Shikha Sharma takes charge at Axis Bank

Shikha Sharma today took charge as the Managing Director and Chief Executive Officer (MD & CEO) of India’s third-largest private sector lender Axis Bank. Earlier in the day, her nomination was approved by shareholders at the bank’s annual general meeting in Ahmedabad.

Formerly, she was the founder MD & CEO of ICICI Prudential Life Insurance Company.

Apart from this new responsibility, Sharma has also been appointed as additional director on the Axis Bank’s board of directors.

R H Patil, Chairman of the bank’s Nominations Committee, said: “We are delighted to have Sharma join Axis Bank as the MD & CEO... She brings with her considerable knowledge of the corporate and financial sectors, which will benefit the bank. The board is confident that under her leadership, the bank will achieve even greater heights.”

Sharma, who has done her MA and post-graduate diploma in software technology from the Indian Institute of Management, Ahmedabad, joined the erstwhile ICICI in 1980 and served in various capacities across the group. She was instrumental in setting up I-Sec, a joint venture between ICICI and JP Morgan, and ICICI’s personal financial services that included retail deposit taking, retail credit, credit cards and web trade. She was said to have been in the running for the position of MD & CEO of ICICI Bank at the end of K V Kamath’s tenure.

“I am honoured that the board has entrusted me with the responsibility of leading Axis Bank and am delighted at the opportunity. Dr Nayak has left behind a bank, which is a very well respected, with a strong lineage and an exciting future.”

Prior to her appointment, Axis Bank had been without an MD since April 20, 2009, when P J Nayak, who also served as the bank’s Chairman, resigned from both positions at the end of the lender’s results board meeting. The board had voted 8-1 in favour of Shikha Sharma as the new MD & CEO, the only dissenting vote being Nayak’s.

The civil servant-turned banker, Nayak had made it clear that he was strongly in favour of an internal candidate replacing him. Following his resignation, M M Agarwal, the senior-most executive director in-charge of corporate banking and a contender for the post of CEO, also expressed his desire to quit but was persuaded by his colleagues to continue.

A committee headed by Agarwal, which included other executive directors Hemant Kaul, V K Ramani and S K Chakrabati, was responsible for the day-to-day operations of the bank in the absence of an MD.

The position of Chairman, to be nominated by the Specified Undertaking of the Unit Trust of India (SUUTI), which owns a 27 per cent stake in the bank as on March 31, 2009, remains vacant.

Bank to raise Rs 3,000 crore capital
As part of its asset acquisition plans, private sector lender Axis Bank plans to raise Rs 3,000 crore debt capital in the current financial year.

In a communication to the stock exchanges after its annual general meeting in Ahmedabad today, the bank said it planned to raise Rs 500 crore Tier I capital and Rs 2,500 crore of Tier II capital in 2009-10.

The bank’s capital adequacy ratio (CAR), or a lender’s capital as a proportion of its total risk-weighted assets, stood at 13.69 per cent at the end of the March quarter.

MM Agarwal, executive director in charge of corporate banking, said, “Even at present levels, our capital adequacy ratio is fairly strong. We are further increasing our capital base because we feel the economic situation is improving and we might look at acquiring assets on the loans front as well as investments front.”

He added that the fresh capital would take the bank’s CAR to roughly 15 per cent.