Ratnakar Bank gets new-look board…….Sabarinath M
MUMBAI: Ratnakar, a sleepy Kolhapur-based bank, has taken the first step to dramatically change its management structure. The private sector lender has moved the Reserve Bank of India (RBI) to appoint Vishwavir Ahuja, former MD & CEO of Bank of Americas India operations, as the next CEO.
Present CEO SG Kutte will take over as non-executive chairman of the bank once regulatory approvals are in place.
While former Morgan Stanley India CEO Narayan Ramachandran has joined Ratnakar Banks board, Vijay Mahajan, MD of Hyderabad-based microfinance firm BASIX, has been roped in as adviser.
The banks board, which met last week, has submitted a proposal to RBI, recommending Mr Ahuja as the new CEO apart from ratifying the appointments of Mr Ramachandran and Mr Mahajan, said a person familiar with the matter. The board has also discussed a draft strategy report envisioning the road map for the bank, which runs 80 branches in Maharashtras hinterland.
According to a source, over the next few months, Ratnakar would consider raising capital through a equity rights offering. If RBI permits, portions of the unsubscribed rights could be offered to institutional shareholders, said a source familiar with the development.
The top-level appointments signal the emergence of a new management with the wherewithal to raise cash and rapidly expand operations of the bank, which rides on the unstinted support of traders and agriculturists in western Maharashtra. The 60-year-old bank was founded by Babgonda Bhujgonda Patil, an advocate based in Sangli, and Gangaram Siddhappa Chougule, a merchant from Kolhapur.
The bank plans to hire senior banking professionals and entry-level officers as it looks to accomplish a pan-India presence in the long term. Former Bank of America executive Nitin Chopra is likely to join in a senior capacity, according to investment banking industry officials.
The first sign of change was visible two months ago when the bank had appointed a panel comprising Vijay Mahajan, Mr Ahuja and Hyderabad-based banker Mannath Dalal to prepare a strategy report, detailing the road map. Simultaneously, Sanjay Bahuria, a management expert, was roped in to do a feasibility study for finalising the contents of the strategy report. Mr Bahuria looked at cultural issues and explained the contours.
The panel submitted the draft report, which dwells on the focus areas like microfinance to small and medium enterprises, among other things, to the board at its last week meeting. The report will be modified after hearing the views of the board members, said the person familiar with the matter.