ICICI Bank Ltd., India’s largest private sector by assets, is getting ready to roll out a variety of financial products for villagers and farmers in rural India, said managing director and chief executive, Chanda Kochhar. From basic bank accounts to subsidy transfers to basic insurance for farm produce, the bank expects to offer these products in the next six months, she said in a recent conversation with India Real Time. The bank currently offers a basic bank account—known as a no-frills account—in 18 states and has three million such account holders. These provide it with a ready market in which to sell some of these new products. The concept of a no-frills account was first suggested by the Reserve Bank of India in 2005, when it directed all banks to offer this option of a basic account to villagers. Most banks did the bare minimum on that—even today less than half of all Indians have a bank account. Last year, the RBI asked all banks to submit a plan for the inclusion of more Indians into the formal financial system that was approved by their boards. This, said RBI governor D. Subbarao, in a speech at the spring meeting of the International Institute of Finance in New Delhi earlier this week, would create a sense of ownership of the problem among banks. ICICI, which is listed in New York, says it is readying this rural push ahead of others. “Over a period of time all banks will have to look at rural business,” said Mrs. Kochhar. “We are looking at a mix of channels to reach out to farmers including basic accounts, transfer of subsidies, some lending.” Early this year the bank announced a tie-up with Vodafone Essar to eventually offer financial products in villages by mobile phone. ICICI, which had aggressively targeted retail customers during most of the past decade, cut that business back during the recession after it saw a huge number of bad loans in its portfolio of unsecured, personal and credit card loans. For the past two years, its retail loan portfolio has been rising more slowly than at other banks, but in an earnings call last month, Mrs. Kochhar, said the bank would keep pace with the industry in the fiscal year starting in April.
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Monday, March 7, 2011
In India, women bankers have broken glass ceiling (March 8 is International Women's Day)
New Delhi, March 6 (IANS) As the world celebrates Women's Day Tuesday, a striking facet in the otherwise male-dominated corporate world in India has been the representation of women in the top echelons of banking and financial services. Consider this: The country's second largest commercial lending institution, ICICI Bank, is headed by a woman, Chanda Kochhar; so is the case with the third largest in the private sector, Axis Bank, which has Shikha Sharma on the top seat. One of the largest foreign banks in the country, HSBC, and the Indian arm of the global financial powerhouse JPMorgan Chase are also headed by women, with Naina Lal Kidwai and Kalpana Morparia respectively overseeing their operations. Even the Reserve Bank of India, until recently, had two women among four of its deputy governors in Usha Thorat, who has retired, and Shyamala Gopinath, who is still serving the apex industry institution. 'Women have this thing with numbers, finance and money. The banking industry gave them equal opportunities and they have excelled,' Finance Secretary Sushma Nath, who is herself the first woman to occupy the top post in North Block, told IANS. In fact, a look at the composition of the top brass of 11 top listed banks on the Indian stock markets reveals that nine of them have at least one woman on their boards and two of them have women serving as chief executives. This is backed by a recent study of 240 top Indian companies by EMA Partners, the global executive-search firm, which says more than a half of India's women chief executives are accounted for by the banking and financial services industry. 'The banking and financial services industry has seen the presence of more women on top than any other industry. In fact, women chief executives among the private sector and foreign banks would almost outnumber men in this sector,' the study said. According to Alok Khare, president of the All India Bank Officers Association, out of about one million bank employees in the country, 15-17 percent are women. 'But in metro centres and cities, 27-30 percent are women,' Khare told IANS. What are the reasons for this pleasant exception to the male bastion that the corporate world is? 'Some of the operational challenges in terms of gender aren't there in our banking and financial services industry,' said Aruna Sundararajan, who was till recently the chief executive for digital inclusion at Infrastructure Leasing and Financial Services Ltd. 'This industry also does not need the kind of networking that is otherwise required in the corporate sector. It has also provided equal, merit-based opportunities to women,' Sundararajan, now a joint secretary in the urban development ministry, told IANS. Experts say the answer to this also dates back to 50 years when then prime minister Indira Gandhi nationalised 14 top banks in the country, followed by seven more in 1980, and made them adopt a common process of recruitment through competitive tests. Besides, the working hours of banks were suited to serve the woman's domestic schedules, there was physical proximity to the place of work, the job offered an element of respectability and the profession did not require physical labour. The result: Banking became a vocation of choice for career-minded women.
