Shikha Sharma’s years at Axis

Shikha Sharma, an ICICI Bank veteran, had joined Axis Bank in June 2009. While her strategy to acquire Enam’s investment banking business for ~20.67 billion and expand the bank’s retail base worked well, the lender’s loans to the infrastructure sector have resulted in high non-performing assets.

Shikha Sharma, a veteran at ICICI Bank, joined Axis Bank in June 2009. She has spearheaded the bank’s journey to become a universal one.

While her strategy to acquire Enam’s investment banking business for ~20.67 billion and expand the bank’s retail base worked very well, loans to the infrastructure sector players resulted in high non-performing assets.

Between 2008-09 and 2016-17, Axis Bank’s net interest income and other income, mainly from fees, grew five-fold and four-fold, respectively. Prior to Axis Bank, Sharma was the managing director (MD) and chief executive officer (CEO) of ICICI Prudential Life Insurance. When she joined, the gross nonperforming asset (GNPA) of the bank was at 1.01 per cent of total advances, but by December 2017, the GNPA rose to 5.28 per cent. The Reserve Bank of India found divergence in NPA reporting to the tune of ~48.67 billion in 2016-17 and ~94.78 billion for 2015-16.

As a result of the pressure of bad debts, net profit at the end of December was at ~7.26 billion, against ~5.62 billion when she became the MD of the bank.

In July 2017, Sharma was recommended for a three-year reappointment by the bank’s board effective from July this.

But, now the RBI has reportedly asked the board to reconsider the appointment. Sharma would be 60 in November 2018, and complete 10 years as the bank’s CEO the following year in June.

Considering Sharma was a lateral entry, hired from ICICI Bank, and had not grown organically in the bank, such as Aditya Puri in HDFC Bank, the RBI might want to ensure the bank has other options as well.