Mumbai: UTI Bank’s chairman and managing director P.J. Nayak has offered to resign rather than fall in line with a central bank directive to bifurcate his position, the private sector lender said.
Citing a committee report on corporate governance, the Reserve Bank of India (RBI) had suggested that chairman and managing director must not be the same person.
“Nayak has informed the RBI... that after spending seven and a half years as CMD, it would not be possible for him to function in a different and lesser capacity,” UTI Bank said in a filing to the BSE on Wednesday.
“He will therefore cease to be associated with the bank after 31 July 2007,” it said.
In February, the bank’s board had extended Nayak’s term till July 2009, but the central bank declined to approve saying he could continue as either chairman or managing director, not both.
UTI’s board will meet on 17 April to consider the issue, along with the bank’s quarterly earnings.
“The ball is in RBI’s court. He is still with the bank and the issue would be discussed in the board meeting,” a senior UTI Bank official said.