RBI refuses extra time to Rana Kapoor, tells Sure Financial institution to nominate new chief by 1 February


Mumbai: Reserve Financial institution of India (RBI) on Wednesday refused to grant extra time to Sure Financial institution’s long-serving CEO and MD Rana Kapoor and requested the personal sector lender to nominate his successor newest by 1 February, 2019.

Final month, the Sure Financial institution board had sought at the very least a three-month extension for Kapoor from the RBI past 31 January, 2019, stating that discovering an acceptable successor is a “time consuming problem”.

The central financial institution, nonetheless, has not agreed to the suggestion and insisted Sure Financial institution’s board ought to discover his successor inside the stipulated time.

Representational picture. Reuters

“The Reserve Financial institution of India has reaffirmed {that a} successor to Shri Rana Kapoor, MD & CEO, YES Financial institution needs to be appointed by 1 February, 2019,” the lender mentioned in a inventory change submitting.

The RBI had earlier curtailed the three-year time period that the board had looked for Kapoor, additionally one of many promoters of the financial institution, to 31 January, 2019, and requested the financial institution to discover a alternative.

Kapoor has been in his place for the reason that inception of the financial institution in 2004.

The financial institution’s board has already established a search and choice committee comprising three members from the present nomination and remuneration committee together with two exterior consultants to determine Kapoor’s successor.

Kapoor owns 10.66 % share within the financial institution.

Sure Financial institution shares dropped 6.85 % to shut at Rs 231.75 apiece on BSE.

Kapoor is the second chief govt at a non-public sector lender after Shikha Sharma of bigger rival Axis Financial institution to face regulatory wrath when it comes to extension of CEO’s tenure.

Each the banks have been discovered to have under-reported non-performing belongings by over Rs 10,000 crore every for 2 consecutive years in regulatory audits carried out by the RBI.

The RBI has been sustaining a cautious stance with regard to heads of personal sector banks within the current months.

Earlier this week, it gave approval for under three-year to Sandeep Bakhshi as CEO and MD of ICICI Financial institution, as in opposition to five-year time period sought by the board of the nation’s largest personal sector financial institution.

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