Urjit Patel quits; Vishwanathan may be named interim Governor

Mumbai: Reserve Bank Governor Urjit Patel, who faced the possibility of an unprecedented action from the government over differences on a variety of issues, Monday resigned from his job citing personal reasons.

Patel, 55, who took over as the 24th Governor of the central bank on September 5, 2016, had the shortest tenure since 1992.

He was hand-picked by the BJP-led government after his predecessor Raghuram Rajan was denied a second-term.

"On account of personal reasons, I have decided to step down from my current position effective immediately," Patel said in a brief statement.

His resignation was being speculated right from the time the government cited a never-before-used provision of the RBI Act to get him to consider its views on relaxing lending norms for segments such as small and medium enterprises, the appropriate size of reserves the central bank must maintain and the easing of norms for weak banks. In his statement, Patel thanked his colleagues at the RBI but made no mention of the government or the Finance Ministry.

"It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years. The support and hard work of RBI staff, officers and management has been the proximate driver of the bank's considerable accomplishments in recent years.

"I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future," he said.

Patel had more than eight months of the first three-year tenure left and was eligible for a second term as was given to several of his predecessors barring Rajan. Before taking over on September 6, 2016, he was a Deputy Governor overseeing the monetary policy department at the RBI under Rajan and was known as his 'inflation-warrior'.

N S Vishwanathan, senior most deputy governor, may be made the interim head of the RBI following the unexpected resignation of Urjit Patel, according to sources.

Vishwanathan was appointed as RBI Deputy Governor on July 4, 2016, for a period of three years.

If appointed interim head, Vishwanathan would head the central board meeting scheduled this Friday, the sources said.