Over the last couple of months, we have exposed how the professional managers at this institution, which is 51 per cent owned by government bodies (LIC, GIC, UTI, IDBI Bank and IFCI), lost control over a 100 per cent brokerage subsidiary — SHCIL Services Ltd (SSL) — through a surreptitious sale of 76 per cent of its equity to three unknown entities. On April 15, the government asked IDBI Bank to take over the management. N Jayaraman Iyer, the former chairman and managing director (CMD), was sent on mandatory leave and RK Bansal, a senior general manager of IDBI Bank, was put in charge of management. While SHCIL has made some progress in its investigation, absolutely nothing seems to have happened at SSL, the brokerage firm that was once a subsidiary. Despite repeated attempts, the BSE has refused to respond to queries. The BSE is the first line regulator for SSL and its official website misleadingly depicts the firm as being part of the SHCIL group, without providing any shareholding details. Moreover, SSL remains hugely dependent on its former parent SHCIL. For instance, SHCIL continues to house SSL’s servers at Vikroli, which may finally be moved out at the end of the month. Does it mean that financial institutions, which own 51 per cent of SHCIL, are sanguine about the loss of the brokerage subsidiary? Well, the senior management held a day-long meeting last Saturday to take stock of SHCIL, including its staff requirements, recoveries, profitability and review of the commercial arrangement with SSL. Maybe the deliberations will lead to further action this week.

... contd.