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- Published: September 2, 2023 17:32
New Delhi: Uday Kotak, the veteran leader who played a pivotal role in the remarkable journey of Kotak Mahindra Bank, has officially resigned from his position as Managing Director (MD) and Chief Executive Officer (CEO), effective September 1. This significant development was communicated by the bank itself in an announcement made on September 2.
Uday Kotak, however, will maintain his association with the bank as a non-executive director. It’s noteworthy that his tenure as the bank’s MD and CEO was initially set to conclude on December 31, 2023.
In the interim, Dipak Gupta, the joint MD of Kotak Mahindra Bank, will shoulder the responsibilities of the MD and CEO until December 31, 2023, subject to the approval of the Reserve Bank of India (RBI) and the bank’s members, as revealed in the bank’s official statement.
Uday Kotak took to social media on September 2 to communicate his decision to step down as CEO, citing his primary objective as facilitating a smooth succession plan within the bank.
“Succession at Kotak Mahindra Bank has been foremost on my mind since our Chairman, myself, and Joint MD are all required to step down by year-end. I am keen to ensure a smooth transition by sequencing these departures. I initiate this process now and step down voluntarily as CEO,” said Kotak in his message.
Furthermore, the bank is currently awaiting the RBI’s approval regarding the proposed successor, as stated by Kotak.
A Global Search for a Successor
In February of this year, Bloomberg reported that the bank’s board had engaged consulting firm Egon Zehnder to lead a global search for a new CEO who would succeed its billionaire founder, Uday Kotak.
Uday Kotak has been at the helm of Kotak Mahindra Bank since its inception as a non-banking financial institution in 1985, guiding it through its transformation into a commercial lender in 2003. As per the Bloomberg Billionaires Index, Kotak has a net worth of approximately $13.4 billion.
As of March 31, 2023, Uday Kotak, along with his relatives and entities in which he has a beneficial interest, held 25.95 percent of the equity share capital of the bank and 17.26 percent of the paid-up share capital of Kotak Mahindra Bank Limited.
Continuing as a Non-Executive Director
Uday Kotak, emphasizing his deep attachment to the Kotak brand as its founder, pledged to continue serving the institution in his role as a non-executive director and a significant shareholder. He expressed his unwavering faith in the bank’s outstanding management team, asserting that “Founders go away, but the institution flourishes into perpetuity.”
My letter is attached pic.twitter.com/vcSIEcvy2r
— Uday Kotak (@udaykotak) September 2, 2023
Reflecting on the journey that began 38 years ago, Kotak said, “A long time ago, I saw names like JP Morgan and Goldman Sachs dominate the financial world and dreamed of creating such an institution in India. It is with this dream that I started Kotak Mahindra 38 years ago, with 3 employees in a 300 sqft office in Fort, Mumbai. I have deeply cherished every bit of this memorable journey, living my dream.”
Kotak highlighted the bank’s significant contributions over the years, including creating value for stakeholders and generating over one lakh direct job opportunities. He also noted that an investment of Rs 10,000 in the bank in 1985 would be valued at approximately Rs 300 crore today.
As the baton is passed to a new leadership era at Kotak Mahindra Bank, Uday Kotak’s enduring legacy and his vision for the institution’s future remain central to the bank’s continued success.