Reserve Bank says RBL Bank ‘well capitalised’; asks depositors, stakeholders not to react to speculations

Mumbai: Amid concerns over the health of RBL Bank, RBI on Monday assured depositors and stakeholders that the private sector lender is “well capitalised” and that its financial position is satisfactory even as shares of the bank witnessed a sell off.
In a raft of developments in the past few days, Reserve Bank of India (RBI) appointed an additional director to RBL Bank’s board while the lender’s MD & CEO Vishwavir Ahuja was sent to leave.
Against this backdrop, newly-appointed chief Rajeev Ahuja, on Sunday, said the financial position of the bank was strong and that the sudden change at the top level was not related to any concerns.
As concerns persisted, RBI on Monday said there has been speculation related to RBL Bank in certain quarters which appears to be arising from recent events surrounding the bank.
“There is no need for depositors and other stakeholders to react to the speculative reports,” the central bank said and emphasised that the lender’s financial health remains stable.
Shares of RBL took a beating on the bourses and tumbled 18.32 per cent to close at Rs 140.90 apiece on BSE. The scrip also hit its 52-week low of Rs 132.35.
According to RBI, RBL Bank is well capitalised and the financial position of the bank remains satisfactory.
“As per half yearly audited results as on September 30, 2021, the bank has maintained a comfortable Capital Adequacy Ratio of 16.33 per cent and Provision Coverage Ratio of 76.6 per cent,” RBI said in a statement.
Further, it said the Liquidity Coverage Ratio (LCR) of the bank is 153 per cent as on December 24, 2021 as against regulatory requirement of 100 per cent.
“Further, it is clarified that appointment of additional director/s in private banks is undertaken under Section 36AB of the Banking Regulation Act, 1949 as and when it is felt that the board needs closer support in regulatory/supervisory matters,” RBI said.
RBL Bank’s Vishawvir Ahuja stepped down and Rajeev Ahuja was appointed as the interim MD & CEO, a day after RBI appointed its Chief General Manager Yogesh K Dayal as an additional director on the lender’s board.
Dayal, whose appointment is effective from December 24, will stay for two years until December 23, 2023 or till further orders, whichever is earlier.
On Sunday, Rajeev Ahuja said the bank’s financial position was strong and it had full support of RBI and its board of directors.
“We have not been in an extreme good since the last 18 months due to the COVID, it is a reflection of some aspect of the portfolio composition, some aspect of the environment.

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