OLD SBI HAND FACES NEW CHAL­LENGES AMID PAN­DEMIC

on busi­ness-stan­dard.com ‘WE CAN QUICKLY REACH PRE-COVID LEVEL’

Business Standard - - FRONT PAGE - RA­JNISH KU­MAR For­mer chair­man, SBI

Keep­ing the bank’s op­er­a­tions up and run­ning in the last six months has been the most chal­leng­ing pe­riod for RA­JNISH KU­MAR, who re­tired as chair­man of SBI, in his 40-year ca­reer. The fi­nan­cial sys­tem in In­dia has man­aged the sit­u­a­tion well but needs fix­ing, Ku­mar tells Ab­hi­jit Lele. Edited ex­cerpts:

Af­ter the pan­demic struck, life has been chal­leng­ing for peo­ple and banks. What are your thoughts about the last six months?

First thought is about keep­ing op­er­a­tions up and run­ning in a chal­leng­ing time like this when per­sonal safety and se­cu­rity be­come very im­por­tant. We have been able to do it. The morale of the staff and courage shown by those work­ing in SBI have not been al­lowed to go down. The com­mu­ni­ca­tion and steps taken for em­ploy­ees’ per­sonal safety and hy­giene played a very crit­i­cal role. In th­ese times, emo­tional con­nect with staff mat­ters a lot. That is what we have been able to do suc­cess­fully.

With a ca­reer span­ning over 40 years in SBI, how would you de­scribe this phase of your life?

Th­ese six months have been the most chal­leng­ing part of my ca­reer. The rest were fi­nan­cial chal­lenges but this was very dif­fer­ent. This was true for ev­ery or­gan­i­sa­tion across the globe. We have been able to ne­go­ti­ate with the sit­u­a­tion ef­fec­tively.

Banks and the fi­nan­cial sys­tem man­aged the pan­demic chal­lenge quite well. Is the time ripe to have con­crete plans to get the econ­omy back on track as it will also make life easy for banks?

I be­lieve that the Re­serve Bank of In­dia (RBI) and the gov­ern­ment of In­dia have done a lot. The gov­ern­ment has al­ready given di­rect as­sis­tance (money) to those in need. On the mon­e­tary front, things have been man­aged ef­fec­tively. Some peo­ple say there can be more fis­cal sup­port. It has costs. Even if the gov­ern­ment puts more money in bank ac­counts, peo­ple are not spend­ing. You have to also keep in mind that bank de­posits also rose be­cause money that came into ac­counts was not spent fully.

When would we be back to the level be­fore the pan­demic so far as bank­ing and the econ­omy are con­cerned?

A lot of re­cov­ery has al­ready hap­pened. Cur­rently, I am not see­ing too much stress on the bank’s books. That is the sit­u­a­tion with SBI. With some de­gree of vari­a­tion, that would be the po­si­tion for other banks also. This quar­ter, the re­cov­ery has been higher. That

means the po­si­tion seems to be bet­ter. So, I hope we con­tinue on this track. And if we con­tinue like this, then I think we can quickly come back to pre-covid lev­els.

This pe­riod also comes with ex­treme stress, rais­ing risks of de­faults. Would we see the bad non-per­form­ing as­set (NPA) lev­els like 2017 and 2018?

No way. There was lot of ac­cu­mu­la­tion at that point of time (2017 and 2018). There is no ac­cu­mu­la­tion now.

Be­sides the pan­demic, the YES Bank saga also tested your grit. Was the op­tion to merge fea­si­ble?

The op­tion of merger was not at all fea­si­ble. That would have been a big mess. Merg­ing a bank­ing en­tity of YES Bank’s size would not have been an is­sue for SBI. But cul­tur­ally we are poles apart. Cul­tural in­te­gra­tion would have been al­most im­pos­si­ble.

There is dis­cus­sion about fur­ther re­forms in the fi­nan­cial and bank­ing sec­tor. Which as­pects should get pri­or­ity?

“MERGER OF YES BANK WITH SBI WAS IM­POS­SI­BLE. CUL­TUR­ALLY, WE ARE POLES APART”

“WE HAVE TO FIX THE FI­NAN­CIAL SYS­TEM. WITH­OUT RO­BUST PSBS THE FI­NAN­CIAL SYS­TEM CAN­NOT BE STRONG”

We have to fix the fi­nan­cial sys­tem, def­i­nitely. Un­less, pub­lic sec­tor banks – which have 60 per cent share in the bank­ing busi­ness – are strong, the fi­nan­cial sys­tem can­not be strong. As for pri­or­ity, the issues are about cor­po­rate gov­er­nance and re­cruit­ment poli­cies in banks. The struc­ture is very rigid but to­day you have to be very flex­i­ble. We need that flex­i­bil­ity. It is high time that they (banks) stand on their own and the gov­ern­ment con­tin­ues to stay in­vested. But there should be free­dom, par­tic­u­larly in hu­man re­sourcere­lated issues.

Post re­tire­ment, how are you go­ing to keep your­self en­gaged?

Will keep my­self phys­i­cally fit and do things that keep me men­tally fit.

What are the many things you wanted to do but gave lit­tle at­ten­tion and now would like to de­vote time to? Where will you set­tle?

For the last three years, I did not get a chance to take even one-day leave. So, I would re­lax for the first two months and then think about the days ahead. I am set­tling in Delhi as all my rel­a­tives are in and around the cap­i­tal city.

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