RBI tells Dhanlaxmi to defer appointment

Arun Rao was named to bank’s board

An Indian pedestrian walks out of The Reserve Bank of India (RBI) building in Mumbai on April 29, 2008. India's central bank held key interest rates steady but hiked the percentage of cash banks must hold in reserve to 8.25 percent to curb inflation riding at over three-year highs.It was the second time the Reserve Bank of India had announced an increase in the cash reserve ratio (CRR) in two weeks as it seeks to suck out excess liquidity in the banking system and fight inflation now at 7.33 percent. AFP PHOTO Sajjad HUSSAIN

The Reserve Bank of India (RBI) has directed private sector lender Dhanlaxmi Bank to keep the appointment of a non-independent director in abeyance till further orders.

“It is hereby informed that Reserve Bank of India vide letter dated May 16, 2018, has advised the bank that the proposal for the appointment of Arun Rao M. G. as a non-independent director on the board of the bank may be kept in abeyance, till further advice,” Dhanlaxmi Bank informed the exchanges without citing any reason for the regulatory action.

On May 15, the Thrissur-based lender had appointed Mr. Rao as an additional non-independent director.

Director quits

On the same day, G. Vijaya Raghavan, an independent director on the bank’s board, had resigned.

The bank had deferred it’s quarterly and annual earnings announcement to May 23 from May 15 for “better representation on conservative basis”.