New Delhi2 hours ago
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After the resignation of Karnataka Bank’s CEO and Executive Director, today, the bank shares fall down by about 6% on June 30. It is trading at 196 rupees. It made a low of 190 rupees during the trade.
The news of the resignation of the bank’s managing director and CEO Srikrishnan Hari Har Sharma and Executive Director Shekhar Rao came to light late on Sunday night. Srikrishnan Hari Har Sharma has cited personal reasons in his resignation. They told that they want to go back to Mumbai, due to which they took this decision. His resignation will be effective from July 15, 2025.
Sharma has a banking experience of over 40 years. He was appointed the first external CEO for a three -year term by Karnataka Bank in May 2023.
At the same time, Shekhar Rao has resigned, referring to the inability to stay in Mangaluru and other personal reasons. His resignation will be applicable from July 31, 2025. Shekhar Rao was appointed as Executive Director on 1 February 2023 at Karnataka Bank.
He was appointed for three years. Thus, by June 2025, Shekhar Rao was associated with Karnataka Bank for about 2 years and 5 months.
Bank audits raised questions about expenses
However, according to reports, the tension between the board and the management for some time can also be a big reason behind these resignations. In May 2025, the bank’s auditors raised questions about some expenses, including an amount of Rs 1.53 crore.
This expenditure was incurred for appointment of consultants and for other purposes, but did not get the approval of the board. The auditors described it as unauthorized expenses and asked to recover it from the directors concerned. Differences between the board and the management on this issue were revealed.
Bank said- Auditors’ questions are resolved
The bank also informed that some other interim arrangements are being made, which will be subject to the approval of the Reserve Bank of India. In addition, the bank has resolved the questions raised by the auditors in the 2024-25 audited financial statement and there is no dispute about it.
Bank formed a search committee for new appointment
After these resignations, Karnataka Bank has taken immediate action and formed a search committee for the appointment of new MD and CEO as well as executive director. This committee will search for appropriate candidates as soon as possible so that the functioning of the bank continues smoothly.
Along with this, the bank has appointed Raghavendra Srinivas Bhat as Chief Operating Officer (COO), who will take over from July 2, 2025. Raghavendra is an experienced banker and will work at the bank’s headquarters in Mangaluru.
Investors’ confidence due to leadership change
These resignations also saw the impact on Karnataka Bank shares. The bank shares fell to 6%. Market experts say that such sudden leadership changes and audit questions have shocked the trust of investors.
ICICI Securities said in its report that the incident questions the bank’s corporate governance and internal controls, which may reduce the trust of investors.