RBI approves appointment of CoD to run Dhanlaxmi Bank till CEO is finalised

Dhanlaxmi Bank has said the RBI has approved a three-member interim Committee of Directors (CoD), headed by G Subramonia Iyer, to run the private sector bank after the shareholders voted out its MD and CEO Sunil Gurbaxani.

The shareholders rejected the resolution for appointment of Gurbaxani as MD and CEO at the 93rd AGM of the bank held on September 30. “Consequent to this, please note that Reserve Bank of India has, as requested by the Board of Directors, approved an interim arrangement for formation of a Committee of Directors to exercise the powers of Managing Director & CEO till such time a new MD & CEO takes charge,” it said in a regulatory filing.

The committee of directors (CoD) will be constituted with Iyer as chairman and G Rajagopalan Nair and P K Vijayakumar as its members. “As advised by RBI, the interim arrangement will not continue beyond four months within which the bank will complete the process of identification and appointment of a new MD& CEO,” it said.

As per the Scrutiniser’s Report of the 93rd AGM of the bank, 90.49 per cent shareholders voted against Gurbaxani’s appointment while only 9.51 pc voted in favour.

Gurbaxani who assumed office as CEO on February 27, this year, was appointed for a three-year period. A veteran banker, he has 35 years of experience with the SBI Group and Axis Bank. On Tuesday, RBI appointed DK Kashyap, GM at the central bank’s Bengaluru Regional Office as an Additional Director on Dhanlaxmi Bank’s board till Sept 27, 2022. The RBI usually does not appoint its nominee on the boards of private banks unless there are exceptional circumstances to avoid any conflict of interest.