Shares of IndusInd Bank fell 5% to Rs 1,084 in intraday trade on Monday after the Reserve Bank of India (RBI) approved the reappointment of Mr Sumant Kathpalia as MD & CEO for two years, board approval for three years.

“The underlying strength and strategy to improve the business mix remain on track. However, the central bank’s approval for the reappointment of managing directors and CEOs for shorter terms compared to the three years approved by the board may weigh on stocks soon, ICICI Securities said in a report.

Kathpalia’s re-election is effective March 24, 2023. His current term will end on March 23, 2023.

IndusInd Bank has underperformed the market over the past three months, falling 12% compared with a 5% drop for the S&P BSE Sensex.

Shares of IndusInd Bank have been under pressure due to macro uncertainty and clarity on the extension.