aspiration is to raise our market cap to $100 bn-plus
1996 you took over as the CEO of ICICI, a project finance institution.
Today, retail assets account for 69 per cent of ICICI Banks
loan portfolio. Do you plan to make it a total retail bank?
bank has to respond to realities. The market realities between 1996
and 2001 fairly indicated that corporate lendings were not sustainable.
Corporate India was not competitive and it was getting into deeper
trouble for a variety of reasons. Among other things, the cost structure
was not right and the interest rate was too high. We had to look
for alternatives to derisk our portfolio. We decided to get into
retail and it was a right call. Post 2002, we see a resurgent corporate
India and today there is an opportunity to work with corporate India.
needs are very different today. The corporations are leveraging
themselves appropriately and accessing markets both debt
and equity appropriately. As a bank we need to respond to
India is buying assets abroad and raising money globally. We are
partnering them. Corporate India is also very active in seeking
risk management products. It has spent about $8 billion in acquisitions
but the domestic investment pipeline is worth $200 billion. So,
acquisition financing is an opportunity but the bigger opportunity
is funding domestic requirement.
will you rebalance the portfolio and bring down retail assets?
is no theoretical balance. You need to look at emerging opportunities.
The India growth story will continue for long. There are opportunities
in corporate India, consumers, the overseas play as well as rural
you sustain the growth?
bank always has to work within constraints of risks. We must be
aware of the inherent risk in our business. Growing too fast is
also a risk. ICICI Bank is growing what we believe within the limits
of manageable growth. When the industry is growing at around 20
per cent, a bank which is well positioned to seize the market opportunities
can grow at 30 per cent.
do you see ICICI Bank in 2010?
look at the Chinese banks as the benchmark. A Chinese bank got recently
listed at a market cap of $110 billion. Our aspiration is to look
for this kind of market cap. We have to raise our aspiration level
from $15-20 billion to over $100 billion and strike a balance somewhere
in between. This a statement and to support this we need to put
in a lot of hard work.
plan for launching new businesses?
are in every area of financial services. Insurance is a particular
growth area for us. I would expect a lot of opportunities in insurance
to create value for our stake holders.
constraint for growth?
typical constraint for any entity is capital in its various forms
financial capital, human capital and technology capital.
Then, of course, one needs to put in the right building blocks and
seize the opportunities. Financial capital was an issue and we had
to go for overseas listing to raise money but today financial capital
is no longer a constraint. Similarly, human capital is no longer
an issue as we have a pool of skilled people well versed with risk
mitigation, treasury business and so on.
have the demographic advantage of a young India and that is providing
us with a talented work force. Ten years back, to run an ATM we
needed three levels of redundancy a leased line, a dial-up
line and a V-Sat to make sure that the ATM performs. We are able
to keep our technology architecture very cost effective and we are
better placed than even the global players. Our own assessment is
that big structural changes are taking place at the market place
and we are on a growth paradigm which will last 15 to 20 years.
There are risks but we must understand them and address them.
did you get involved in the IPO scam?
have explained our stance to the regulator and beyond that I dont
want to talk on this.
market has always had the perception that ICICI Banks balance
sheet is fragile and youre hiding NPAs.
perception probably lasted longer than reality because people wished
it that way. Let me be frank about it. People could not understand
how we would get the market share. Historically, indeed there was
a challenge in the balance sheet because of the structural changes
that corporate India had undergone in the late 1990s. But nobody
was willing to acknowledge that we were addressing it upfront by
raising capital, introducing new products, derisking ourselves and
making sure that all these initiatives did not have any dire impact
on our balance sheet. Nobody wanted to acknowledge that this could
work. Again, when we were able to execute what we wanted to do on
the consumer credit front and started getting the market share,
there were issues like it was an untested strategy and it would
never work. Looking back, it was a wishful thinking of some people.
Today only a very brave person will say that our balance sheet is
have been at the helm for over a decade now and you do not have
any retirement age. Does this indicate your inability to groom a
not. Look at ICICI Banks bench strength at various levels.
We have one of the strongest benches across the world in the financial
services business. We have leaders in the age group of 35-45. They
are holding board positions at various group companies. Each of
them has proved by being market leader in the business s/he drives.
I salute this young team.
why did you stay put after completing two terms?
be the board felt that we need continuity for some more time. We
are a young organisation. ICICI is 50 years old but in our new avatar
we are effectively less than four years old. I leave to the board
to decide on the right time for my retirement.
will succeed you?
have a team and from the team the successor will emerge.
the turning point in your career? Converting ICICI into a bank?
the point of view of all stake holders, the defining moment was
when we derisked ourselves by converting into a bank. That made
sure that we could run profitably. Had that not happened, we would
have faced very serious challenges.
you a man of action or a man of vision?
and charisma alone do not work. Ultimately you must have a bias
for action. At the same time you cant be part of every single
bit of action. It wont work. A leader must have a great degree
of vision, organising ability and confidence to delegate and a little
bit of charisma. I have a little bit of all these things.
you lack any particular quality?
a long pause) I am probably too technical a person. By training
I am an engineer and also did my MBA but I never have an exposure
to liberal arts. I wonder sometime that if I had exposure to liberal
arts, probably I could have been a better person, better leader
and achieved a little more than what I have (done). Early in my
career I used to feel that technical education is the best education
but after 35 years of working I like to admit that I stand corrected.
us about your life beyond banking
am a very simple person. I make my own cup of tea. Most of the time
when my wife and kids are away I actually go home to a flat which
is locked. We dont have full time domestic help. I open the
door myself, switch on the lights, heat my food and eat alone. I
follow cricket and tennis. For more than 20 years watching motor
racing has been a hobby. I enjoy any programme on TV which is technically
well produced.I enjoy anything that epitomises quality.
you watch Hindi films?
watch Hindi films for laugh. I dont want to sit through an
agony. The last Hindi film I saw was Bluff Master.
Malt. Once in a while.
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