Mahindra Bank’s two whole-time directors, KVS Manian and
, are seen as key internal contenders to succeed Uday Kotak. The former second-in-command, Dipak Gupta, who has taken charge as interim CEO, is ineligible for a director position because of RBI’s cap on tenure for board positions.
On Saturday, Uday Kotak announced that he is stepping down as MD & CEO of the bankhe founded nearly two decades ago, almost four months before his term ends.
While Kotak said that this was aimed at ‘sequencing the top exits’, analysts say an interim CEO may not have the same powers as an RBI and shareholder-approved CEO. RBI requires the candidates to be given at least four months before the term of the incumbent CEO ends.
RBI is expected to clear one of the two candidates for the top job before Gupta’s term ends. The regulator does a thorough “fit and proper” check before approving the name. RBI had in 2021 capped the maximum term for bank CEOs at 15 years and for whole-time directors at 10 years.
Analysts expect the board to have named an inside candidate because Kotak Bank, besides being a lending institution, is also a holding entity for many other businesses, including life & general insurance and asset management. The internal candidates, however, face an age issue since Ekambaram, Manian, and Jaimin Bhatt (group CFO) are all around 60 years old. But this may not be a dealbreaker as RBI has permitted several 60-plus CEOs to continue in office.
A news report from Bloomberg in July, however, stating that RBI has asked the bank’s board to select an external CEO, has created some uncertainty. “So far, general expectations are that either Manian or Ekambaram will be preferred for the CEO’s job when Kotak retires on December 31 and assumes his new role as a non-executive director. This may be a slight negative and adds uncertainty,” said Jefferies in a report issued on July 31.
Uday Kotak resigns as CEO and MD of Kotak Mahindra Bank months before his tenure was to end
Kotak, besides being the founder-CEO, is also the single largest shareholder in the bank. “Jay Kotak (son of Uday Kotak), comes across as a young enthusiast, but he has a long way to go to gain business acumen and democratic leadership skills,” said Emkay Global in a research report on Kotak Bank last year. Jay Kotak, an MBA from Harvard Business School and who was earlier with
, is currently vice president in the bank and co-heads Kotak811 – the digital bank within the bank.
Ekambaram, a veteran who has been with the group for over 30 years, currently heads the consumer banking division of Kotak Bank as president of banking. She has all-round experience, having earlier headed corporate and investment banking, and also having served as CEO of the investment banking unit. She started her career running the trade finance business of Kotak Mahindra Finance, which was one of its core verticals at that time.
Manian, too, has been with the group since 1994, starting with consumer banking before heading the corporate and investment bank. He is currently the whole-time director in charge of corporate, institutional, and investment banking.