JK Bank CEO seeks pay hike to Rs 1 million per month
Srinagar: Jammu and Kashmir Bank’s, recently appointed Chairman and Chief Executive Officer (CEO), Mushtaq Ahmad, is seeking a pay hike from current monthly compensation of about Rs 3.5 lakh to Rs 10 lakhs, apart from the sops and perks he is enjoying, reliable sources in the Bank told Kashmir Dispatch on Sunday. The top officials of the Bank have kept a Board meeting for revision of compensation to the CEO and two Executive Director’s (ED) on Monday, February 28 to decide on the pay hike. Sources said the both ED’s who will be retiring from their services in May and June this year are seeking a revision of their salary up to Rs 3.5 lakh per month. “The date for such a crucial meeting has been deliberately fixed, looking at the preoccupation of the state government officials with the budget 2011 preparations,” the source said. Adding, “Otherwise the same could be deferred till all the concerned officials from the state government get free from the state budget 2011.” According to the sources, there was a tussle going on between the ED’s of J&K Bank and its CEO over the compensation amount. However, it seems that both the parties have mutually agreed to double their montly compensation, the source said. “This will have a long run financial implications on the over all development of the institution. The Bank will have to pay them accordingly after their retirement,” sources mentioned. Apart from the monthly compensation, the Bank bears all the expenses of the Chairman/CEO, the source said. Adding, “If the CEO gets a hike, the Bank has to spend around 17-18 lakh a month on him.” Earlier, CEO, J&K Bank Dr. Haseeb Drabu was initially paid Rs 1.5 lakh per month and then the same was raised to about Rs 3.5 lakhs, in a similar kind of board meeting. The Reserve Bank of India (RBI) cleared the appointment of Mushtaq Ahmad as the new Chairman and CEO of Jammu and Kashmir Bank in October 2010 after Drabu was asked to resign by the state government from the Chairmanship of the Bank. The Bank was incorporated in the 1938 and is the largest bank private sector Bank in the state of Jammu & Kashmir. The state government is the major stake holder in the Bank and acted as the the sole banker and lender to the government of J&K. The source said, there is an increased interference in the official matters of the Bank from politicians of a particular political party. The Bank’s Executive President (EP) Ajit Singh who was retiring in April this year has been given a one year extension in his service due to intense lobbying by a senior political leader, the source told Kashmir Dispatch. Jammu and Kashmir government’s, Commissioner Secretary Finance, Sudhanshu Pandey might not attend the compensation meeting, the source revealed.
Two youth held for ATM theft
New Delhi, March 6 – The Delhi Police arrested two youth, including an MBA student, for allegedly withdrawing Rs.90,000 and purchasing valuables using a stolen ATM card belonging to a senior Reserve Bank official, police said Sunday. Police said the two could use the card easily because the pin number was written behind it. According to Vivek Kishore, deputy commissioner of police, Rahul Sharma (24), an MBA student, and Malkeet Singh (25) were arrested from their homes in Noida and Ghaziabad Saturday. The two were held on a complaint by Daulat Ram Pawar, General Manager of Reserve Bank of India, who lost his bag containing the ATM card and mobile phone in Karol Bagh Feb 23. It was noticed that Rs.90,000 was withdrawn from his account and Rs.35,304 worth of valuables bought through his debit card. The closed circuit TV footing at the ATM counter helped the police to nab the two men. They told police that they found the bag from Karol Bagh.
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