FIVE YEARS AGO, when R. Subramaniakumar landed at Chennai-based Indian Overseas Bank (IOB), the public sector lender was fighting multiple battles: deteriorating asset quality; over-dependence on bulk deposits with a concentration of risky corporate loans; and low employee morale. But he was unfazed. In his short stint as MD & CEO, he streamlined the HR function, re-built the risk management team, corrected and created some 85 policies, kicked off a clean-up of the books, and focussed on building a diversified business model. Subramaniakumar retired from IOB in June 2019 and the mid-sized lender has started reaping the benefits now. That’s not the only feather in his cap. Earlier, he was instrumental in laying the groundwork for public sector lender Indian Bank’s retail-, agri- and MSME expansion. More recently, Subramaniakumar was the administrator of the beleaguered Dewan Housing Finance Corporation Ltd (DHFL), which was sold to the Piramal Group. The veteran public sector banker has moved on to his next demanding role—as the MD & CEO of private sector lender RBL Bank. “I’m capable of fitting myself into the role assigned to me. The bank is good and doing well. I should take it to the top,” the 63-year-old says.
Analysts, however, are not gushing over the Reserve Bank of India’s (RBI) choice to head RBL. They point to earlier instances of former public sector bankers being appointed heads of financial institutions that have a track record of poor asset quality and corporate governance issues. For instance, the entry of former RBI Deputy Governor R. Gandhi on YES Bank’s board unearthed more non-performing assets (NPA) on its books. Similarly, a year after the RBI appointed its nominee on the board of Lakshmi Vilas Bank, the private sector lender was superseded by the regulator. “Hence, this new development raises many questions,” says Jitendra Upadhyay, Se-nior Research Analyst at brokerage firm
