Governance

Documents/Reports Review and Financial Reporting Process

• Review and update this Charter, considering regulatory requirements, business environment, etc. and place it before the Board of Directors of the Bank for its approval. The frequency of review shall be atleast once every three years.
• Oversight of the Bank’s financial reporting process and the disclosure of its financial information to ensure the fair presentation of financial statements in accordance with accounting principles generally accepted in India, applicable regulatory requirements and provisions of Companies Act, 2013.
• Review the organization’s annual financial statements and any reports or other financial information submitted to any regulatory body, or the public, including any certification, report, opinion, or review rendered by the independent auditors or firm of accountants.
• Review, with the management, the annual financial statements and auditor’s report thereon before submission to the board for approval, with particular reference to:
  • Matters required to be included in the Director’s Responsibility Statement to be included in the Board’s report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act, 2013.
  • Changes, if any, in accounting policies and practices and reasons for the same
  • Compliance with accounting standards, selection of accounting policies, significant judgements, estimates and assumptions that affect reported amounts in financial statements.
  • Significant adjustments made in the financial statements arising out of audit findings
  • Compliance with regulatory guidelines, Securities and Exchange Board of India and other legal requirements relating to financial statements
  • Disclosure of any related party transactions
  • Approve or ratify transactions of the Bank with related parties and review significant transactions and matters related thereto. Grant of omnibus approval for related party transactions proposed to be entered into by the Bank subject to such conditions as prescribed and as amended from time to time. Related Parties to have the same meaning as provided in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended from time to time).
  • Modified opinion(s)  in the draft audit report
  • Going concern assumption
  • Management discussion and analysis of financial condition and results of operations.
• Review, with the management, the quarterly financial statements / results before submission to the Board for approval.
• Reviewing, with management, the statement of uses / application of funds, wherever necessary, raised through an issue (public issue, right issue, preferential issue etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public of right issue, and making appropriate recommendations to the Board to take up steps in this matter wherever necessary.
• Review compliance with the provisions of the SEBI (Prohibition of Insider Trading) Regulations, 2015 (as amended from time to time) at least once in a financial year and verify that the systems for internal control pertaining to the same are adequate and are operating effectively. (amendment effective from 1st April 2019)
• Valuation of undertakings or assets of the Bank, wherever it is necessary;
• Review evaluation of internal financial controls and risk management systems.
• Look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non payment of dividend declared) and creditors.
• Approval of appointment of CFO after assessing the qualifications, experience and background, etc. of the candidate;
• Review reasons for revenue leakage and approve corrective action plan and monitor them at regular interval.  Monitor areas of repeat occurrences, if any and ensure immediate actions are taken to prevent such repeat occurrences of revenue leakage.
• Review the financial statements of unlisted subsidiary company/ies and more particularly the investments made by them.
• Review the key audit observations pertaining to the subsidiaries presented to the respective ACB / Board, as the case may be.
• Reviewing the utilization of loans and / or advances from / investment by the Bank in the subsidiary exceeding Rs.100 crore or 10% of the asset size of the subsidiary, whichever is lower including existing loans / advances / investments.
• Review details presented to the Committee, at prescribed frequency, vide RBI circular dated 10 November 2010 and as updated from time to time.
• Discuss with independent statutory auditors significant issues raised in the Long Form Audit Report and follow up there on.

Independent Statutory Auditors

• Recommend to the Board of Directors the appointment, re-appointment, replacement and removal of the independent statutory auditors for both domestic and overseas operations, considering independence and effectiveness, terms of appointment, the fees and other compensation to be paid to the independent statutory auditors.
• Approval of payment to statutory auditors for any other services rendered by the statutory auditors.
• Approve all payments for services rendered to the statutory auditors other than as statutory auditors.
• Review and monitor, auditors’ independence performance and effectiveness of audit process.
• Periodically consult with the independent statutory auditors in the absence of management about internal controls and fair presentation of financial statements in accordance with accounting principles generally accepted in India, applicable regulatory requirements.
• Discuss with the independent statutory auditors before commencement of the audit the nature and scope of the audit.
• Discuss and ascertain from the independent statutory auditors post the completion of the audit, areas of concern, if any.
• Review management letters / letters of internal control weaknesses issued by the statutory auditors.
• Provide a right to be heard to the independent statutory auditors and the key management personnel in the meetings of the Audit Committee.

Internal Audit Department

• Approve appointment, re-appointment, replacement and removal of the concurrent auditors and outsourced internal auditors and the fees and other compensation to be paid to them.
• Review with management, performance of internal auditors and adequacy of the internal control systems.
• Review the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure, coverage and frequency of internal audit including Information Systems Audit.
• Discuss with internal auditors any significant findings and follow up there on.
• Review the internal audit reports relating to internal control weaknesses.
• Review the findings of any internal investigations by the internal auditors / vigilance department into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and report the matter to the Board of Directors.
• Approve, review and monitor the Risk Based Internal Audit Plan each year.
• Review appointment, removal, and performance of Head – Internal Audit and detailed organisation structure.

