IndusInd Bank CEO search looms as shares drop 3.86%

Following the Reserve Bank of India's (RBI's) approval for only a one-year extension to IndusInd Bank's Managing Director (MD) and Chief Executive Officer (CEO) Sumant Kathpalia, instead of the three-year tenor requested by the bank's board, brokerages expect the bank to initiate the process of selecting a new CEO.

- MANOJIT SAHA

Meanwhile, the bank's shares dropped 3.86 per cent on Monday to close at ₹900.6, while broader indices showed only marginal movement.

This is the second consecutive time that the banking regulator has approved a shorter tenor, despite the board requesting a full three-year term.

"In the next few months, we believe the board will likely deliberate over its MD and CEO succession plans, which may include external candidates as well. We foresee heightened uncertainty in the near term, including possible kitchen sinking, and probable names for the MD and CEO position," ICICI Securities said in a note.

On Friday, the private sector lender informed exchanges that the RBI had conveyed its approval for the reappointment of Kathpalia as MD and CEO for a one-year term, extending until March 23, 2026.