Paytm's Vijay Shekhar Sharma steps down from board of payments bank (updated)

Central Bank of India

26/02/2024 15:04

(Adds details on board rejig, background in paragraph 2)
       BENGALURU, Feb 26 (Reuters) - India's Paytm  PAYT.NS 
said on Monday Vijay Shekhar Sharma would step down as
non-executive chairman and board member of its payments bank's
unit, as the embattled digital payments company overhauls its
board after a central bank clampdown.
    The action against Paytm Payments Bank followed "serious
supervisory concerns", including inadequate customer identify
and a lack of arms length distance with Paytm, sources had told
Reuters.
    The Reserve Bank of India has asked the banking unit to wind
down its operations by March 15 due to persistent
non-compliances and continued material supervisory concerns,
triggering a meltdown in Paytm's stock.
    Srinivasan Sridhar, former chairman of state-owned Central
Bank of India  CBI.NS , former Bank of Baroda  BOB.NS  Executive
Director Ashok Kumar Garg and two retired Indian Administrative
Service officers will join the board, Paytm said in an exchange
filing.
    The new board members' expertise will be "pivotal in guiding
us toward enhancing our governance structures and operational
standards, further solidifying our dedication to compliance and
best practices", Paytm Payments Bank CEO Surinder Chawla said.
    Paytm supports its banking unit's move of opting for a board
with only independent and executive directors by removing its
nominee, it said, adding Sharma was also stepping down from the
board to "enable the transition".
    Sharma owns a 51% stake in Paytm Payments Bank, while One 97
Communications, as Paytm is formally known, owns the rest. 

 (Reporting by Chris Thomas in Bengaluru; Editing by Shounak
Dasgupta and Arun Koyyur)
 ((chris.thomas@thomsonreuters.com))