Whistleblowing/ Vigil mechanism

• The Committee shall review the Bank’s mechanism for its directors, employees and vendors to raise genuine concerns; whether it provides adequate safeguards against victimization of persons who use such mechanism and provides for direct access to the Chairman of the Audit Committee in appropriate or exceptional cases.
• Review Statement of deviations, if any:
  • quarterly statement of deviation(s) including report of monitoring agency, if applicable, submitted to stock exchange(s) in terms of Regulation 32 (1) of SEBI LODR.
  • annual statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice in terms of Regulation 32(7) of SEBI LODR.
  • Read the audit inspection reports of the inspection team of Reserve Bank of India or any other regulator, approve action plans for corrective actions to be taken and monitor compliance thereof.
  • Review the implementation and effectiveness of the financial and Risk Management policies and process and highlight any gaps observed to the Board of Directors.
  • Establish a process of reporting by the Management or Independent Statutory Auditor, as the case may be, to the Audit Committee with regard to any significant judgment made in preparation of the Financial Statements along with their views on appropriateness of such judgments.
  • Following completion of the annual audit and internal audit plan, review separately with each of management, the independent statutory auditors and the internal auditing department any significant difficulties encountered during the course of the audit, including any restrictions on the scope of work or access to required information.
  • Review any significant disagreement among management and the independent statutory auditors in connection with the preparation of the financial statements.
  • Review any significant disagreement among management and the internal audit department in connection with the observations made in the internal audit report.
  • Review with Management the extent to which changes or improvements in financial or accounting practices, as approved by the Audit Committee, have been implemented.
  • Perform any other activities consistent with this Charter and governing law, as the Committee or the Board deems necessary or appropriate.

  Chairman:
  Mr. Uday Khanna
  

  Members:
  Mr. Prakash Apte
  Prof. S. Mahendra Dev
  

 

The Stakeholders Relationship Committee of the Bank reviews the complaints received from the shareholders and ensures redressal thereof. The constitution and composition of the Committee is in accordance with the provisions of Regulation 20 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

• To resolve grievances of security holders.
  
• To review measures for effective exercise of voting rights by shareholders.
• To review adherence to service standards adopted by listed entity for services rendered by R & T Agent
• To review measures and initiatives taken for reducing quantum of unclaimed dividend and ensuring timely receipt of dividend / annual report / statutory notices.

Chairman:
Prof. S. Mahendra Dev

Members:
Mr. Uday Kotak
Mr. Dipak Gupta 
Mr. C. Jayaram

• Identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal and specify the manner for effective evaluation of performance of Board, its committees and individual directors to be carried out either by the Board, by the Nomination and Remuneration Committee or by an independent external agency and review its implementation and compliance.
• Formulate the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other employees.
• While formulating the policy ensure that—
  • the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully;
  • relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and
  • remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals.
• To recommend to the Board remuneration (in whatever form payable) to senior management.

Chairman:
Mrs. Farida Khambata

Members:
Mr. Prakash Apte
Mr. C. Jayaram

• To approve transfer, transmission, transposition, name deletion, consolidation and splitting of share and debenture certificates of the Company.
• To issue duplicate share/debenture certificates.
• To apply for registration of the Company with various authorities of any state or Centre including GST tax authorities, income tax authorities, shops & establishment authorities, and to do or perform all matters relating to such matters.
• To apply, in the name of and for the Company for telephone, telex, fax and other telecommunication and electrical/electronic connections and to do all matters relating to such applications.
• To open, operate and close Bank Accounts of the Company and change the operating instructions of existing Bank Accounts of the Company.
• To authorise persons to sign on behalf of the Company Share Certificates, Share Allotment Letters, Fixed Deposit Receipts.
• To authorise persons to represent the Company at General Meetings of any company or cooperative society of which the Company is a shareholder/member.
• To fix the dates for Closure of the Company’s Register of Members and Debenture holders and Transfer Books of Shares or Debentures and/or fixing Record Dates, in consultation with the Stock Exchanges.
• To authorise the opening of Securities General Ledger Account or any other account with any scheduled banks or with any department of the Reserve Bank of India.
• To authorise persons to execute Loan Agreements, Demand Promissory Notes and any other documents as may be necessary for lending out of any line of credit sanctioned to the Company.
• To authorise officials of the Company to sign documents for registration of motor vehicles and to do all acts and things for the transfer of any such motor vehicles.
• To authorise employee(s) or others to execute, for and on behalf of the Company, agreements, applications, deeds, documents and any other writings in connection with the business of the Company and, if required, to issue Power of Attorney in favour of such persons for the purpose.
• To authorise employee(s) or others to represent the Company before any Court, Tribunal, Consumer Redressal Forum or any Statutory or other Authority on any matter relating to the operations of the Company or with which the Company is in any way connected or to represent the Company generally or for any specific purpose or purposes and, if required, issue Power of Attorney in favour of such persons for the purpose.
• To appoint or change nominees to hold shares for and on behalf of the Company in any subsidiary/associate companies.
• To grant permission and authorise incorporation of companies, with a prefix “Kotak Mahindra” before the name.
• To authorise the use of the Common Seal of the Company and to appoint persons to sign/countersign documents, etc. on which the Common Seal is to be affixed
• To approve appointment of any employee /Director of the Bank or any other person as a nominee on the Board of other companies under certain circumstances to protect the interest of the Bank’s exposures / investments in such companies;
• To approve appointment of any employee of the Bank as a part-time employee of any other company under certain circumstances to protect the interest of the Bank’s exposures / investments in such companies; and
• To approve appointment of any employee /Director of the Bank or any other person as an appointee on the Board of other companies (including Section 8 companies) LLPs, firms, if so invited.
• To carry out the following activities in respect of equity shares of erstwhile ING Vysya Bank Ltd. being rights shares held in abeyance for various reasons :
  • Allotment of shares in respect of rights shares held in abeyance and bonus entitlement thereon, after the resolution of the Court case, transmission, dispute etc. as the case may be and upon receipt of application money and other necessary documents.
  • Authorize officials of the Bank to take necessary action for credit of shares to the demat account of the concerned shareholder(s) or issue of physical share certificates as the case may be.
  • Authorize officials of the Bank to make the necessary applications to the Stock Exchanges for listing and trading of the shares so allotted, file the various regulatory returns and refund the excess share application money received, if any.
• To authorise employee(s) to delegate authority to any other employee(s) or others in respect of any of the matters stated herein subject to it being permissible under applicable law.”

