Karnataka Bank : MD & Executive Director Resign Amid Governance Concerns

On June 29, 2025, Karnataka Bank’s MD & CEO, Srikrishnan Hari Hara Sarma, and Executive Director, Sekhar Rao, submitted their resignations citing personal reasons. The board accepted both resignations. Sarma plans to relocate to Mumbai and requested his resignation be effective July 15, 2025. Rao cited his inability to relocate to Mangaluru and other personal factors; his resignation takes effect July 31, 2025

Karnataka Bank : MD & Executive Director Resign Amid Governance Concerns

In May 2025, the bank’s auditors flagged a total of ₹1.53 crore in expenses—covering consultancy and other charges—as exceeding the executives’ delegated authority and not ratified by the board. This triggered internal friction.

The auditors noted the amount is recoverable from the concerned directors, albeit not adjusted in the financials, and issued an “emphasis of matter” in their audit report

The auditors noted the amount is recoverable from the concerned directors, albeit not adjusted in the financials, and issued an “emphasis of matter” in their audit report

The board has set up a search committee to find successors for both roles

Raghavendra Srinivas Bhat has been appointed Chief Operating Officer (COO) effective July 2, 2025, as part of interim operational continuity

Additional substitute measures are being arranged, subject to RBI approval

Karnataka Bank has navigated a high‑profile leadership exit triggered by auditor concerns over unapproved expenses and subsequent board friction. With a proven internal banker stepping in as COO and a formal search process underway,

Shares of Karnataka Bank Ltd. ended 0.4% higher on Friday at ₹208.7. The stock has risen 3.5% in the last one month, but has been an underperformer so far in 2025, with losses of 1.5%.

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