The government has extended the tenure of Uday Kotak on the board of Infrastructure Leasing & Financial Services (IL&FS) by 1 year with effect from 3 October. Under the Banking Regulation Act, 1949, a bank cannot be managed by a person who is a director of any other company. It can, however, be given a temporary exception for 3 or 9 months if so, recommended by the Reserve Bank of India. Kotak was given a go-ahead for 3 months initially, which was followed up with a 9-month relaxation that ended on 2 October. The government issues a gazette notification stating the statutes will not apply to Kotak Mahindra Bank in so far as it relates to its MD and CEO Uday Kotak being on the board of ILFS as its non-executive director for a period up to 2 October 2020. It is significant that this is the first time RBI is giving the government a go-ahead to give an extension to a bank CEO, allowing him to continue as chairman of another financial institution.
