An image of a Yes Bank hoarding. (Photograph: Dhiraj Singh / Bloomberg)

Yes Bank Director Quits, Saying He's Unhappy With ‘Developments’

(Bloomberg) -- An independent director at Yes Bank Ltd., a lender that’s been ordered by India’s central bank to replace its chief executive officer, resigned on Monday saying he was concerned about recent events at the company.

“I wasn’t happy with the developments taking place in the recent past and the way it was handled,” R. Chandrashekhar, former telecom secretary, said in a message on WhatsApp, declining to be more specific. The lender’s shares slid 6.2 percent on Tuesday, the worst performance on the S&P BSE Sensex index.

The Mumbai-based lender has seen a spate of resignations in the past week as it continues its search for a new CEO to replace the incumbent, Rana Kapoor. Non-executive Chairman Ashok Chawla resigned on Nov. 14, followed the next day by O.P. Bhatt, who quit from the panel set up to find a new CEO.

Yes Bank Director Quits, Saying He's Unhappy With ‘Developments’

In a statement issued Monday, Yes Bank said Chandrashekhar left for personal reasons. In another statement issued later in the day, the lender dropped the reason for his leaving and said it would look for a replacement.

“There are different stories being circulated about why Rentala Chandrashekhar resigned, and why others resigned last week,” said J.N. Gupta, managing director and co-founder of Stakeholders Empowerment Services. “We don’t know what the facts are. In uncertainty the reaction is always panic.”

The Reserve Bank of India has asked co-founder and CEO Kapoor to step aside by the end of January. The authority is taking action against several banks as part of its efforts to root out a system-wide legacy of shoddy lending that has resulted in ballooning bad debts. The regulator earlier this year refused to extend the tenure for the CEO at Axis Bank Ltd.

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