- Shares of RBL Bank fell by 9.98% today and closed at 130.90(- ₹13.40, -9.29%)
- Rajeev Ahuja was appointed as the interim MD, CEO to take care of the day to day operations of the bank.
- The RBI clarified that the bank is well capitalised and there are no concerns over its business performance or practices.
After the Reserve Bank of India approved the appointment of Rajeev Ahuja as the interim MD and CEO of RBL Bank for 3 months or till there is a regular appointment.
Earlier, a ₹300 crore loan was written off within 7 months of its sanction, and this was the key reason for the RBI’s intervention in the bank. The RBI clarified that RBL bank remains well capitalised and there are no concerns over its business performance or practices. The shares of RBL bank hit 52-week lows. It fell by ₹14.40 (9.98%) to ₹129.90 apiece, despite RBI’s clarification and closed at ₹130.90.
Rajeev Ahuja was appointed by the board, subject to regulatory and other approvals as the interim MD and CEO, after the erstwhile CEO Vishwavir Ahuja was sent on leave by the board. He had six months left in his tenure.
Vishwavir’s sudden departure was seen as a result of the RBI communication to the bank a day earlier (December 24, 2021), appointing his Chief General Manager Yogesh K Dayal to the board of the private sector lender. The appointment of an RBI official on the board of a private sector bank is not usually seen as a normal phenomenon.
“We wish to inform you that Reserve Bank of India vide its letter dated December 28, 2021, has approved the appointment of Rajeev Ahuja as the interim Managing Director & CEO of the bank for a period of three months with effect from December 25, 2021, or till the appointment of a regular MD & CEO, whichever is earlier,” RBL said in a regulatory filing on Thursday.
Rajeev in his very first interaction with reporters and investors on December 26 had said the bank was financially sound and that it had full support from its board of directors and the RBI.
The apex bank, on its part, also came to the rescue of the bank the very next day, stating it was strong financially. The depositors, as well as the investors, should not heed to the speculation around the sudden change of affairs at the helm of the bank, the RBI had said.
