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"We are taking a share of growing pie": Romesh Sobti, MD & CEO, IndusInd Bank

IndusInd Bank has among the best track records in the industry, having consistently delivered good profits and reined in non-performing assets.

Romesh Sobti, MD & CEO, IndusInd Bank

Romesh Sobti, MD & CEO, IndusInd Bank

IndusInd Bank has among the best track records in the industry, having consistently delivered good profits and reined in non-performing assets. Romesh Sobti, the bank’s Managing Director and Chief Executive, tells Bhavik Nair and Shobhana Subramanian that the bank has been cautious while underwriting loans. Armed with the latest technology and products, IndusInd is ready to tap every opportunity, he says. Edited excerpts:

How big do you estimate your balance sheet will be in five years?

It’s not so difficult to predict as we are growing at around 25% and 30% annually, with the base still being relatively small at ₹1.25 lakh crore. So we should be doubling this in the next three years. Today, we have less than 1% market share.

With transactions now more IT-driven, can you win share from public sector banks?

Personally, I feel that we are already growing at our optimal rate of growth because if you press the pedal harder, something gives somewhere.

Is the growth coming from the economy or are you winning it from the competition?

I don’t think we are taking away anything from anybody. The cake is growing and we are taking a part of the growing pie. Also, because of the slowdown in the state-owned sector, the additional demand from existing clients is not picked up and spills over to the private sector. But I am very wary of accepting the proposition that huge shifts in market share will take place. Where is the capital? Even though private sector banks are better capitalised, a 10% shift in balance sheet means huge amounts of capital.

Can’t the loan book be driven by CASA (current account, savings account) since younger customers want service?

The CASA market share is a different sort of proposition. You bank with somebody because of convenience; the bank next door and who is always the bank next door.

But isn't the idea of a bank next door going away?

The part that which is going away is at the bottom end of that pyramid. This is the emerging aspirant bank account holder, right? But the values there are low; large volumes, but low values. So you catch them there and they will be really solid customers later.

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