Karnataka Bank’s MD, ED resign; bank forms panel to find replacements | Company News – Business Standard

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Following the departure of the MD&CEO and ED, the bank has formed a search committee to identify suitable candidates for both roles

Srikrishnan Hari Hara Sarma, Managing Director & Chief Executive Officer, Karnataka Bank

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Mangalore-based Karnataka Bank said late on Sunday night that its managing director and chief executive officer (MD&CEO), Srikrishnan Hari Hara Sarma, and its executive director (ED), Sekhar Rao, have resigned from their positions, citing personal reasons among other factors. The board of the bank has accepted their resignations.

While Sarma cited personal reasons, including his decision to relocate to Mumbai, his resignation will be effective from July 15. Rao, who cited his inability to relocate to Mangaluru and other personal reasons, will step down with effect from July 31.

Following the departure of the MD&CEO and ED, the bank has formed a search committee to identify suitable candidates for both roles. 

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“The bank has appointed an experienced senior banker as the chief operating officer (COO), who will assume charge on July 2. Additionally, substitute arrangements are also being made, subject to the regulator’s — Reserve Bank of India (RBI) — approval,” the bank said.

Over the weekend, reports emerged that differences between Sarma, Rao and the bank’s board over a certain expenditure incurred by the lender are said to have contributed to the CEO’s decision to step down.

However, the bank, in a statement, said: “On the notes to accounts contained in the audited financial statements for FY25 leading to the emphasis of matter in the auditor’s report, the bank states that it has been discussed and amicably resolved.”

“The bank continues to take necessary steps to ensure operational stability and assures various stakeholders that it is well capitalised and continues to be sound as hitherto. The transformational journey embarked upon by the bank will continue unhindered,” the bank added.