Uday Kotak to take up non-executive role at KMB
Kotak’s tenure as CEO & MD ends later this year; Kotak Mahindra Bank roped in Egon Zehnder, a global search firm, to search for most suitable candidate
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- Uday Kotak has been leading the bank since its inception in 1985
- He’s a net worth of $13.4 bn
- Uday’s son Jay is out of race as he is likely to follow the normal career path
- RBI capped MD and CEOs’ terms at pvt banks at 15 yrs
- A good number of people moved from executive to non-executive positions especially in the family-run corporates
Mumbai: Uday Kotak, the current Chief Executive Officer and Managing Director (CEO and MD) of Kotak Mahindra Bank, will take the role of a non-executive, non-independent director of the bank after his tenure as CEO ends later this year. At the same time, the efforts have begun to find a successor from among the insiders.
Kotak Mahindra Bank, in a regulatory filing said: “Appointment of Uday Suresh Kotak as Non-Executive Non-Independent Director of the bank upon his ceasing to be the Managing Director & CEO.”
The RBI had capped MD and CEOs’ terms at private sector lenders at 15 years, from October 1, 2021, onwards, but has allowed the serving bank heads to complete their current appointments. Talking to Bizz Buzz, R Gandhi, former Deputy Governor of RBI, says: “As the executive term of Uday Kotak is coming for an end, I understand he will be taking a non-executive role.”
Talking in legal terms, there is no bar. There are a good number of people who have moved from executive to non-executive positions, especially in the family-run corporates. In any case, as a member of the board, one is not supposed to participate in the day-to-day affairs of the bank, he said.
Uday Kotak has been leading the bank since its inception as a non-banking financial institution in 1985.
It became a commercial lender in 2003. Kotak Mahindra Bank had 1,752 branches across India as of the end of 2022. Uday Kotak has a net worth of about $13.4 billion, according to Bloomberg Billionaires Index.
The billionaire banker will transition from his CEO position by the end December this year, after central bank guidelines capped tenures for Indian business heads.
The bank’s board has engaged consulting firm Egon Zehnder to lead a global search for a chief executive officer to replace its billionaire founder Uday Kotak. Group presidents and whole-time directors Shanti Ekambaram and KVS Manian are the potential internal candidates for the top job.
The senior most member of the Kotak Mahindra bank’s management team, next to MD & CEO Uday Kotak, is Dipak Gupta, who is currently the Joint Managing Director. The 60-year-old Gupta, who comes with over three decades of experience, played a key role in the group's foray into banking.
There are two whole-time directors- Shanti Ekambaram and KVS Manian. Manian is a frontrunner to replace Kotak as MD & CEO.
The bank has taken the first step of appointing a new MD & CEO, as Kotak will transition into the position of a non-executive, non-independent director of the bank after the end of his tenure this year. Uday’s son Jay is out of race as he is likely to follow the normal career path.
The bank is already engaging with Egon Zehnder, a global search firm, to help it search the most suitable candidate. It is not known whether the firm would also suggest outsiders for the top job.
As the executive term of Uday Kotak is coming for an end, I understand he will be taking a non-executive role
- R Gandhi, former Deputy Governor, RBI, tells Bizz Buzz
