 "Chandra Shekhar Ghosh")
Bandhan Bank Managing Director and Chief Executive Officer (MD & CEO) Chandra Shekhar Ghosh would retire after the completion of his current tenure on July 9, the lender said in a regulatory filing on Friday.
Ghosh has led the bank since July 10, 2015. Upon his retirement, he will play a strategic role at the holding company level, Bandhan Financial Services Ltd (BFSL), which owns 40 per cent in the lender and has stakes in life insurance and mutual fund ventures.
The screening and selection committee of the board will start the process of selecting the probable candidates and recommend to the Reserve Bank of India (RBI) for approval, sources said. According to norms, a bank has to send at least two candidates in the order of preference for approval.
Bandhan board had on November 24, 2023, approved Ghosh’s reappointment for a period of three years.
“After leading the bank for almost a decade, including three consecutive tenures as MD & CEO, I feel the time has now come for me to assume a larger strategic role at Bandhan group level. Hence, I have decided to retire from the services of Bandhan Bank at the end of my current tenure as MD & CEO, i.e. on July 9, 2024,” Ghosh said in his resignation letter to the board.
The letter is enclosed with the stock filing. Recollecting the journey, Ghosh mentioned in the letter that Bandhan was set up in 2001 as an NGO to meet the dual objective of women empowerment and poverty alleviation. “I started with my own savings, contributions from some relatives and borrowings from moneylenders. Once the model was proven, financial institutions came forward to lend and support.”
The letter is enclosed with the stock filing. Recollecting the journey, Ghosh mentioned in the letter that Bandhan was set up in 2001 as an NGO to meet the dual objective of women empowerment and poverty alleviation. “I started with my own savings, contributions from some relatives and borrowings from moneylenders. Once the model was proven, financial institutions came forward to lend and support.”
In 2006, Bandhan acquired a non-banking finance company (NBFC) and named it BFSL. BFSL moved on with microfinance activities, while the NGO continued with development work.
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In 2010, it may be mentioned, the pecking order in the MFI industry changed as BFSL toppled SKS to become India’s largest MFI. This happened as Andhra Pradesh, a major centre for the microfinance industry, passed an ordinance barring MFIs from collecting dues and disbursements after several borrowers committed suicide on account of high interest rates and alleged coercive collection methods. And so the pecking order in the industry changed.
“In 2013, the government of India announced guidelines for issuing fresh bank licenses. BFSL and I jointly applied for a banking license in July 2013. The RBI announced on April 02, 2014 about issuing in-principle approval to only two entities, Bandhan was fortunate to be one of them,” Ghosh wrote in the letter.
Bandhan Bank was launched on August 23, 2015. It started with 501 branches and 50 ATMs spread across 24 states. “It became the first ever microfinance institution to be a universal bank in India and the first private sector bank to be set up from eastern India after Independence,” Ghosh said. Bandhan Bank went on to list on the bourses in 2018; in 2019, it bought HDFC-owned Gruh Finance, an affordable housing finance company.
Ghosh mentioned that the journey had not been without challenges — demonetisation in 2016, goods and services tax introduction in 2017, cyclones Fani in 2019 and Amphan in 2020, and the pandemic were among them. “After an extremely tough 2022-23, I am heartened to see recovery of the bank’s portfolio in 2023-24,” Ghosh said.
“Notwithstanding the challenges, in almost 9 years, Bandhan Bank has garnered Rs 1.35 trillion as deposits, and advances stand at Rs 1.28 trillion as on March 31. Year-on-year growth has been impressive,” he said in the letter.
