All hands on the deck, Captain!

Shahrukh khan to Host IIPM 4Ps Annual Business and Marketing Quiz

Great ads, greater roll-out plans, greatest financials... but ‘talent-crunch’ might just play the spoilsport!

Advertising, branding, positioning, geographical outreach... and any other progressive act that you could possibly cook up, were ‘once’ considered just the forte of private sector banks and their foreign counterparts. Not any more! The public sector banks (PSBs) have shed their conservativeness, for good and are tired of being branded as laggards. Today, their approach towards broader outreach, customer acquisition & education and product offerings is anything but the mark of a self-satisfied, complacent public banker. IDBI Bank is one such name, which has opted for an overdrive as far as re-positioning and re-branding are concerned. The project finance institution turned bank, is leading the race and is aptly recasting its business model, strengthening itself through organic growth strategies and basking in the sun of glorified financials!

Its newest taglines: “Not just for the big boys” and “Aao sochein bada” also project the inherent strength of the bank, which, for the first time in a decade, has hit a positive home-run – a positive net interest margin and the highest annual growth in terms of deposits and lendings (30%) amongst all banks in the country. And today, the bank is not just making money for its stakeholders but also working towards ensuring ‘some’ tomorrow for industries across the board. Picture this: IDBI Bank Ltd. is leading a group of lenders to arrange $1 billion debt for Air India (after the airline failed to raise funds from European banks to buy Airbus SAS aircrafts); some reverse osmosis at a time when the biggest of names in the vertical are running around with bailout bowls in their hands (and 9 more for bailout nos.2 to 10). The bank is aggressively pursing the dream of becoming the 5th largest bank by 2011-12, from being the current 8th. This would also help improve its low cost current account savings account (CASA) ratio, which is pegged at 15.22% of the total deposits to somewhere close to 40% (which is the standard for other public sector banks).

So there’s some dream, and happily complemented by ambitious financials. Digest this – it is targeting a growth of more than 100% in its business to touch Rs.3.35 trillion by FY2011 as compared to FY2008. Considering that market reports suggest an estimation of Rs.2.1 trillion by the end of the current fiscal, another good year will just see it get there! So there’s it – great dreams, super numbers and big hopes... but not sans challenges! And what’s the catch? Having obtained the much needed licence from RBI to add 200 branches (at present it has 508 branches and 880 ATMs) by March 2009, its expansion plan had to be ‘carried forward’ for lack of managerial staff. Given the fact that IDBI expects its branch network to grow by 40% (which will indeed enable the desired business growth), ‘talent - crunch’ may just play the spoilsport.

For now though, IDBI is staying away from inorganic diet; having achieved much success in the change process, as Yogesh Agarwal, CMD, IDBI Bank happily quotes, “The bank has indeed come a long way from being a pure development financial institution and is currently transforming into a new generation, full-service commercial bank...” Better safe than dead! But considering that its internal growth plans are paying well, there’s no need to be swept away by the M&A wave... Silent waters run deep... But wait! Is IDBI playing the ship, or is’t the ocean itself? Whatever its intentions, it needs all hands on deck – manpower! [And that one was for you, Captain Yogesh!]

Gyanendra Kr. Kashyap

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM 4Ps Quiz
2300 IIPM students get jobs
The Most Revolutionary Concept In Education PLANMAN CHE CENTRE FOR HIGHER EDUCATION, Supported by IIPM India’s Leading B-School
Detail of all IIPM branches
IIPM set to beat economic slowdown
IIPM Admission Detail
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM - Admission Procedure
IIPM, GURGAON