- Net Interest Income of IndusInd in August 2016 was Rs 1,356 cr.
In the mid-1990s, soon after the liberalisation of the banking sector, ten banks were set up. Only five of them have survived; one of them is IndusInd Bank, the sole one not backed by an established institution. In 2008, the management of the bank was taken over by Romesh Sobti, who has overseen a dramatic improvement in its fortunes ever since.
When Sobti began, the bank’s only retail product was vehicle financing, in which it was a market leader. Sobti added several new retail products—loans against property, loans against shares, gold loans, personal loans and business loans. In the eight years that Sobti has been driving the company, the bank has increased its profit from Rs 75 crore in 2007-08 to Rs 2,286 crore in 2015-16. The results of the first quarter of the financial year 2016-17 show a loan growth at 30 per cent, with fees growing at 28 per cent, while the current account-savings account ratio is at 34.4 per cent. Profit after tax also grew strongly at 26 per cent, with net non-performing assets at 0.38 per cent.
What is Sobti’s success mantra? A clear strategy, and innovative execution. Sobti has used technology to create differentiated banking products. He calls it “responsive innovation”. This shows why IndusInd is one of the few banks that allow customers to choose the denomination while withdrawing money at ATMs. It also offers ‘cash on mobile’, enabling people to withdraw money without a debit card, by just keying in the pin sent to their phones. And its ‘quick redeem’ scheme allows credit card users to instantly redeem their points after making a purchase.
An electrical engineer by training, Sobti’s 33-year banking career has seen him work at SBI, ANZ Grindlays, and then, for about 17 years, at ABN Amro Bank. There, he rose from chief manager to executive VP, India, and head, UAE, before moving to lead IndusInd. His gentle demeanour has won the admiration of all, and his fusion of the old with the new has driven the bank’s dizzying success. The numbers are stupendous—in 2008, IndusInd Bank’s net interest income (NII) was around Rs 400 crore. In August 2016, it was at Rs 1,356 crore.