A week in a PSU banker's life

Pages from the diary of a banker that offer glimpses of his work and life

Last week’s Banker’s Trust column on the work culture of public sector banks excited many bankers. Quite a few of them have reached out to me with their stories. Among their peers in the private sector too, not everybody is enjoying their job. They say the fear of losing jobs when they miss targets hangs over their head like the sword of Damocles.

From our conversation, I am recreating the diary of a general manager in a public sector bank. It gives an idea of how they balance their work and life.

Sunday: It was not a holiday for me. We have a board meeting slated tomorrow. I needed to go through a string of large-value credit proposals, which will be discussed at the meeting. I must know every minute detail. If there are gaps, the government’s nominee director may pass snide remarks. They are addressed to the MD and CEO but I feel morally responsible. I had to skip the doctor’s appointment for my wife.

Monday: Due to the late arrival of one of the directors, a member of the credit committee, the board meeting could not start in time. In the meantime, the general manager (recovery) was asked to advance his presentation. Unfortunately, it was not his day. He was not well-prepared and fumbled too many times. As expected, the nominee director of the government remarked, “Mr MD, either you have to instruct your GM to be well prepared for presentations or you have to find an alternative … We are not here to waste our time.”

We have managed to arrest fresh slippages but still the meeting was not exactly cordial. The ED in charge of recovery was asked to present a road map at the next board meeting on how the NPAs could come down further. After all, things are looking up for all banks — low NPAs and record profits are the order of the day!

I was almost exhausted, waiting for my turn to present the credit proposals. Instead of 12:30 pm, I got the opportunity well past 3 pm. I skipped my lunch. My presentation went off well. The meeting continued till late in the evening and there was dinner and drinks in a five-star hotel. I was not in the mood to eat or drink. I was given a stiff target for gold loans.

Tuesday: In our parlance, today was the log-in day for the gold loan sanctions — the launch date of a campaign.

Gold loans are a darling for all banks. We are slow to catch up. On paper, sanction and disbursement of gold loans appear to be a cake walk as gold is the primary security. If sufficient margin is kept, recovery is not difficult. In case of a default, we can always sell the gold ornaments kept with us. But it could be very risky if the assessment is poor and gold turns out to be spurious. Then, there could be stolen gold offered to us as collateral. Also, the velocity of gold loans is the highest among all loans as the borrowers are always in a hurry to pay off the debt and take the gold ornaments back home.

I chalked out the strategy, had a video conference with my colleagues, but it was not easy. We will have to fight it out with other banks and particularly the NBFCs specialising in gold loans. The performance of the day was not up to the mark. One of the EDs asked me to pull up the socks.

Wednesday: Today, a senior executive of the local office of the Reserve Bank of India dropped by for a discussion with the GMs on the annual financial inspection. As expected, the focus was primarily on credit and NPAs. The regulator had many questions for the credit department — how a finer pricing has been given to certain borrowers even though the credit rating is poor; why further disbursements are proposed even when the assets are showing signs of incipient sickness; AAA/AA+ rated accounts are very few in numbers; the bank guarantee audit has not been carried out for exceptionally large accounts, exposing the bank to huge risk.

We could not answer all queries to the regulator’s satisfaction. The RBI executive advised us to be in Mumbai for the closure of the reports. This did not make our MD happy.

In the evening, I went to the airport to receive the Parliamentary Committee on Agriculture. There’s a meeting tomorrow to analyse the reasons for poor agri credit flow. Since we are the lead bank in this state, we need to arrange everything.

Not all committee members were polite. One of them gave his hand bag to me for carrying. He was not very happy with the AC of the car and questioned why such a car was booked. He was not pleased with the hotel accommodation either. He told me to wait outside the room. After half an hour, he called me inside and asked me to arrange some fresh fruits. It was past 10 pm.

Thursday: The chairman of the committee was a decent person. The GM (agriculture) was pulled up for not extending sufficient credit to the farmers. One of the committee members even commented that the GM should be ashamed of drawing his salary as he has failed to discharge his responsibility. The ED in charge of agriculture loans made a feeble attempt to defend the GM but in vain.

As the convenor of the state level bankers’ committee, we have called an urgent meeting tomorrow where the chief minister would review the performance of the banks. I hit the bed early but sleep came very late.

Friday: I had a strong premonition that the SLBC meeting would not be easy. The state elections are a few months away and it’s only logical that there would be scrutiny of what the banks have been doing.

The adviser to the CM was very caustic in his remarks: The bankers have done nothing to implement the schemes of the state government and there has hardly been any credit extended to the farmers. He instructed the state treasury not to allocate any funds to those banks, which have not complied with the instructions of the government. He even said no minister would meet the bankers. The CM kept his cool all along the meeting but his adviser was liberal with filthy language.

Saturday: This being the yearly closing month, the central statutory auditors wanted to have one meeting with the recovery and credit team for arriving at the NPA figure. This exercise is always a pain for the GMs and other senior executives as the rise in bad loans forces a bank to provide for more. Thankfully, we have been doing well and our operating profit can support higher provisioning. But the auditors identified more NPAs and, as a result of this, the Tier-1 capital could be eroded. The discussion continued till midnight. A dinner was planned in a five-star hotel for the auditors but none could leave the bank. We ate midnight — chapati and stone-cold butter chicken with salad. The gulab jamuns were cold and hard.

We returned home in the wee hours. We would need to come to office this Sunday too as the matter could not be settled with the auditors. Plus, there is another meeting on Monday on a particular account which the lead lender has already declared as fraud. We need to take the call.

The writer, a consulting editor of Business Standard, is an author and senior adviser to Jana Small Finance Bank Ltd

His latest book is Roller Coaster: An Affair with Banking

To read his previous columns, log on to https://bankerstrust.in

Twitter: TamalBandyo