Following the completion of the acquisition of 51 per cent controlling stake by the Life Insurance Corporation of India (LIC) in IDBI Bank, the life insurance behemoth will have five representatives on the bank’s board, while the government will have two.
Further, to ensure continuity at the top, LIC will persist with the bank’s present top management till such time as the latter’s board approves appointment of a new MD & CEO and DMDs on the board after following the due process.
According to IDBI Bank’s Articles of Association, which has come into effect on January 21, 2019, the bank’s new board will comprise: Chairman of LIC (as an ex-officio Non Executive Non Whole-time Chairman of IDBI Bank); a whole-time Managing Director & CEO nominated by LIC; two whole-time Deputy Managing Directors (DMDs) nominated by LIC; an Official nominee Director of LIC; two nominee Directors of the Government of India; and eight non-rotational independent Directors appointed by shareholders in the general meeting.
The Managing Director & CEO and the whole-time directors will hold office for such term not exceeding five years as LIC may specify in this behalf and any person so appointed will be eligible for reappointment, subject to such regulatory approval as may be required under the Companies Act, Banking Regulation Act or any other act in force.
Meanwhile, in terms of LIC’s letter dated January 18, 2019, the board of IDBI Bank on Monday approved the continuation of office of Rakesh Sharma, K. P. Nair and G. M. Yadwadkar as Directors and as MD & CEO and DMDs respectively of IDBI Bank till such time as the board approves appointment of a new MD & CEO and DMDs on the board of IDBI Bank after following the due process.
Further, IDBI Bank’s board also approved the appointment of Rajesh Kandwal, Director and CEO of LICHFL Care Homes Ltd, as an Additional Director and LIC’s Nominee Director on the board of the Bank.