Tightening the corporate governance norms in the private sector banks, the Reserve Bank of India on Monday said CEOs, MDs and whole-time directors (WTDs) will have to undergo a mandatory three-year cooling period before seeking re-appointment on completion of 15-year term.
The RBI’s latest guidelines may have impact on Kotak Mahindra Bank founder CEO UdayKotak, who has been steering the bank since it got permission from the apex bank in 2003.
Other CEOs who have completed over 10 years are VishwavirAhuja of RBL Bank and ShyamSrinivasan of Federal Bank.
Following this guidelines, AdityaPuri will be the longest-serving CEO of any private sector lender in the country. He headed HDFC Bank for almost 26 years.
The Reserve Bank of India (RBI) has prescribed the maximum age of 70 years for MDs, CEOs and WTDs and 75 years for chairman and non-executive directors (NEDs) in the private sector banks.
These directives form part of the instructions issued by the RBI with regard to the chair and meetings of the board, composition of certain committees of the board, age, tenure and remuneration of directors, and appointment of the WTDs on Monday.
The RBI had issued a discussion paper in June 2020 that proposed capping the tenure of bank CEOs who are promoters or large shareholders at 10 years.