RBI nod to Yes Bank AoA change on nominee directors
Why in the news
After SMBC of Japan bought a stake in Yes Bank, the RBI allowed the bank to amend its AoA regarding nominee director appointments.
About the Articles of Association
- A legal document laying down a company’s internal rules and management structure.
- Governs ties among the company, its shareholders and directors.
- Required by the Companies Act, 2013; complements the Memorandum of Association (MoA), which sets objectives and scope of operations.
| Area | What AoA covers |
|---|---|
| Governance | How the firm is run; directors’ powers and duties |
| Shareholders | Rights, privileges, obligations; voting and dividends |
| Operations | Share issue, meetings, borrowing powers, appointing or removing directors |
| Investor deals | Nominee director rules arising from investor agreements, as with SMBC |
Exam angle
- AoA = internal rules; MoA = objectives and scope.
- Legal basis: Companies Act, 2013.