The board of Axis Bank, on Tuesday, 10 July, shortlisted three candidates who could succeed Shikha Sharma as managing director and chief executive officer, after she steps down in December.
The board will now send the list of candidates, in order of preference, to the Reserve Bank of India for approval, Axis Bank said in its filing with the stock exchanges. Once the banking regulator selects a candidate, the process of succession will begin.
The notification did not state who these three candidates were and whether any of them were from within the bank.
In April, Sharma had announced her decision to step down from the position of MD and CEO by the end of this calendar year. While announcing the bank’s March quarter results, Sharma had said that whoever takes over after her as the chief of Axis Bank will have an exciting journey ahead.
Sharma’s move was surprising because in July 2017, well before her current term was supposed to end, the board had announced her reappointment for another three years.
After she announced her decision to step down from the leadership role at Axis Bank, the board had said that it had accepted her decision and was in the process of identifying the right successor.
The bank had roped in leadership advisory firm Egon Zehnder to find these candidates, it had said in a stock exchange filing in April.
The bank has witnessed a spike in its bad loans and drop in its profitability after the banking regulator conducted its asset quality review in October 2015.
The bank’s gross non-performing asset ratio climbed to 6.77 percent in March 2018, as compared to a little over 5 percent a year ago. The ratio of gross bad loans stood at 0.96 percent in 2009.
In the past, senior officials from the bank, including Sharma, have admitted that the asset quality deterioration was due to the bank’s infrastructure bets over the last few years that have not paid off.
(This article was first published on BloombergQuint and has been republished with permission.)