Bandhan Bank hopes director onboarding to firm up transition, says RBI flags no concern

Bandhan Bank says RBI appointment of director good for transition process

Bandhan Bank hopes the onboarding of an additional director by the RBI will only strengthen the transition process as CEO Chandra Shekhar Ghosh is set to retire next month.

“The transition within the bank has been progressing well, and the appointment of an additional director by the RBI will only strengthen this process,” a spokesperson for the Kolkata-headquartered bank told Moneycontrol. “The RBI has not highlighted any concerns to the bank in the context of the appointment of the additional director.”

The regulator appointed Arun Kumar Singh, retired chief general manager of the Reserve Bank of India (RBI) as an additional director on the Board of Bandhan Bank for a period of one year from June 24, 2024 to June 23, 2025, Moneycontrol reported on June 25.

Read: RBI appoints additional director on Bandhan Bank Board

Bandhan Bank said the appointment of the additional director is not intended at monitoring the bank linked to any operational concerns. “We categorically deny the claim suggesting that this regulatory appointment is aimed at monitoring our bank due to multiple operational concerns or otherwise. These claims are speculative and misleading.”

The development comes days before ahead of Bandhan Bank managing director and chief executive officer Chandra Shekhar Ghosh retires on July 9. In April, the bank said Ghosh would assume a larger strategic role at Bandhan group level following his superannuation. The bank is looking out for a CEO and has appointed recruitment firm Egon Zehnder to shortlist candidates to step into Ghosh's shoes.

Read MC Exclusive: Bandhan Bank hires Egon Zehnder to find a CEO to replace Ghosh

On March 21, Moneycontrol reported that Bandhan Bank may consider an external candidate for the corner office. In its exclusive report on April 19, Moneycontrol said headhunting firm Egon Zehnder is reviewing potential names and is likely to submit a shortlist to the bank’s board soon.

According to sources, the agency is looking outside the bank as internal candidates fall short of experience at the board level. Bandhan Bank has two executive directors, Rajinder Babbar and Ratan Kesh. Babbar has been on the board barely for two months, while Kesh has little over one year of experience on the board. The Reserve Bank of India will be more comfortable to hand over the baton to a more experienced candidate.

“Regarding the selection of a new CEO, the bank has formed a board committee to oversee the process, which is progressing as planned. Once finalised, the bank will share the shortlist with the RBI," said the lender.

Shares of Bandhan Bank closed at Rs 203.60 each, down 2 percent, on the BSE on June 25.