Private sector lender IndusInd Bank said on Thursday that it had appointed Sumant Kathpalia (pictured) the next managing director (MD) and chief executive officer (CEO) from March 24, for a three-year term.
Kathpalia will succeed current MD & CEO Romesh Sobti, who has been at the helm of affairs for over a decade now. Sobti’s term as MD & CEO will end on March 23.
The bank’s nomination and remuneration committee and the board had considered and submitted Kathpalia’s name as a potential candidate for the role of MD & CEO to the Reserve Bank of India (RBI), seeking an approval.
“The bank has received a communication from the RBI on Thursday, approving the appointment of Kathpalia,” the lender said.
At present, Kathpalia is heading the bank’s consumer banking business and is based out of Delhi. Kathpalia used to head the consumer loans vertical at ABN Amro Bank, and had joined IndusInd Bank with Sobti and others in 2008.
Kathpalia is a qualified chartered accountant, and has over 20 years of experience in banking, having worked with foreign banks such as Citibank and Bank of America. He has a vast experience in consumer banking, project management, credit cards, bancassurance, wealth management, and consumer finance.
Kathpalia is credited with building the bank’s consumer loans portfolio from scratch, as part of a strategy to diversify the loan book adopted by the bank. He takes over the reins of the bank at a time when the private lender’s stock has been struggling due to concerns over its telecom exposure despite the bank clarifying on it.
On Thursday, the bank’s stock slipped as much as 3 per cent intra-day, before ending the session down 1.71 per cent at Rs 1,115.60.
With the Infrastructure Leasing & Financial Services and housing finance companies-related bad loan pressures hitting the bank, its gross non-performing assets (NPA) ratio touched a multi-quarter high of 2.2 per cent in the December quarter (Q3). In the past two months, IndusInd Bank has plunged 28 per cent on account of the risk of further asset quality deterioration. In comparison, the S&P BSE Sensex has gained 5 per cent during the same period.
On February 11, Moody’s Investors Service had revised the outlook on IndusInd Bank’s ratings to ‘negative’ from ‘stable’, while affirming its ratings, to account for the risk of further asset quality deterioration.