Axis Bank on Saturday announced Amitabh Chaudhary as the next Managing Director and Chief Executive Officer after receiving Reserve Bank of India’s approval for a period of three years.
Chaudhary’s term in office will commence from 1st January, 2019 and continue until 31st December 2021. Currently, he is the MD and CEO for HDFC Life Insurance Company Ltd. and will be succeeding Axis Bank’s current CEO, Shikha Sharma.
A press statement was released on Saturday which mentioned,
“Please note that a meeting of the Board will be convened in due course to inter alia, approve the appointment of Shri Amitabh Chaudhary as an additional director of the bank and as the managing director & CEO of the bank, in terms of the said RBI approval and subject to compliance with the prescribed formalities under extant law.”
About Amitabh Chaudhary:
Chaudhry, 54, holds a bachelor’s degree in Engineering from BITS Pilani and an MBA from IIM Ahmedabad. Before joining HDFC Standard Life, he was the Managing Director and CEO at Infosys BPO and also headed the independent validation and testing Unit of Infosys Technologies Ltd.. He also had short stints with Bank of America and Credit Lyonnais Securities.
“After an extensive search, my fellow directors and I are pleased to welcome Amitabh as the bank’s MD & CEO. Amitabh has a proven track record and is well-equipped to lead Axis Bank in pursuing its growth ambitions balanced with a strong emphasis on risk and compliance management,”
Axis Bank Chairman Sanjiv Misra said.
Mr. Chaudhary in his statement said,
“I would like to thank the RBI and the Axis Bank Board for the privilege and honour given to me to lead this great institution.”
An Overview of Shikha Sharma’s tenure with Axis Bank :
Shikha Sharma, 59, has been a CEO since 2000 when she served ICICI Prudential Life Insurance until 2009 and was also considered to be one of the successors to K V Kamath to head ICICI Bank.
Her stint with the Axis Bank will come to an end in December this year, after a long period of nine years (2009-2018). Over these years, she pushed growth at the bank.
Sharma had joined Axis Bank after working with her alma mater ICICI Bank. As of March 2009, the bank had advances of Rs 81,557 crore. Since then the bank’s balance sheet has grown significantly. The bank’s advances stood at Rs. 4.41 lakh crore at the end of the June 2018 quarter.
The growth, however, has come at the cost of deteriorating asset quality, which in fact is also being named as one of the reasons for her exit from the bank.
As reported by the Bloomberg Quint, the bank’s image was also hurt due to the ‘divergence’ in the quantum of bad loans reported by it and what the regulator judged bad loans to be. At the end of fiscal 2017, the bank classified loans worth Rs. 21,280 crore as bad loans. The RBI, however, pegged bad loans at Rs. 26,913 crore. The resultant divergence stood at Rs. 5,633 crore. For FY16, the bank reported an even higher divergence of Rs. 9,480 crore – 156 percent more than the reported amount. To be sure, most banks have reported such divergences.
In April 2018, the longest serving woman CEO in the financial sector announced that she would be stepping down from her role, two and a half years before her term would formally come to an end. Her announcement had come after RBI had questioned the board’s proposal to reappoint her fourth term from July 2018.