YES Bank names experts to look for new managing director; stock falls 4.16%

Bank's stock has been falling drastically over uncertainty regarding its succession plan

Private lender YES Bank, which recently formed a committee to search for a successor to its managing director and chief executive officer Rana Kapoor, will have two external members in the panel — T S Vijayan, former chairman of the Insurance Regulatory and Development Authority of India and O P Bhatt, former chairman and managing director of State Bank of India.

The private bank disclosed this to the stock exchanges in a filing on Friday.

The committee also comprises three existing board members of the Nomination & Remuneration Committee — Brahm Dutt, chairman and independent director, Mukesh Sabharwal, independent director and Subhash Kalia, non-executive non-independent director, along with the two external experts.

The bank said it has invited proposals from global leadership advisory firms and will finalise the company in the committee’s first meeting, which is scheduled to be held on October 11.

On September 25, the bank had announced plans to ask the Reserve Bank of India (RBI) for an extension of Kapoor’s term, which led to the accusation that the private bank does not have a proper succession plan in place.

Earlier this week, the bank said it will find a new MD & CEO by January and stated that it is fully geared up for succession. The bank will have to send at least three candidates to the RBI, which would ideally be a combination of internal and external candidates, said Rajat Monga, senior group president, YES Bank.

The bank had promoted two senior leaders, Monga and Pralay Mondal as executive directors for “long-term succession planning” in September, subject to RBI’s approval.

The bank’s stock has been falling drastically over the current month, as there is uncertainty regarding its succession plan since Kapoor’s tenure was cut. The bank’s stock closed at RS 206.20 on the BSE on Friday, down by 4.16 per cent from the previous close.