquidation of the ADP forthwith as per the laws in force.

In 2017, the AP government led by then chief minister N Chandrababu Naidu had entered into an agreement with the consortium of Singapore companies Ascendas-Singbridge and Sembcorp Development for the development of Amaravati capital city start-up area project in 6.84 square kilometres (about 1,691 acres) of government land.

The consortium had a 58 per cent stake and the state government 42 per cent in the project. The ADP, the agency incorporated under this public-private partnership, was supposed to develop and market the available land in the start-up area for offices and other commercial activities to companies and institutions across the globe.

In November 2019, the Singapore Consortium pulled out of the project following change of guard in Andhra Pradesh. The closure of the project was based on mutual consent between the AP government and the consortium. “We note that the newly elected government of Andhra Pradesh has decided not to proceed with the Start-Up Area, given its other priorities for the state,” Singapore minister for trade relations, S Iswaran, said in a statement then.

Later, the state government authorised the then APCRDA Commissioner (now commissioner of AMRDA) and ADCL chairman to finalise draft termination agreement for the project after working out all legal issues.

Anonymous said...

How much money has already been dumped into the project by the Singapore Consortium? Or is it a Connedsortium?

Anonymous said...

DBS Bank India receives ₹2,500 cr. capital from parent
(Mumbai, December 04, 2020 22:41 IST)

DBS Bank India Ltd (DBIL) said it has received capital infusion of ₹2,500 crore from DBS Bank Ltd., Singapore, to support the India franchise, following amalgamation of erstwhile Lakshmi Vilas Bank (LVB) with DBIL.

Chua Chin Leng aka redbean said...

It was reported in the Indian media today that an Indian MP and BJP member, Subramanian Swamy, has asked the Indian government to put the Lakshmi Vilas Bank (LVB) merger with DBS Bank India on hold (‘Subramanian Swamy asks PM Modi to put LVB merger with DBS on hold‘, 4 Dec).

Sawmy has sought to put the LVB-DBS merger on hold in order to facilitate a forensic audit of the takeover of the assets of LVB by DBS. Swami called for an examination of the allegations against the DBS made internationally and in the company’s home country, Singapore, on money laundering.

In his letter to PM Modi, Swamy said, “What is amazing is that RBI had sought objections from stakeholders which were to be filed by the close of business hours on November 20, 2020, effectively giving less than 72 hours to them to respond.”

He noted that several stakeholders, notably the bond and shareholders, had raised objections to the scheme. However, the RBI forwarded the draft proposal for Cabinet’s approval in great haste on November 25, without factoring any such objections. Subsequently the merger came into effect on November 27.

I hope Singaporeans are watching this development and should DBS be fleeced and lose a bomb because to this debacle, they know who is responsible for it.

Sorry not enough. It is the people's money, not OPM, and DBS is our national bank. Its collapse is unimaginable and unacceptable.

It is looking more like a can of worms.

Anonymous said...

DBS Singapore now looks more like an Indian Bank to me. Headed by an Indian, it does not surprise me that the merger of its subsidiary, DBS India with a failed Indian Bank took place so hurriedly and unceremoniously quietly, without objection from the Government.

Anonymous said...

Even if Singaporeans know who is behind it, some perpetrators are members of the royalty and cannot be punished. A scapegoat will be found and slaughtered and everything will be peaceful and quiet and business as usual.

Learn from Trump. He is going to pardon all his cronies in crime and is said to be looking to pardoning himself as well. Ownself pardon ownself isn't too radical right?

Anonymous said...

This time a lot of the people's money at stake. The Indians are going to bleed dry DBS India and if possible DBS Singapore as well.

Our reserves will be badly affected all because of stupidity. Could be more than stupidity.

Lee Kuan Yew and Goh Keng Swee must be cursing and swearing. How could Singapore produce such idiots to make such stupid decision. The money lost to the failed American banks not enough, did not learn anything and repeating the same mistake.

Any due diligence done?

Anonymous said...

This Lakshmi Vilas case is not that simple. It is looking like a well planned scheme to rob DBS India dry. There will be more and more claims against DBS India that had nothing to do with it. For no reason DBS India is now responsible for all kinds of claims and wrongs of Lakshmi Vilas Bank and has to pay for them.

How can this be allowed to happen? Would $420m be enough or a bottomless pit?


Anonymous said...

Years of hard work and savings voluntarily pouring into a bottomless pit.

Anonymous said...

The government must quickly step in before it is too late. Stop the loss of the people's money immediately.