Karnataka Bank’s Leadership Shake-Up: 5 Key Developments in 2025

Mangaluru, July 01, 2025: Karnataka Bank Ltd, the century-old private lender in Mangaluru, is back in the spotlight after a flurry of top-level changes. The resignations of its top executives and the appointment of a new Chief Operating Officer (COO) mark a pivotal moment for the bank. Here are five key developments that highlight Karnataka Bank’s response to these changes and its commitment to growth and stability in 2025.

1. Resignation of MD & CEO Srikrishnan Hari Hara Sarma

The bank’s Board has accepted the resignation of Managing Director & CEO Srikrishnan Hari Hara Sarma, with his exit effective July 15, 2025. Sarma, who took over in June 2023, says he’s stepping down for personal reasons—word is, he’s heading to Mumbai. During his brief but eventful stint, Sarma steered the bank through a major fundraising drive, pulling in Rs 1,500 crore—Rs 600 crore of that via qualified institutional placements. The move has strengthened Karnataka Bank’s balance sheet at a critical time, even as leadership reshuffles keep investors and customers on their toes. With a new COO stepping in, all eyes are on Karnataka Bank’s next chapter as it reassures stakeholders about its growth and stability plans for 2025.

2. Executive Director Sekhar Rao Steps Down

Executive Director Sekhar Rao has handed in his resignation, set to leave by July 31, 2025. Official word is, he could not move to Mangaluru and had some personal stuff going on. Rao, who got on board in February 2023, had a hand in shaping the bank’s operations. Now, with both top executives quitting at once, investors are not happy—shares took an 8% nosedive on June 30, 2025, ending the day at Rs 195.75 on the BSE.

3. Search Committee Formed for New Leadership

Karnataka Bank has set up a search committee to find the next Managing Director & CEO, along with an Executive Director. It is a serious move—clearly, they want solid leaders at the helm to keep things on track. The Reserve Bank of India is keeping a close watch, so expect a detailed and transparent process.

4. Raghavendra Srinivas Bhat Appointed as COO

In a notable development, the bank has tapped Raghavendra Srinivas Bhat as Chief Operating Officer, with his term beginning July 2, 2025. Bhat brings more than 35 years of banking experience to the table, including a solid decade in top leadership positions at Karnataka Bank. Often referred to as the “clerk-turned-COO,” Bhat’s elevation underscores the bank’s commitment to nurturing internal talent and maintaining stability during this period of transition.

5. Assurance of Financial Stability and Governance

Despite some recent leadership shake-ups, Karnataka Bank is making a big show of confidence in its financial stability. The bank’s Capital Adequacy Ratio has hit 19.85%, way above the minimum required by regulators. There was a bit of a hiccup—auditors flagged a Rs 1.53 crore expense for FY25—but the bank says that’s all sorted now, no hard feelings. Karnataka Bank is sticking to its usual script, stressing transparency, ethical leadership, and business stability. Their message to customers? Your money’s safe. No need to worry.

Karnataka Bank’s swift response to these leadership changes, coupled with its strong financial foundation, positions it to navigate this transitional phase effectively. As the search for new leadership continues, the bank remains focused on its transformational journey, serving over 11 million customers across 957 branches nationwide.

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