Rana Kapoor Shouldn’t Get to be CEO Again: Madhu Kapur
Yes Bank spokesperson says Kapoor’s appointment as MD & CEO was approved by Reserve Bank of India
Madhu Kapur, the widow of Yes Bank co-founder Ashok Kapur, has sought the Reserve Bank of India’s intervention to prevent Rana Kapoor, the other co-founder, from being nominated as the managing director and chief executive officer for another term. “…you are requested to give no approval to the appointment of any person as chairman and managing director of the bank unless it is jointly recommended by Rana Kapoor and us (successors of late Ashok Kapur) as per the Articles of Association,’’ said a letter dated May 9 May, 2014, addressed to the RBI deputy governor. The letter was jointly signed by Madhu Kapur, her daughter Shagun Kapur Gogia and son Gaurav Kapur. The posts of chairman and managing director fall vacant in June and August 2014, respectively. Currently, co-promoter Rana Kapoor is the MD & CEO and MR Srinivasan is the chairman at the private sector bank. Madhu Kapur and her family members decided to approach the regulator after the Yes Bank board and Rana Kapoor refused to take note of their demand for joint nomination and appointment of a consultancy firm to identify a suitable candidate for the post of chairman and MD. Responding to ET’s email query, a Yes Bank spokesperson said: “We have in the past consistently maintained that as a matter of policy the Bank does not comment on matters which are pending before court, as the same has an effect of interfering with the administration of justice. Therefore, the Bank is not commenting on the issues, except in terms that it reiterates its position as taken before the Hon’ble Bombay High Court. The same conclusively contests and rebuts position placed by Madhu Kapur. Hence, the allegations in this regard are strongly denied.” Yes Bank has taken a strong objection to the allegations made by Madhu Kapur’s family. In her letter, Ms Kapur has alleged that Rana Kapoor is misusing his position as MD of the bank. “The resources of the bank are being used by Mr Rana Kapoor to directly and indirectly deny us our rights, including using the bank and independent directors as a front to raise untenable preliminary objections,” said the letter.
The letter also alleges that “independent directors have at the cost of the Bank filed appeals in respect of the matters which do not concern them and benefit only Mr Rana Kapoor.”
The posts of chairman, currently held by MR Srinivasan, and MD, held by Rana Kapoor, fall vacant in June and August 2014, respectively
“…you are requested to give no approval to the appointment of any person as chairman and managing director of the bank unless it is jointly recommended by Rana Kapoor and us (successors of late Ashok Kapur) as per the Articles of Association” Describing the contents of the letter as “defamatory allegations”, the Yes Bank spokesperson said: “Please note that the Bank not only functions in a strongly-regulated sector, subject to the oversight of the Reserve Bank of India, but also the appointment of MD and CEO has been approved by RBI.” The Kapurs have requested the central bank to ensure that Yes Bank follows certain governance standards and take shareholders’ approval prior to important appointments. They allege that the appointment of MR Srinivasan as part-time chairman of Yes Bank and his remuneration package were not approved by the bank’s shareholders. Kapur and Yes Bank are locked in a legal battle over whether Madhu Ka- pur and her successors have a right to nominate a director on the board of Yes Bank. While Kapur maintains that being a legal heir, she inherits the rights associated with the shareholding, the Yes Bank management has argued that she has no such right. Last year, the bank had turned down a proposal to induct Shagun Gogia, daughter of Kapur, to the board citing that she does not qualify for the position. Madhu Kapur holds 11.92% stake in Yes Bank. Rana Kapoor, the other cofounder who heads Yes Bank directly and through other family-owned ventures, holds a 13.64% stake. Madhu Kapur and Rana Kapoor’s wife Bindu Kapoor are sisters.
MD & CEO