Setting the Agenda
Zarin Daruwala aims to give a big push to retail banking at Standard Chartered.
This year, this banker made a big career shift, moving from ICICI Bank to a 158-year-old foreign bank in India. "What attracted me is that it is the top job in India," explains Zarin Daruwala, who now heads Standard Chartered Bank in India, the largest foreign bank in terms of branches. The 50-year-old soft-spoken Daruwala last headed corporate banking at the country's largest private sector bank.
Daruwala initially honed her skills under the eminent chartered accountant Y.H. Malegam and later worked under some of the top leaders at ICICI Bank - N. Vaghul, K.V. Kamath, Lalita Gupte and Chanda Kochhar. Given her background, the decision to switch to a relatively smaller bank wasn't easy. "There is a new structure in place at StanChart where the regional CEO now enjoys more power in business decision-making," says Daruwala. The CEO role, like in many foreign banks in India, was earlier more focused on governance and compliance issues. The freedom and flexibility in decision-making actually played a big role in her taking up the top job.
Daruwala, who is six months into the new job, is already busy implementing the Group's global strategy in India. "India is very big in StanChart's global scheme of things. It is amongst the top three to four markets," she says. A qualified chartered accountant and company secretary, Daruwala says her mandate is to bring a balance between wholesale and retail banking. Currently, more than 75 per cent of the lending book is locked in corporate banking whereas the retail portion is relatively small. "Retail is a journey. It doesn't happen overnight," she says. In the retail segment, Daruwala would be tapping on the bank's loyal customers especially in the credit card and savings bank accounts. "We are offering retail products from very few cities. The idea is to expand the product coverage to all the branches," explains Daruwala. The bank has 100 branches across 43 cities.
Similarly, she is focusing on improving the low-cost current and savings account deposits (CASA). This is something she witnessed at ICICI Bank where the private sector bank really struggled with CASA of less than 25 per cent for almost a decade. The bank has now improved its CASA to 45 per cent levels. Today, public sector banks have a good CASA of over 50 per cent share in low cost deposits. Daruwala would like to improve CASA before jumping on retail growth as it would give the bank better margins and also a competitive advantage in the market. The bank has also embarked on a hiring spree, with 850 people set to join its retail workforce.
Unlike Indian banks, foreign banks in India face a lot of regulatory restrictions especially in setting up of branches. Currently, the share of foreign banks is less than 5 per cent in deposits and advances of the banking industry. She has to grow the bank within the given constraints.
Along with retail growth, Daruwala's eyes are also fixed on digital banking, which is making waves globally. The new differentiated banks - payments banks - are also soon going to make a debut to capture transaction banking. "We will be focusing on the last-mile adaption to Indian needs," says Daruwala, without disclosing details.
Daruwala, whose forte is corporate banking, is also providing a strategic thrust to wholesale banking. The global slowdown has impacted credit offtake and asset quality. "The bank would be diversifying its customer base and do more secured lending," she says. Many say Daruwala's immediate challenge is to put a check on deteriorating asset quality. "As a domestic banker in a foreign institution, she is in a better position to bring resolution to many of the stressed cases and at the same time explore new vistas, especially retail banking," says Vimal Bhandari, CEO of Indo Star Capital Finance.
With the economy showing signs of buoyancy, Daruwala says the growth in credit is not going to be that much of a challenge. The bank has a comfortable capital adequacy of 12.98 per cent. In a challenging operating environment, this home-grown domestic banker is getting acclimatised to working in a multinational bank. What actually surprised Daruwala about Standard Chartered is the focus on compliance, which is far higher than what she thought. "As a foreign bank, we have multiple regulators from the US, UK and India," she grins.