RBL Bank’s interim chief executive officer (CEO) and managing director (MD) Rajeev Ahuja on Sunday tried to allay concerns around the health of the bank.
He said events during the weekend are not linked to RBL’s asset quality.
The bank said Vishwavir Ahuja, its managing director (MD) and chief executive officer (CEO), had on Saturday proceeded on leave with immediate effect on medical grounds.
After Viswavir’s resignation, the bank appointed executive director (ED) Rajeev Ahuja interim MD & CEO on Saturday, subject to regulatory and other approvals.
The bank’s board of directors are currently engaged in finding Rajeev’s successor, a process which may take four to six months.
In an analysts’ call, Rajeev said there are five-seven people in the management team that are in the fray to take over as full-time MD & CEO.
Besides the internal pool, the board will also consider external candidates, the management said.
The Reserve Bank of India (RBI) also appointed Yogesh Dayal, its chief general manager, as additional director on the board of RBL Bank for a two-year term on Saturday.
The financial position of RBL Bank remains robust with capital adequacy at 16.3 per cent. It will be in a similar range this quarter (Q3FY22). RBL Bank will take a call on further capital raising after FY22. From FY23, the annual growth is expected to be 15-18 per cent, the management added.
On asset quality, the bank said slippages peaked in Q2 and will be improving this quarter and the next. The net non-performing assets (NPA) position will also be on an improving trend. The net NPA was stable at 2.14 per cent for the quarter ended September 30, 2021.
The bank has been upfront and transparent on the challenges it has faced in various business segments in the past, it added.
Meanwhile, the All India Bank Employees Association (AIBEA) said the Centre must protect the interests of depositors at RBL Bank. It should consider merging RBL with a state-owned bank, said the industry trade union on Sunday.
There are also reports that RBL has been over indulging in retail credit, microfinancing and credit cards. Consequently, it has burnt its fingers resulting in weakening the financials, the AIBEA said.
“We are worried and concerned about the developments that are taking place in the affairs of RBL Bank, ” said the AIBEA, in a letter to finance minister Nirmala Sitharaman.
RBL’s total advances have doubled in the last few years. From about Rs 29,000 crore in 2017, advances have crossed Rs 58,000 crore now, AIBEA said.
It added that action for RBL is important in light of the problems encountered by private lenders like YES Bank and Lakshmi Vilas Bank last year.
Photograph: PTI Photo
Source: Read Full Article