The government has appointed IDBI Bank CEO Mahesh Kumar Jain as the fourth deputy governor of Reserve Bank of India (RBI), filling up a post that had been lying vacant for almost a year.
With nearly 30 years experience as a career banker, Jain will be in charge of RBI’s banking supervisory department which is instrumental in cleaning up the banking system.
Jain, who is also the managing director of IDBI Bank, had previously led Indian Bank for a couple of years, Rajeev Kumar, secretary (financial services department) at the finance ministry, said in a tweet.
Govt. appoints experienced banker Mahesh Kumar Jain , MD & CEO of #IDBI Bank as Dy. Governor, #RBI for a term of three years . @PMOIndia @FinMinIndia @PIB_INDIA pic.twitter.com/2qzmtOOJ5G
— Rajeev kumar (@rajeevkumr) June 4, 2018
IDBI Bank shares hit a two-week low after Jain was named RBI deputy governor. The stock fell as much as 6.3% to Rs59.70, the lowest since 21 May.
“Jain was working in Indian Bank where there was a turnaround back in 2015 because of his strategies such as sale of non-core assets and reduction of high corporate debt. Then he was transferred to IDBI Bank for its turnaround,” says Yuvraj Choudhary, an analyst at Anand Rathi Securities.
“His exit is negative for (IDBI Bank) stock,” Choudhary added. More than 8.5 million shares of IDBI Bank change hands on Monday, compared with 30-day moving avg of nearly 13 million.
The post of RBI deputy governor was vacant since S.S. Mundra retired in August 2017. The government had since conducted two rounds of interviews to find his successor.
State Bank of India (SBI) managing directors B. Shriram and P.K. Gupta, UCO Bank executive director Charan Singh, skill development secretary K.P.Krishnan, Tamil Nadu principal secretary T.V. Somnathan and NITI Aayog’s additional secretary Yaduvendra Mathura were also in the running for the post.