The resignation of Sumit Dhir is proving fatal for the future of AU Small Finance Bank.
AU Small Finance Bank competes with India’s foreign and private banks, with an interest rate of 7.
The exit of the AU Small Finance Bank has led to a sharpening decline in the stocks on Tuesday. The notification released by the Bank highlights that the resignation of the head of the Bank’s internal audit team has come due to some personal reasons related to the pandemic.
The Bank also released the notification after hours and made it known that the impact of Dhir’s resignation has been that the stock closed at 12% down the average.
Bank notified that the reason behind Sumit Dhir‘s resignation was his desire to shift to his hometown, Delhi, due to some personal circumstances closely associated with the second wave of the COVID-19.
The Bank also added that Dhir would continue on rolls as head of Internal Audit, and a discussion is also going on with Dhir for retention.
· There are 50 members in the Internal Audit team of the Bank and seven concurrent editors who are stable for four years. Internal Audit Function is essential because of its insurance of adherence to the internal processes and control as approved by the Board of Directors and designed by the Audit Committee.
- On the 29th of August, left his role as the Chief Risk Officer as disclosed by the Bank
- ·Moreover, the resignation from Gupta came in July only, but the Bank disclosed it in the last week of August.
- The Bank’s chief operating officer, Deepak Jain, also overtake as the Chief Risk Officer.
- Nitin Gupta ended his bond from the Bank that was continuing from 2015 to July this year. He joined the competitor firm of Equitas Small Finance Bank Ltd.
The Bank also notifies that apart from them, no one from the top 50 members has forwarded their resignation.
The location is also proving a hindrance, and very soon, the bank will get transferred to Mumbai from Jaipur. The regional offices will also start at other vital cities of Indore, Chandigarh, Pune, Delhi.
The Bank will organize the investor call on coming Thursday. The address will be done by the board’s Chairman, the Managing director and Chief Executive Officer, and the nomination and remuneration committee chairman.
AU team reported that the Senior management team has an average vintage of around 6.5years with the AU. They also expressed their happiness in creating one of the leading banking franchises in India.
The Bank also tried to enlarge and strengthen its higher management team by hiring people at senior positions in Sales, Audit, Risk, Credit, HR, Tech etc. AU being the largest SFB, has attracted a lot of talent over the last 2-2.5 years.
The Bank proclaimed that the business is doing good according to the earnings based on the Q1 earnings call. The AU has been an example of an attractive destination and franchise for the youth of the country.
The Bank’s asset quality has remained stable for the last two months, and the Bank’s collections have further boosted the confidence.
It instils hope in Bank’s the Bank’s management team that there are still hopes for the Bank’s revival.
The business’s continuation and the asset’s quality also improved over the period, as discerned by the Bank’s officials.