/* WATCH THIS SPACE FOR MORE TOUGH QUESTION ONCE FY2013-14 RESULTS ARE PUBLISHED */
Q 1. Indusind bank has one of the most expensive ERP(Finnacle - an Infosys product). Also it is a open secret that the opportunities and margins lie in the retail side of the business. Why then is Indusind bank missing the wood for the trees and letting banks like Kotak Mahindra bank, Yes bank and others steal the show(by offering higher interested rated and better features to savings bank accounts?)
Q 2. When retail banking the largest thrust area of Indusind bank, how can you afford such lapses and risk being perceived as inefficient? Doesn’t perception matter more than the financial numbers in your line of business?
Q 3 Do you maintain a database of nepotism(perhaps unavoidable for you) in recruitment? What is the percentage of nepotism in Indusind bank? With automation in services, jobs have become the most scarce commodity? Why not make your filters sharper?
Q 4. While disbursing loans and jobs, why is Indusind bank too secretive. Do you have husband and wife working for you? If yes, how many? What about relatives?
Q 5. Why should anyone infer a bank belonging to the Hinduja group to be anything else besides crony capitalistic, more so when their track record on fair business practices leaves a a lot to be desired?
_ FYI_
Mr. Romesh Sobti has joined the bank as Managing Director & CEO, taking charge from Mr. Bhaskar Ghose. Mr. R. Seshasayee, a Chartered Accountant by profession is the current Chairman. The other members on the board are Dr. T. T. Ram Mohan, Mr. Ajay Hinduja, Mr. S. C. Tripathi, Mr. Ashok Kini, Mrs. Kanchan Chitale, Mr. Vijay Vaid, Mr. R. S. Sharma and Mr. Y. M. Kale.
Q 6. SBI has tied up with CMS for deploying automatic cash collection machines that would update customer accounts in real time? Why is Indusind Bank not taking the lead in such initiatives?
Q7. While CASA ratios have improved for Indusind Bank, as on December 2013, Indusind banks is lagging behind market leaders like ICICI, HDFC and Axis Bank by a huge margin, it is not anywhere close to it’s peers like Yes Bank and Kotak Mahindara Bank, either. Is it not high time that we see some head begin to roll. Can we afford to be anymore complacent?
Source: https://business-standard.com/article/finance/private-banks-pip-psbs-in-casa-mobilisation-114031800486_1.html
Q8. While Indusind bank employs 12, 000 employees, both Yes bank and Kotak Mahindra bank are able to deliver better productivity, employee-sales ratio? Isn’t Indusind bank taking it’s shareholders for granted? I’m concerned about your employee productivity and employee sales ratio which are interior both to Yes bank and Kotak Mahindra bank. By the way your employee branch ratio is a misnomer.
When personal relations, family businesses and vested interest is one of the key driving forces behind a bank’s loan book(leading ultimately to bump-ups in the stocks price) the situation is far from hunky-dory. Why don’t you folks play on the strength of your product? Of-course, no one can compete with State Bank of India on interest rates, However, why not be a competitive player in the private banking space instead of relying on personal relationships? Personal relationships may have involve grey and dark areas that can hurt in the long run. While I do not know exactly how is going for Indusind bank surely, you need to push harder to create your niche. Although erstwhile Western union bank was not making healthy profits like you, it relied too much on personal relationships. If you cannot manage as much, it’s better to spread your wings aggressively in overseas market.
Unfortunately we do not see a churning of banks like in United States
Source: https://fdic.gov/bank/individual/failed/banklist.html
- I however belong to the camp that feels, dead wood needs to replaced or removed and we need more competition in the banking sector(at least private banking space). Banks such as yours have a great opportunity to exploit the situation positively to be seen as a competitive player in the private banking space.
NOTES:
1. Looming on the horizon are new mediators. In credit, we have shadow banking(NBFCs), crowd funding, peer-to-peer lending. Drawing an analogy from the organic world with the marvels of evolutionary success, what could be the genetic make-up of a good bank, which preempts inbreeding(doing business with known parties), allows co-creation, (new business models, better risk practices and larger participation in financial inclusion) and encourages mutation(disruptive thinking) from time to time?
2. In evolutionary terms, the local banking sector has moved from the Paleozoic era(pre-nationalisation era) to Mesozoic(post-nationalisation) to present Cenozoic era(Post-1991). Drawing upon Darwin’s theory of "survival of the fittest" many local banks need to introspect. Yet such is the impact of banks on the larger ecosystem, rarely are they allowed to shrivel or even wither away. With so much weighing on them, it becomes expedient that banks have to do a balancing act between its strategic intent and alignment with national economic objectives. All this can originate from a robust "genetic structure" based on the strands of DNA that combine together.