Jagdishan to helm HDFC Bank
Sashidhar Jagdishan has been named the successor to Aditya Puri at HDFC Bank.
Jagdishan, 55, will take charge on October 27 — a day after Puri retires as the managing director and chief executive officer after more than 25 years with the bank.
Puri had built HDFC Bank from scratch — he had joined in September 1994 — and turned it into a powerhouse with assets of over Rs 10 lakh crore and the tag of the most valued lender in the country.
HDFC Bank on Tuesday informed the stock exchanges that the Reserve Bank of India (RBI) on Monday had approved the appointment of Jagdishan as its managing director and CEO for a period of three years from the date of taking charge on October 27 under Section 35B of the Banking Regulation Act 1949.
Investors gave a thumbs up to the announcement with the HDFC Bank share settling with gains of 3.94 per cent, or Rs 39.45, at Rs 1041.40.
Jagdishan, popularly called Sashi, pipped colleague Kaizad Bharucha who heads the wholesale banking business at HDFC Bank.
At present, the “change agent” at the bank, Jagdishan was favoured to bag the post from the two other candidates — Bharucha and Sunil Garg who heads the global commercial banking business at Citi.
Speaking after the RBI approval, Puri told a TV channel that Jagdishan was a “humane, motivational and a thorough executor” and the bank would be in good hands.
Jagdishan joined HDFC Bank in 1996 as a manager in the finance division. He became business head-finance in 1999 and was appointed chief financial officer in 2008.
He is currently the group head of finance, human resources, legal & secretarial, administration, infrastructure, corporate communications, corporate social responsibility apart from being the change agent. Prior to joining HDFC Bank, he was a senior officer in the country financial control division of Deutsche Bank, AG, Mumbai.
Jagdishan has his task cut out as he will be occupying the corner office at a time the domestic banking sector is expected to feel the pinch of the current downturn. Banks may have to grapple with higher bad loans from the second half of this fiscal as the regulatory relaxations end in September.
Further, with a domestic economic recovery still far away there is the possibility of fresh slippages.
HDFC Bank has been successful in maintaining its asset quality — the proportion of its gross NPAs is 1.36 per cent of gross advances — but the possibility of some of its retail loans turning NPAs cannot be ruled out.
Market circles said one of the biggest plus points of Jagdishan’s appointment is he is an internal candidate who is aligned with the vision of Puri.
Given HDFC Bank’s history he will have to consistently meet the lofty expectations of investors and analysts.
Moreover, he has largely handled the finance functions, and his strategy in some of the other areas will be keenly watched.