Shares of RBL Bank tumbles 25 per cent over CEO‘s sudden 'medical leave'; RBI appoints additional director

The sudden departure of Vishwavir Ahuja on account of medical leave made the speculation loom heavy over the deteriorating financial health of the bank.

The private sector bank saw the steepest fall in its share price today over the news of RBI appointing Yogesh Dayal as an Additional Director on the Board of the Bank for a period of two years till December 23, 2023, or till further orders, whichever is earlier. 

The sudden departure of Vishwavir Ahuja on account of medical leave made the speculation loom heavy over the deteriorating financial health of the bank. 

RBL Bank in its press release stated that it has appointed Rajeev Ahuja (existing Executive Director of the Bank) as the Interim Managing Director and CEO of the Bank subject to regulatory and other approvals while making an effort to allay concerns on the strategy and smooth functioning of the Bank as well as the strength of the overall franchise. 

The board, however, maintained that these developments are not on account of any concern on advances, asset quality and deposits level of the bank. The company claimed to be on track with their guidance of one per cent ROA in Q4 and net NPA below two per cent while reducing its cost of credit. 

Taking a cue from RBI's past interventions, such moves were mainly driven by concerns over corporate governance or the financial health of banks. 

Following the press release, the share tumbled by 25 per cent to log its 52-week low of Rs 130.20 on Monday. The shares of RBL Bank are currently trading at Rs 146.20 at 12.36 pm on BSE.