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Uday Kotak Steps Down as Kotak Mahindra Bank’s CEO and Managing Director




Uday Kotak, the billionaire founder of Kotak Mahindra Bank and India’s richest banker, surprised the financial sector by announcing his resignation as the Managing Director and Chief Executive Officer, four months ahead of his term’s conclusion. According to the bank’s statement to the stock exchange on Saturday, the departure is attributed to personal reasons.

Reasoning Behind The Decision

In letters addressed to India’s exchanges and Prakash Apte, Chairman of the Board of Directors, Kotak mentioned, “I have mulled over this decision for some time and believe it is the right thing for the institution.” Stressing the importance of a smooth transition, Kotak highlighted that the current Chairman, himself, and the Joint MD all have terms ending by the year’s close. “I thought it appropriate to hand over the baton and stagger the transition,” he added.

Interim Leadership & Future Succession

  • Dipak Gupta, the present Joint Managing Director, will assume the role of CEO and MD, subject to necessary approvals, and will hold the position until December 31.
  • Kotak Mahindra Bank has forwarded an application for the new managing director to India’s central bank, the Reserve Bank of India (RBI).
  • The RBI, being the regulatory authority, holds the power to approve top positions at Indian lenders.
  • It was earlier reported by Bloomberg News that the regulator has advised the bank to consider candidates outside its current structure for the succeeding role. In response, the bank engaged global consulting firm Egon Zehnder to aid in the worldwide CEO search. Top executives Shanti Ekambaram and K.V.S. Manian were identified as internal candidates.

Uday Kotak’s Legacy and Future Role

Revered for obtaining a banking license in 2003, Uday Kotak joined the ranks of ICICI Bank and HDFC Bank as one of the early private entrants in India’s banking sector. His astute risk management strategies shielded Kotak Mahindra Bank from the detrimental loan cycle affecting many Indian banks since 2013. Under his leadership:

  • The bank registered a mere 1.78% in gross bad loans as a percentage of total assets.
  • Its stock trades at a price-to-book ratio of 4.2 times, equivalent to HDFC, India’s largest private lender, and surpassing ICICI Bank’s 3.38 times.
  • Uday Kotak has also become a crucial figure for the Indian government during financial crises, notably spearheading the bankruptcy procedure for the Indian infrastructure conglomerate IL&FS in 2019.

However, it wasn’t always smooth sailing. In 2018, a confrontation with the RBI saw Kotak challenging a directive to reduce his bank’s shareholding to 26%. Despite stepping down, Uday Kotak intends to retain a prominent position within the institution. On social media platform X, formerly known as Twitter, he remarked, “Founders go away, but the institution flourishes into perpetuity”. He confirmed his future association with the bank as a non-executive director and a significant shareholder.

Beyond Banking

Uday Kotak’s vision extends beyond mere financial services. For 38 years, he has led the group in a broad spectrum of financial services, emphasizing sustainable value creation. Additionally, the Kotak Education Foundation, an initiative of the group, focuses on uplifting some of India’s most economically challenged communities. The foundation’s mission is to eradicate poverty through educational and livelihood programs.

Market Analysts Weigh In

The sudden resignation was met with mixed reactions in the financial sector. While Amit Tandon, CEO of Institutional Investor Advisory Services, believes an external candidate for the CEO position might require significant adjustments, Anand Dama from Emkay Global Financial Services sees the early application for a successor as an indication that the bank might be considering an internal candidate.


Uday Kotak’s unexpected decision marks the end of an era for Kotak Mahindra Bank. However, with a robust succession plan in motion and his continued involvement, the institution seems poised for continued success.