On 12 June, the shareholders of Yes Bank Ltd at its annual general meeting passed a resolution with “overwhelming majority” reappointing its managing director and chief executive officer (CEO) Rana Kapoor, 60, for three years. Kapoor’s current term ends in August. Two other private banks larger than Yes Bank will get new CEOs between now and April 2019: ICICI Bank Ltd and Axis Bank Ltd.
Mumbai: Finally, ICICI Bank Ltd’s boss Chanda Kochhar did what she should have done earlier. On 1 June, reacting to a Mint report that the independent board members of ICICI Bank asked the bank’s managing director and chief executive officer (CEO) Kochhar to go on leave till a probe into her conduct by an independent agency is complete, the bank’s stock rose nearly 5%. The probe was announced following a whistleblower’s complaint on her alleged misconduct.
On 1 June, reacting to a Mint report that the independent directors of ICICI Bank Ltd asked managing director and chief executive officer (CEO) Chanda Kochhar to go on leave till a probe into her conduct by an independent agency is complete, the bank’s stock rose nearly 5%. The probe was announced following a whistleblower’s complaint on her alleged misconduct. After the bank denied the report and said she was on her planned annual leave, shares surrendered most of the gains.
The untold story of the creation, near-destruction and the resurgence (under a new management) of the world’s second listed microlender, SKS Microfinance Ltd, may not see the light of the day. Micro-Meltdown, written by SKS founder Vikram Akula, once the poster boy of Indian microfinance, is a gripping tale of what it takes to build a world-class financial institution and how to destroy it. However, it is only his side of the story.
Bashing our banks, particularly the government-owned ones, which roughly have 70% market share of assets, has become a favourite pastime for many. Instead of going deep into the causes of deterioration in health and the possible remedies, let’s focus on some of the vital statistics to get a sense of the state of affairs in the ₹150 trillion banking system in the world’s fastest growing large economy. In the March quarter, 19 of 21 public sector banks (PSBs) announced losses totalling ₹62,681 crore.
The Reserve Bank of India (RBI) on Wednesday raised its repo rate by a quarter percentage point to 6.25%—the first rate hike since January 2014. This was no surprise; the surprise has been that all six members of the monetary policy committee (MPC), the central bank’s rate setting body, voted for the hike.
Most economists expect two rate hikes by the Reserve Bank of India (RBI) between now and December, but there is no consensus on the time of the first hike. Will it happen on 6 June when RBI’s rate-setting body, monetary policy committee (MPC), meets or do we have to wait for the August meeting? Since Urjit Patel took over as RBI governor in September 2016, all rate decisions have been taken by a six-member MPC. For a change, I would like to believe that the 6 June policy will be a governor’s policy.