The Board of Directors of Karnataka Bank has accepted the resignation of Srikrishnan Hari Hara Sarma, Managing Director and CEO of the Bank. His resignation, tendered earlier today, will take effect from July 15, 2025.
Sarma cited personal reasons, including his decision to relocate back to Mumbai, as the basis for stepping down.
Additionally, Sekhar Rao, Executive Director of Karnataka Bank, has also submitted his resignation, citing personal reasons and an inability to relocate to Mangaluru. His resignation has been accepted by the Board and will be effective from July 31, 2025.
The lender, in response to these developments, has constituted a search committee to identify suitable candidates for both the Managing Director & CEO and Executive Director positions.
As part of the interim measures, Karnataka Bank has appointed a seasoned senior banker as Chief Operating Officer (COO), who will assume charge on July 2, 2025. Further substitute arrangements are underway, subject to regulatory approval.
Karnataka Bank CEO Sarma steps down due to differences with board
Moneycontrol was the first to report the development.
Differences between Sarma, Rao and the bank’s board on a certain expenditure incurred by the lender is said to have resulted in the chief executive wanting to step down from his position.
The differences between the board and CEO and ED is believed to have cropped up in May when the bank’s statutory auditors highlighted in their notes Rs 1.53 crore of expenditure in connection with engaging a consultant and other purposes.
The expenditure incurred is said to have been beyond the powers of the bank’s whole-time directors and was not ratified by the Board. “Consequently, the said amount is recoverable from the concerned directors,” the auditors noted.
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