A watchdog inside Yes Bank

Experts say the appointment of an additional director on its board is RBI's way of having its eyes and ears in the bank

Salil Panchal
Published: May 22, 2019 12:36:00 PM IST
Updated: May 22, 2019 12:42:13 PM IST

Life is not a template and neither is mine. Like several who have worked as journalists, I am a generalist in my over two decade experience across print, global news wires and dotcom firms. But there has been one underlying theme in each phase; life gave me the chance to observe and tell a story -- from early days tracking a securities scam to terror attacks and some of India's most significant court trials. Besides writing, I have jumped fences to become an entrepreneur, as an investment advisor -- and also taught the finer aspects of business journalism to young minds. At Forbes India, I also keep an eye on some of its proprietary specials like the Rich list, GenNext and Celebrity lists. An alumnus of Xavier Institute of Communications and H.R College of Commerce and Economics in Mumbai, I have worked for organisations such as Agence France-Presse, Business Standard, The Financial Express and The Times of India prior to this.

A watchdog inside Yes BankRama Subramaniam Gandhi
Image: Aniruddha Chowdhury / Mint Via Getty Images

In an unprecedented development for Yes Bank, Rama Subramaniam Gandhi, former Reserve Bank of India (RBI) deputy governor, has been appointed to join its board as additional director. The move comes in the backdrop of weak quarterly earnings for Yes Bank in the March-ended quarter (highest ever quarterly net loss and a 51 percent rise in slippages to ₹3,481 crore).

Gandhi’s entry indicates the RBI’s need for an independent assessor at Yes Bank. His focus will be centred on strengthening corporate governance and how the bank’s board advises the management while the management will stay focussed towards lowering NPAs and growing its retail book. 

“The RBI either wants to have its own eyes and ears in Yes Bank and/or wants to provide support to [Ravneet] Gill on the board as all the director appointments were probably influenced by [promoter and former-MD & CEO] Rana Kapoor,” says Hemindra Hazari, an independent banking analyst who publishes his writings on Singapore-based research platform Smartkarma.

Gill took charge after the RBI denied an extension to Kapoor beyond January 31. The RBI had highlighted “serious lapses” in corporate governance and “poor compliance culture” during his tenure. “The RBI needs an internal point within the bank to ensure checks and balances. It had a strong view against the previous management, but not against the bank,” says an economist.

Check out our Monsoon discounts on subscriptions, upto 50% off the website price, free digital access with print. Use coupon code : MON2022P for print and MON2022D for digital. Click here for details.

(This story appears in the 07 June, 2019 issue of Forbes India. To visit our Archives, click here.)

Show More
Post Your Comment
Required, will not be published
All comments are moderated
  • Balwant Kulkarni

    It,s a good move likely

    on May 23, 2019