Find successor for CEO soon: Madhu Kapur to Yes Bank
CONFLICT OF INTEREST Respect RBI views, extension of Rana Kapoor’s tenure not in lender’s best interest, says Kapur
Bank Ltd’s decision to request the regulator to extend managing director Rana Kapoor’s tenure is not in the best interests of the lender, Madhu Kapur, the widow of co-founder Ashok Kapur and the bank’s second largest shareholder, wrote in a letter to the board.
In the September 28 letter to the bank’s board, Kapur suggested that the board expedite the process of finding a successor to Kapoor so that the bank does not suffer any long-term setback.
“The decisions that the board appears to have taken are not, in my view, in the best interests of the bank as a public trust financial institution,” Kapur said. Mint has reviewed the contents of the letter.
On September 25, the board of Yes Bank had said it would ask the Reserve Bank of India (RBI) to extend managing director and chief executive Rana Kapoor’s tenure by eight months. The board decided it will first seek an extension for Kapoor till April 30 for finalization of financial statements for the year to March 31, and thereafter a further extension till September 30 for completing the annual general meeting process.
The bank’s board decided on the course of action after RBI agreed to extend Kapoor’s tenure till January 31, 2019 in response to the bank’s request for a threeyear extension till August 31, 2021. Yes Bank shares have fallen 18.65% in September because of the uncertainty related to Kapoor’s reappointment. An email sent to Yes Bank did not elicit any response till press time.
Madhu Kapur wrote that Yes
MUMBAI:Yes
Bank should respect the views of RBI as the banking regulator and take appropriate steps at the earliest to identify a person “who is credible, of special caliber, with unimpeachable integrity” under whose leadership the bank will reach greater heights as Rana Kapoor’s successor.
The board in its September 25 meeting decided to set up a search committee to identify a successor to Kapoor. The committee will include three existing nomination and remuneration committee board members, along with two external experts. The board also decided to promote Rajat Monga and Pralay Mondal as executive directors, subject to approval from RBI.
Citing a June 4, 2015 Bombay high court judgement, Kapur said in her letter that even the appointment of Monga and Mondal as whole-time directors had been struck down earlier by the court. She added that these earlier appointments were done without consultation with co-founders. Kapur has also requested the board to not take actions contrary to the RBI directive and the judgement of the Bombay high court so that the “challenging situation presently faced by the bank is redressed without suffering any longtime setback to the bank and its stakeholders”.
She further wrote that as one of the largest shareholders, the co-founders wish to act constructively in the best interest of the bank and are willing to take steps to protect and further the interest of the bank and all stakeholders.
On September 28, Rana Kapoor tweeted that his shares in the bank are akin to diamonds and vowed not to sell them to cut his or his family’s promoter-holding in the bank.
An investment arm of financial services company Edelweiss is closely evaluating buying out 140 megawatts (MW) of solar power assets at the Bhadla solar park in Rajasthan, two people aware of the development said. The assets, owned by Delhibased Rising Sun Energy, are likely to command a value of about ₹800-900 crore.
The $1 billion Edelweiss Infrastructure Yield Plus Fund, an infrastructure-focused alternative investment fund managed by Edelweiss Alternative Asset Advisors Ltd, is yet to make its first investment in the renewable energy sector. One of the two people quoted above told Mint: “The energy sector is not Edelweiss’ core area of strength; they have been doing intense evaluations of some projects over the last few months and are careful not to get anything wrong.”
Mint reported in July that Edelweisswasevaluatingbuying a stake in the local solar energy assets of French power company Engie, which has an 810MW solar portfolio in India through its subsidiary Solairedirect. Emailed queries sent to both Edelweiss and Rising Sun went unanswered at the time of going to press.
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