Chairman:
Mr. Uday Kotak

Members
Mr. C. Jayaram
Mr. Dipak Gupta

Pursuant to the directives of the Reserve Bank of India, the Bank has constituted a Committee on Frauds for monitoring and reviewing all the frauds involving amounts of ` 1 crore and above.

Members

• Mr. Uday Kotak
• Mr. Dipak Gupta
• Mr. Prakash Apte
• Mr. Uday Chander Khanna
• Mr. C. Jayaram

The Bank has, pursuant to the directives issued by the Reserve Bank of India, constituted a Customer Services Committee. The Committee has been constituted to bring about ongoing improvements in the quality of customer services provided by the Bank. The Committee would also oversee the functioning of the Customer Service Standing Committee, compliance with the recommendations of the Committee on Procedures and Performance Audit and Public Services (CPPAPS) and also mount innovative measures for enhancing the quality of customer service and improving the level of customer satisfaction for all categories of cliental, at all times.

Chairman:
Prof. S. Mahendra Dev

Committee Members:
Mr. Uday Kotak
Mr. Dipak Gupta

• Formulate and recommend to the Board, a Corporate Social Responsibility (CSR) Policy which shall indicate the activities to be undertaken by the Bank, as laid down in Schedule VII to the Act;
• Recommend the amount of expenditure to be incurred on the CSR activities;
• Monitor Bank's CSR Policy and implementation of CSR projects undertaken from time to time.

Members:
Mr. Dipak Gupta
Mr. C. Jayaram
Prof. S. Mahendra Dev

The terms of reference of the Committee includes to identify, monitor and measure the risk profile of the Bank; develop policies and procedures; verify models that are used for preparing complex products; review models as development takes place in the markets and also identify new risks; monitor compliance of various risk parameters by operating departments; design stress scenarios to measure the impact of unusual market conditions and monitor variance between actual volatility of portfolio value and that predicted by risk measures; and ensure that the Bank’s credit exposure to any one group or industry does not exceed the internally set limits and that the risk is prudently diversified; and to specifically include cyber security.

Chairman:
Mr. Prakash Apte

Members:

Mr. Uday Kotak
Mr. Dipak Gupta
Mr. Gaurang Shah

To allot shares arising out of the options exercised in accordance with the terms and conditions of the various ESOP Schemes of the Bank

Members:
Mr. Uday Kotak
Mr. Dipak Gupta
Mr. C. Jayaram

To review the order passed by the Identification Committee (1st Level Committee) after considering the written representation, if any forwarded by the Borrower(s) and pass necessary orders upholding / rejecting the order passed by the Identification Committee (1st Level Committee).

Chairman:
Mr. Uday Kotak

Members:
Mr. Prakash Apte
Prof. S. Mahendra Dev

To study and advise the Bank on the future course of action to achieve dilution of promoter holding in the Bank as directed by the Reserve Bank of India.

Members:

Mr. Prakash Apte
Mr. C. Jayaram

To bring operational flexibility in processing of credit proposals and also to discharge other responsibilities prescribed in different RBI directives including periodical calendar of reviews.

Members:

Mr. Uday Kotak
Mr. Dipak Gupta
Mr. C. Jayaram