Shikha Sharma to quit as Axis Bank CEO after RBI churns row; 10 points to know

Even as India`s banking sector has been confronted with increased scrutiny amid record-high bad loan levels within the system, the Reserve Bank of India (RBI) has sought to put even individuals under scanner. It had expressed concern over Axis Bank giving a three-year extension to its chief Shikha Sharma and this has led to the curtains being brought down on her position after nearly a decade. Shikha Sharma’s term as the chief executive of Axis Bank will now come to an end by December. Here are the key points related to her decision to step down and the circumstances that led to the creation of such a situation.
 
1 Axis Bank Ltd said on Monday that its long-time Chief Executive Shikha Sharma will step down at the end of 2018, days after the Reserve Bank of India expressed concerns about the lender giving her a three-year extension.
 
2 Axis Bank in a surprise regulatory filing late on Monday, stated that Shikha Sharma, who has been the CEO of the bank since 2009, has asked the bank`s board to shorten her next term that is set to begin on June 1. 
 
3 The board of Axis Bank, the third-biggest private sector Indian bank by assets, accepted Shikha Sharma`s request, pending approval from Reserve Bank of India. 
 
4 Axis Bank had re-appointed Shikha Sharma as CEO last July, for a three-year period starting June 1, 2018. 
 
5 Reserve Bank of India had asked the bank`s board to reconsider Sharma`s three-year reappointment citing concerns over the bank`s asset quality under her reign among other reasons.
 
6 Axis Bank reportedly gave no reason for Sharma cutting short her term and a bank spokesman declined to indicate whether the decision was connected with the recent media reports. Sharma herself made no comment in the regulatory filing.
 
7 Under Shikha Sharma, Axis Bank has witnessed its gross bad loans jump more than six times over the last three years to Rs 250 billion ($3.85 billion) as of end-2017.
 
8 Last year, a central bank audit reportedly unearthed Rs 56.33 billion more in bad loans at Axis Bank than it had originally reported for the fiscal year ended March 31, 2017.
 
9 After the bank board curtailed the fourth term of Sharma to seven months, 29 months ahead of the scheduled term, shares of Axis Bank today rose as much as 4 per cent in morning trade on the bourses.

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10 Authorities concerned have not yet indicated who the successor of Shikha Sharma will be.

(Inputs from Agencies)