New Delhi: Shares of RBL Bank tanked as much as 14.98 per cent after its top executive stepped down and the Reserve Bank of India (RBI) appointed an executive to its board. As of 9:59 am, the private lender’s stock fell as much as 15 per cent to its lower price band of Rs 138 on the BSE index.
The central bank has appointed Yogesh Dayal, chief general manager at RBI, as an additional director of RBL Bank for two years.
RBL’s board has accepted a request from Vishwavir Ahuja, managing director and chief executive officer, to proceed on medical leave with immediate effect.
“We wish to mention that the bank is well placed to execute its business plan and strategy as communicated during our earnings call dated October 28, 2021. The business and financial trajectory continues to be on improving trend, post absorbing the challenges due to Covid pandemic,” the bank said.
The financials of the bank remain robust with healthy capital adequacy of 16.3 per cent, high levels of liquidity as reflected through Liquidity Coverage Ratio of 155 per cent, stable net NPA (non-performing asset) of 2.14 per cent, credit deposit ratio of 74.1 per cent and leverage ratio of 10 per cent, for the quarter ended September 30, 2021, it said.
In addition, the bank has also improved the granularity of its deposits and advances, RBL Bank said.
Bank employee unions’ umbrella body AIBEA had written a letter to Union Finance Minister Nirmala Sitharaman expressing concern that everything was not right at RBL Bank and it was going the Yes Bank and Lakshmi Vilas Bank way.
“We are worried and concerned about the developments that are taking place in the affairs of RBL Bank Ltd, the Kolhapur based private bank.
“The sequence of events leading to the sudden exit of Vishwavir Ahuja along with induction of Mr Dayal from RBI on the board as additional member indicates that everything is not ok with the bank,” AIBEA said in its letter to the Finance Minister.
Mr Vishwavir had been heading the private sector bank for the last one decade.
While the board recommended his continuation, it is learnt that RBI has agreed only for a short term up to 2022, AIBEA said further.
There are also reports that the bank has been over indulging in retail credit, micro-financing and credit cards and consequently has burnt its finger resulting in weakening the financials of the bank, it said.