Paytm Payments Bank crisis: Vijay Shekhar Sharma steps down as PPBL Chairman; board reconstituted

PTI | New Delhi | Updated: 26-02-2024 22:26 IST | Created: 26-02-2024 22:23 IST
Paytm Payments Bank crisis: Vijay Shekhar Sharma steps down as PPBL Chairman; board reconstituted
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Vijay Shekhar Sharma has stepped down as part-time non-executive Chairman of Paytm Payments Bank Limited and the board of the bank has been reconstituted, a filing said on Monday adding PPBL will commence the process of appointing a new Chairman.

The dramatic turn of events assumes significance in the backdrop of RBI's crackdown on the Paytm Payments Bank over persistent non-compliance and continued material supervisory concerns.

Last month, in a regulatory action the central bank barred PPBL from accepting fresh deposits or top-ups in customer accounts, wallets, FASTags and other instruments after February 29 - a deadline that was later extended to March 15.

In a release on Monday, One 97 Communications informed that its associate entity Paytm Payments Bank Limited (PPBL) has reconstituted its Board of Directors with the appointment of Ex-Central Bank of India Chairman Srinivasan Sridhar, retired IAS officer Debendranath Sarangi, former Executive Director of Bank of Baroda Ashok Kumar Garg, and former IAS officer Rajni Sekhri Sibal.

They have recently joined as Independent Directors, it elaborated.

One97 Communications Ltd (OCL) is the owner of the Paytm brand. One97 Communications holds 49 per cent of the paid-up share capital (directly and through its subsidiary) of PPBL. Vijay Shekhar Sharma has a 51 per cent stake in the bank.

OCL said it supports PPBL’s move of opting for a board with only independent and executive directors by removing its nominee.

''The company has been separately informed that Vijay Shekhar Sharma has also resigned from the Board of Paytm Payments Bank to enable this transition. PPBL has informed us that they will commence the process of appointing a new Chairman,'' the filing said.

Srinivasan Sridhar brings with him an illustrious career in banking spanning over 40 years, the release said adding he is currently serving as the Independent Director at Jubilant Pharmova. He has held leadership positions at Export Import Bank of India, Central Bank of India and National Housing Bank.

Sarangi, retired IAS (1977 batch) of Tamil Nadu cadre, is a veteran in public administration and corporate governance, and is currently serving as an Independent director on the boards of several companies including Southern Petrochemical Industries Corporation Limited and Voltas Ltd, among others.

A retired IAS officer of Haryana cadre (1986 batch) with 38 years of experience in administration and governance, Sibal has served as Secretary in Government of India.

Currently, she serves as an Independent External Monitor in the Public Sector and as an Independent Director in Corporates.

Garg brings almost four decades of diverse banking experience and has held significant positions including whole-time Director at Bank of Baroda, Chief Executive for USA operations of the bank at New York, Managing Director of Bank of Baroda (Uganda) Ltd at Kampala and Chairman/Director of its subsidiaries in Guyana, Trinidad and Tobago and Kenya.

Beyond these, the board has former Executive Director of Punjab & Sind Bank Shri Arvind Kumar Jain as Independent Director and Surinder Chawla, MD and CEO at Paytm Payments Bank.

Paytm Payments Bank CEO Chawla welcomed the appointments saying it marked a significant step forward in PPBL's journey.

''Their distinguished expertise will be pivotal in guiding us toward enhancing our governance structures and operational standards, further solidifying our dedication to compliance and best practices,'' Chawla said.

Newly-appointed Board Member Sridhar said it is his goal to ensure that PPBL becomes a paragon of regulatory compliance, setting new standards in delivering exceptional value to the stakeholders, in strict adherence with regulatory frameworks and best practices.

''I am dedicated to utilising my extensive banking expertise to steer the bank towards expanding its range of compliant services,'' he said.

Sarangi pledged his commitment to applying his expertise to navigate PPBL towards a future characterised by operational excellence, ensuring strict compliance with regulatory guidelines and fostering a culture of best practices.

''Assuming this expanded role at a critical juncture for PPBL, my dedication is firmly rooted in adhering to and exceeding the highest standards of regulatory compliance and corporate governance,'' Sarangi added.

On Friday, Reserve Bank had advised the National Payments Corporation of India (NPCI) to examine the possibility of migrating Paytm Payments Bank customers using the UPI handle '@paytm' to 4-5 other banks, in a bid to prevent any disruptions in the payment ecosystem.

As per the website of Paytm Payments Bank (PPBL), it has 30 crore wallets and 3 crore bank customers.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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