The CEO of ICICI Bank has seen several ups and downs in her 25-year career. But the allegations of conflict of interest could be her toughest challenge yet.
Mumbai/New Delhi: Chanda Kochhar took charge as chief executive of the ICICI Bank in May 2009 at a very tumultuous juncture. It was one of the worst-affected among Indian banks by the 2008 economic downturn, and her elevation had sent waves of resentment among other senior executives, prompting people such as Shikha Sharma and Renuka Ramnath to quit.
Kochhar, who by then had been a part of ICICI for nearly 25 years, took up the challenge, personally allayed fears of investors and depositors and made very frequent television appearances to signal that all is well.
Nine years later, her bank is now strongly rallying behind her amid allegations of conflict of interest over Kochhar’s presence on a credit committee that sanctioned a Rs 3,250-crore loan to the Videocon Group. Media reports say six months after the loan was sanctioned, Venugopal Dhoot of Videocon transferred the ownership of NuPower Renewables Pvt. Ltd., a joint venture between Dhoot and Kochhar’s husband Deepak Kochhar, to the latter.
ICICI Bank has termed the reports as malicious and unfound rumours giving an in-depth justification, explaining how credit decisions do not work at the whims of a single person.
People close to Kochhar say a few in the banking fraternity have over the past few years raised questions of her husband using her position to his advantage. However, those who have worked with her also say that there is not much that can easily get the 56-year-old banker frazzled. She is known to be a woman who never has a hair out of place, a saree pleat folded unevenly or an accessory not matched.
“She is always very consistent in her speech, in her behaviour, in her clothing. Not many can manage this kind of consistency,” said a politician who has worked with Kochhar on government-appointed expert panels.
Ups and downs of a leading bank
According to an anecdote in Tamal Bandyopadhyay’s book From Lehman to Demonetisation, in 1999, Kochhar once made an hour-long presentation to the then CEO K.V. Kamath. Then a general manager, Kochhar recommended changes in the reporting structure, reducing the time for product development, ideas to avoid duplication and so on. When Kamath asked her who had given her the approval for such a study, she replied, no one.
Those who have tracked her say, with soft aggression and tenacity, Kochhar always had a close proximity with seniors and that was very critical in her clinching the top post.
From starting as a management trainee with a paltry pay of about Rs 2,000 a month in 1984, Kochhar is now regarded among the highest-paid professionals in the country. As per ICICI Bank’s 2016-17 annual report, Kochhar drew a total remuneration of Rs 7.85 crore, amounting to a Rs 2.15 lakh cost-to-company on a daily basis.
Kochhar graduated from the Mumbai-based Jamnalal Bajaj Institute of Management Studies where she met her future husband, Deepak Kochhar.
In her early days at ICICI, Kochhar handled various projects in industries such as textiles, paper and cement. When the group was launching its bank in the 1990s, she was its first employee and part of the core team. In 1998, she was promoted to the post of a general manager heading ICICI Bank’s major client group comprising its top 200 clients.
In 2000, she took up the job of building ICICI Bank’s retail business and later went on to take charge of its international and corporate business. When the global economy was on a rocky road between 2007 and 2009, Kochhar was in the forefront of firefighting as a chief financial officer of the bank.
Amid attrition at the senior level after Kochhar’s appointment as the CEO, there were a number of skeptics doubting her ability and competence. A senior professional close to Kochhar said, “I had doubts too, but I soon saw her doing the right kind of things. She started consolidating the balance sheet. She realised it was time not to grow, but to shrink.”
“But after the initial phase of consolidation, post 2011, she seemed to have lost the plot a bit. She perhaps misread the economic trend. ICICI’s risk management was also compromised. A lot of assets turned bad,” the person close to Kochhar added.
Over the past two years, ICICI’s bad loans have ballooned, profitability has been hurt and the growth in its asset base — a key indicator of the bank’s size — has been muted. Meanwhile, HDFC has swiftly taken over as the country’s largest private sector bank.
As of September 2017, ICICI Bank’s total asset base was Rs 7.87 lakh crore, while that of HDFC Bank’s stood at Rs 9.33 lakh crore. ICICI’s market capital is at Rs 1.8 trillion, while HDFC is far ahead with Rs 4.90 trillion.
Proximity to power
Kochhar has also worked closely with the current BJP-led NDA government. In 2015, ICICI Bank adopted Gujarat’s Akodara village as a pilot project under Narendra Modi’s pet ‘Digital India’ mission. She has also worked with the Devendra Fadnavis-led government in Maharashtra as a member of the task force for the proposed International Financial Services Centre at the Bandra Kurla Complex.
“She was given the responsibility of finding out what are the strengths and weaknesses of building complementary partnerships of the Mumbai IFSC with other IFSCs across the world. She recommended establishing a South Asia-Middle East corridor with partnerships in Qatar and the UAE,” the official said.
She helped Fadnavis in organising one of his earliest human resource activities after he took over as CM, an off-site for bureaucrats, by making the ICICI training centre at Khandala available. Senior ICICI economists also conducted sessions for the government.
Incidentally, Kochhar herself was an IAS aspirant at one point of time, but was drawn to the allure of Mumbai’s booming financial services.
The flag-bearer for working women
Kochhar, a Padma Bhushan awardee, has always batted for gender neutrality at work and has often said in her interviews that she leaves her womanhood at the doorstep of her work.
On women’s day two years ago, ICICI launched a programme allowing women to work from home for up to a year. Kochhar said an internal survey had shown the bank that women who leave the organisation mostly do so for childcare or maternity.
Perhaps it has something to do with her own experiences. Kochhar was born in Jodhpur and brought up in Jaipur. She was 13 when she lost her father. Her mother had to solely take the responsibility of bringing up Kochhar and her two siblings.
In a letter to her daughter, Aarti, which was published in Sudha Menon’s book, Legacy: Letters from Eminent Parents to their Daughters and went viral on social media, Kochhar relates the lessons she learnt as a child to her role as a working mother now. She has also attributed her ability to be a successful working mother to the ample support that her husband and children have given her.
In the letter to her daughter, Kochhar wrote, “If you had complained and whined about my extended absence from home, I would never have had the heart to make a career for myself. I am blessed with a great and supportive family.”
As she grapples with the crisis sparked by the conflict of interest allegations, Kochhar will in all likelihood have to dig deep into the attributes and support that helped her rise to the top.