The Reserve Bank has allowed Rana Kapoor to continue as Yes Bank MD and CEO till January 31, 2019, the bank said Wednesday in a regulatory filing. In June this year, Yes Bank’s shareholders had approved the re-appointment of Rana Kapoor as the chief executive and managing director for three years, subject to final approval from the Reserve Bank of India. His present term ended on August 31. However, the RBI had allowed him to continue till further notice. “Reserve Bank of India has vide letter dated September 17, 2018 received today, intimated that Shri Rana Kapoor may continue as the MD & CEO till 31 January 2019, and the Board of Directors of the Bank are scheduled to meet on September 25, 2018 to decide on the future course of action,” the bank said
Reserve Bank of India has vide letter dated September 17, 2018, received today, intimated that Rana Kapoor may continue as the MD & CEO till 31 January 2019, and the Board of Directors of the Bank are scheduled to meet on September 25, 2018, to decide on the future course of action. (YES Bank Statement)
The disclosure follows an August 30 communication in which the bank had said the RBI has allowed Kapoor to continue as the bank’s CEO until ‘further notice’. Kapoor’s current term ended in September. In June, the bank had approved another three-year term but required RBI’s approval for the same. The regulator has now given Kapoor a limited term extension.
While Yes Bank has seen rapid growth over the last decade, Kapoor’s leadership came into question after the regulator pointed out discrepancies in the way the bank reported its bad loan numbers. This led to two consecutive years of higher bad loan ratios reported because of the RBI’s intervention.
Rana Kapoor’s exit is the second such instance initiated by the banking regulator sector. The reappointment of Shikha Sharma, managing director and chief executive officer, Axis Bank Ltd. too did not receive RBI approval earlier this year, even after the bank’s board had approved it. RBI asked the bank board to reconsider its approval prompting Sharma’s exit. She will step down on December 31, following which, Amitabh Chaudhry of HDFC Standard Life Insurance Company Ltd. is set to take over.