Mahesh Jain is IDBI Bank's new CEO

Jain's focus areas: Retail loans, bad assets resolution

Protection of the bottom line, focus on retail lending and resolution of bad assets will be the key priorities of the new managing director and chief executive officer of IDBI Bank, Mahesh Kumar Jain.

Soon after taking charge on Monday, Jain went into a huddle with top managers to review conditions at the bank. Later, addressing employees, he sought their cooperation to ride successfully out of the present trying times. 

He told employees during a brief interaction that the fruits of collective efforts will go to them, while he will take responsibility for any setback.

The government has transferred K Kharat, erstwhile managing director and chief executive of IDBI Bank, to Chennai-based Indian Bank, which Jain headed till the end of March.

The emphasis will be on extending loans that attract lower risk weights, thus helping to conserve capital. Growing secure retail loan book, with low default probability, would be one strategy to expand capital light business.

IDBI Bank’s retail book stood at Rs 59,187 crore at the end of December 2016, out of total advances of Rs 2,32,552 crore. The retail book was Rs 52,448 crore in December 2015, out of total loans of Rs 2,19,393 crore. 

Maximum efforts should be put on the resolution and recovery from stressed assets, he said in a short address to employees. 

The bank booked net loss of Rs 1,958 crore in April-December 2016. The losses were Rs 3,665 crore in 2015-16.

There has been no internal accrual in 2015-16 to strengthen capital base. This year (2016-17) is also expected to end up in losses.

Its capital adequacy ratio (CAR) was 11.29 per cent at the end of December 2016, with common equity tier I of 7.24 per cent.