NSE MD quits just weeks ahead of IPO

Chitra Ramkrishna, a founder-member of NSE, the country's largest stock exchange, resigned as the managing director (MD) of the bourse on Friday



Chitra Ramkrishna, a founder-member of NSE, the country’s largest stock exchange, resigned as the managing director (MD) of the bourse on Friday, just weeks ahead of it filing the draft prospectus to go public.

Ramkrishna, 53, who had joined the National Stock Exchange when it was being set up by the late R H Patil, spent about 23 years with the bourse and quit due to personal health reasons, sources said. An NSE release said that Chitra Ramkrishna stepped down with immediate effect “due to personal reasons”.

Exactly a month ago, she was appointed as the chairperson of the World Federation of Exchanges (WFE), a global industry body for exchanges and clearing houses. In September 2009, Ramkrishna was appointed as the joint MD at NSE and was elevated to the post of MD in April 2013. On Friday, the NSE board appointed J Ravichandran, who was the group president, to officiate as interim CEO. It also decided to set up a selection committee to pick the new MD soon.

According to sources, Ramkrishna’s resignation was partially due to her differences with some of the board members relating to issues which included the exchange’s run-ins with the markets regulator, Sebi. According to a NSE shareholder, Ramkrishna was not able to give as much time to the bourse’s IPO “as was required from the person at the top”.

Along with SBI and its group companies, which is the top shareholder in the bourse, there are several other domestic and foreign financial institutions that hold shares in NSE.

Recently, the NSE board was also summoned by Sebi in a case where a whistleblower had accused some NSE officials of colluding with certain brokers to allow them faster access to information in its trading servers, which had ostensibly given the brokers an undue advantage and netted them substantial profits. A Sebi investigation had found the whistleblower’s allegations to be true and asked the NSE board to rectify the wrongs in that case and also fix responsibility.

Ramkrishna, however, had maintained that NSE’s systems and process were fine and there was no wrong doing on anyone’s part. An NSE appointed panel is currently looking into the matter.

In another case, the exchange had appointed a person at a very high position and at a very high salary. Interestingly, within a few years of his appointment, his salary also rose manifold. There were several complaints with the Sebi against this appointment and also the remuneration of this person. The regulator’s investigation in this matter also found the allegations to be true and it asked the board to address these issues and take appropriate action.