RBI lifts restriction on remuneration of Bandhan Bank MD

Mumbai

The Reserve Bank of India (RBI) has lifted the restriction regarding the remuneration of Bandhan Bank's MD and CEO after the promoter shareholding was brought down to 40 per cent in line with the central bank's norms.

In September 2018, the RBI, among other restrictions, said that the remuneration of the MD and CEO of Bandhan Bank stands frozen at the existing level in view of non-compliance with RBI's licensing norms for new private sector banks.

As per the licensing guidelines, the non-operative financial holding company (NOFHC) was required to bring its excess shareholding to 40 per cent of the paid-up voting equity capital of the bank.

In a regulatory filing on Monday, the bank said: "The RBI vide its communication dated August 17, 2020 has lifted the other regulatory restriction 'the remuneration of the MD and CEO of the Bank stands frozen, at the existing level'."

The bank noted that post the latest decision of the central bank, all the regulatory restrictions imposed by the RBI through the letter dated September 19, 2018 on the bank are now withdrawn.

The development comes a fortnight after Bandhan Financial Holdings Limited lowered its stake in the by 20.95 per cent through a block deal earlier this month.

Post the deal, the holding company's stake in the bank is at 40 per cent.