Karnataka Bank MD, ED resign citing personal reasons amid reports of dispute with bank board

New Delhi: Private sector lender Karnataka Bank on Monday said its Managing Director & CEO Srikrishnan Hari Hara Sarma has resigned.

Besides, executive director Sekhar Rao has quit citing his inability to relocate to Mangaluru and other personal reasons, Karnataka Bank said in a statement.

Sarma's resignation comes into effect from July 15. The bank said Sarma cited personal reasons, including his decision to relocate to Mumbai for quitting.

These resignations come amid reports of their dispute with the bank's board.

The bank has formed a search committee to identify suitable candidates for the positions of a new MD & CEO as well as ED, it said.

It has appointed an experienced senior banker as Chief Operating Officer (COO) who will assume charge on July 2, 2025, it said.

Additionally, it said, substitute arrangements are also being made subject to the regulator’s approval.

"On the Notes to Accounts contained in the audited Financial Statements for the FY25 leading to Emphasis of Matter in the Auditor’s Report," it said adding it has been discussed and amicably resolved.

The bank continues to take necessary steps to ensure operational stability and assures stakeholders that it is well capitalised and continues to be sound adding, the transformational journey embarked upon by the bank will continue unhindered.

In a separate filing, the bank said, Karnataka Bank is well capitalized, with a Capital Adequacy Ratio (CAR) of over 19.85 per cent, which reflects the soundness of the bank's financial position and robust risk management practices.

The bank's fundamentals remain strong, and our commitment to transparency, customer service, and ethical governance remains unwavering, it said.

Shares of the bank closed 5.75 per cent down to Rs 195.75 per unit on the BSE.