Private lender Federal Bank will soon send the names of potential candidates for the post of managing director and CEO to the Reserve Bank of India (RBI) for the regulator's approval.

The Kerala-based bank’s current CEO Shyam Srinivasan, whose term ends on 22 September, said the board-established search panel is in the advanced stage of submitting the names to the RBI but declined to comment on a specific query on whether KVS Manian would be in the list. 

The panel is looking at a slew of candidates including from inside the organisation, said Srinivasan at a post-earnings press conference.

When Manian recently stepped down from Kotak Mahindra Bank as the joint managing director, speculation arose that he would take over as head of Federal Bank after Srinivasan’s term ends. In his resignation letter, Manian said that he will pursue other opportunities in the financial services sector.

In January this year, the RBI turned down Federal Bank's application for Srinivasan’s extension for a year and directed it to recommend the names of at least two executives for appointment.

It is likely that the bank will include the names of its two executive directors, Shalini Warrier and Harsh Dugar, to be considered for the CEO’s role, among other candidates. 

Meanwhile, Federal Bank reported almost flat net profit at Rs 906 crore for the fiscal fourth quarter ended March 2024 due to higher operating expense. In the year-ago period, the lender’s net profit stood at Rs 903 crore.

Sequentially, the bank’s net profit fell 10% from Rs 1,007 crore in Q3FY24.

Net interest income grew 15% year-on-year to Rs 2,195 crore.

Operating expense rose 41% year-on-year to Rs 1,838.6 crore at the end of the March quarter. Employee costs rose 48% year-on-year to Rs 886.8 crore and other opex rose 34% to Rs 951.7 crore.

The bank’s gross non-performing assets (NPAs) improved by 23 basis points YoY to 2.13%. Net NPA rose by 9 bps to 0.6%.

The company declared a dividend of Rs 1.2 per equity share for FY24.