Urjit Patel steps down as RBI governor with immediate effect

New Delhi, Dec 10: Urjit Patel, has stepped down as governor of the Reserve Bank of India, with immediate effect.

In a statement, he said that he is stepping down due to personal reasons.

'On account of personal reasons, I have decided to step down from my current position effective immediately. It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years, ' a statement by Patel read.

He further said that the support and hard work of the RBI staff, officers and management has been the proximate driver of the Bank's considerable accomplishments over the 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, Patel also said.

There was speculation for sometime about Patel quitting following differences between the RBI and the government. It began when RBI deputy governor, Viral Acharya delivered a speech in which he had spoken about the need to ensure independence of the central bank.

Over the past few months several contentious issues have cropped up between the RBI and the government. The main problem was when the government demanded that the RBI shell out more dividend from its reserves.

Further, the government officials on the RBI's board pushed for the relaxation of the promotion corrective action framework being used to nurse weak banks back to health. The government and the RBI were also at loggerheads over the suggestion to set up a payment regulator outside the purview of the RBI.