ALSO READIDFC Bank to merge with Capital First, Vaidyanathan to succeed Lall IDFC-Shriram merger unlikely by early October Shriram did not make a counter-offer on merger: IDFC Bank CEO Rajiv Lall Higher valuation in offing? IDFC-Shriram may announce new merger plan today IDFC Bank is betting on expanding its retail presence
The merger with Capital First will drive home three years of growth at one go to IDFC Bank, said the bank’s MD and CEO Rajiv Lall in an interview with Anup Roy. The succession of V Vaidyanathan in the bank is part of the strategy to drive retail growth, said Lall. Edited excerpts: Why are you stepping down as the CEO of the bank? As you know for sometime we have been looking for a head of retail to drive retailisation in the bank. This is really the best of all world, in the sense, we are getting a person who really understands retail and not only retail, has also vast experience in general banking. He has a team building and institution building experience, and here I am able to step up and act like a mentor. It works for everybody. Under the new leadership, will your vision of mass retailisation and aggressive acquisitions, continue? The mass retailisation no doubt will continue. How much more acquisitions we will do will remain to be seen, but these are things that Vaidyanathan will have to think through. For now, focus will have to be on getting the merger fully done and making sure that the transition and integration is done properly. Beyond that we are not thinking of anything at this point. How long the transition will take? We are getting different estimates. We are planning about nine months. Your shareholders will agree to this plan? Our belief is that this is a very good deal because it really adds value.
It accelerates the growth of the bank to gain at least three years. In the absence of this deal we would have depressed earnings because we would be invested in building our branch network and Casa (current and savings account) franchise. So this actually gives us again the best of both worlds. It gives us enhanced earnings and the ability to aggressively grow our Casa franchise. I believe our shareholders should welcome this.Do you think this merger is a good replacement of your original plan with Shriram? Was that a better deal had it gone through? The proof of the pudding is in the eating. So, a deal not done is not a good deal. A deal that is done is a good deal. This is a good deal. Your future plans... My future plans are related to focus on making this deal a success. There are time enough to contemplate on broader details.