The Reserve Bank of India has asked Yes Bank to cut short the tenure of its CEO and MD, Rana Kapoor. The central bank has permitted Kapoor to continue in his current position till January 31 2019, post which Yes Bank is to have a new MD and CEO.
According to a report by Economic Times, the board of Yes Bank will meet on Sep 25 to discuss what needs to be done next.
The shareholders of the bank had, in June, approved the reappointment of Kapoor as the MD and CEO of the bank, but the decision was subject to the approval of the RBI. Kapoor’s tenure was to be for three years, starting from September 2018.
Incorporated in the year 2003 by Rana Kapoor and his brother-in-law Ashok Kapur, Yes Bank has had internal issues following the death of Kapur in 2008. In 2015 the Bombay High Court passed a ruling in favour of Madhu Kapur stating that new full-time directors can be appointed to the board of the bank only with the approval of all promoters, according to a report by Livemint.
Promoters of Yes Bank include Kapoor, the Kapurs, Yes Capital Private Limited (India), Mags Finvest Private Limited, and Morgan Credits Private Limited. While Kapoor has a stake of 4.34 per cent (as of June 30 2018), Kapur owned a 7.62 per cent stake in the entity.
Rana Kapoor has been the CEO of the bank since 2004. Yes Bank is currently the fourth largest private bank in the country, having won numerous awards since its inception.
Sources: Economic Times, Livemint, Business Standard, Business Today, Yes Bank website.