Newsmaker: Arundhati Bhattacharya

An employee-friendly boss

Arundhati Bhattacharya is making headlines after becoming the first woman to take charge of State Bank of India (SBI), which controls more than 16 per cent of the banking business in the country and ranks among the top 50 banks globally. Yet, to her co-workers she is simple and unassuming - perhaps a reason why many of them never lost touch with her despite changing jobs and joining rival firms.

Bankers are often financial stereotypes, but as chief executive of SBI Capital Markets, the investment banking arm of SBI, Bhattacharya had introduced a scheme that entitled all its employees equal insurance benefits. Till then, the extent of such benefits was based on an employee's positions.

"She said 'I cannot value lives of my people differently'," says a former colleague of Bhattacharya in SBI Capital Markets. The staff cost increased significantly following the introduction of this scheme but Bhattacharya ensured that the investment bank earned enough revenues to deflect any impact on its profitability, the colleague adds.

Bhattacharya is also known for her human-resource policies that help retain women workforce better. In SBI Capital Markets, she introduced the provision of a sabbatical of up to six years for female staff on a first-come-first-served basis. She felt that women typically put their careers on the back burner after marriage or child birth, their children's secondary school examination and when elderly members in their family fall sick. The policy helped the investment bank retain many women executives, who otherwise would have quit, people familiar with the development say.

Bhattacharya has already hinted that she will adopt similar policies at SBI to keep its female workforce motivated. "Being a woman myself, I think women employees have special problems. I will definitely try to be more sensitive to that," she was quoted as saying in her maiden interaction with reporters after becoming the chairperson.

She joined SBI as a probationary officer in 1977. Before taking over the reins of SBI, Bhattacharya was the managing director and chief financial officer of the bank.

In the past three decades, she has held a number of important positions in the bank including deputy managing director and corporate development officer, chief general manager for Bangalore circle and for new businesses. Besides leading SBI Capital Markets, she also had a stint in the bank's New York office where she was in charge of monitoring branch performance, overseeing external audit and correspondent relations.

Bhattacharya is experienced in handling retail and corporate finance as well as treasury business. She is also credited with successfully setting up three of the latest subsidiaries of SBI - the general insurance arm, the custodial subsidiary and the SBI Macquarie Infrastructure Fund.

"She is one of the most employee-friendly CEOs that one will come across. She connects with everyone across levels. This is a unique skill and a necessity for running the country's largest bank," says another colleague. Bankers believe the collaborative leadership style will help her in dealing with trade unions, which have opposed several management decisions, including merger of subsidiaries, in the recent past.

Her appointment also comes at a time when the bank is struggling to maintain the pace of growth in its businesses as macro-economic environment continues to remain uncertain. SBI's net profit in the first three months of this financial year fell 13.6 per cent, return on equity declined 26.2 per cent, while return on asset narrowed by 25.7 per cent. The gross non-performing asset ratio of the bank increased to 5.56 per cent while net bad loan ratio deteriorated to 2.83 per cent at the end of June 30, 2013.

Bhattacharya, however, appears confident. She maintained that the bank was taking steps to improve its asset quality and the lender has sufficient capital to meet regulatory norms and finance business growth.