 "Narayanan Vaghul")
This report has been updated.
Narayanan Vaghul, renowned Indian banker and an institution builder in the financial sector, passed away today in Chennai. He was 88.
Narayanan Vaghul, renowned Indian banker and an institution builder in the financial sector, passed away today in Chennai. He was 88.
He was admitted at Apollo Hospital in Chennai two days ago after he fell and was unconscious. He is survived by his wife, daughter and son, family sources said.
Born in Chennai in 1936, Vaghul was perhaps among the very few to have seen the evolution of India’s financial sector. Starting his career as an officer with State Bank of India (SBI) and moving up the ranks over his two decade stint with the country’s largest bank, Vaghul became the youngest chairman of a state-run lender at the age of 44, when he took over as chairman and managing director (CMD) of Bank of India in 1981.
The Commerce graduate (acquired Bachelor of Commerce (Hons) Degree, University of Madras in 1956) left the public sector lender in 1985 to take up a position at a development finance institution Industrial Credit and Investment Corporation of India (ICICI), which has now evolved as ICICI Bank.
This is where Vaghul laid the foundation that has also made him known as the man who introduced the concept of ‘Financial SuperMarkets’ to the country, a model that other prominent banks have also seen to have followed.
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In a post on X (formerly twitter), Shaktikanta Das, governor, Reserve Bank of India (RBI) said, “(Vaghul) A visionary. Made huge contribution to India’s financial sector. Every interaction with him was refreshing.”
In the late 1980s, Vaghul initiated venture capital endeavours at ICICI and subsequently established its wholly-owned subsidiary, TDICI, aimed at providing technology venture capital. The firm is now known as ICICI Venture Funds Management Company. Likewise, in 1995, under his leadership, ICICI Securities was set up as ICICI Brokerage Services.
The former chairman of ICICI Bank also played a pivotal role in persuading another luminary, KV Kamath, to return to India from the Asian Development Bank in the mid-1990s to head ICICI. As its MD and chief executive officer (CEO), Kamath introduced consumer lending initiatives, diversifying the industrial lending focus of ICICI Bank.
Paying his homage, Kamath said, “I have always looked up to Vaghul as my mentor. He was always there for all of us at ICICI as a leader, a friend, philosopher and guide.”
He brought this freshness of doing something different, something innovative and at scale and drove its implementation. And this underpinned everything that happened thereafter when he led ICICI. “We quickly put in place a strategy function, thought of new business ideas, started recruitment at scale and built the foundation of this new ICICI,” Kamath said.
V Vaidyanathan, MD & CEO, IDFC First Bank, who knew Vaghul for over 20 years, said he is simply irreplaceable, a combination of distilled wisdom, wit, and simplicity rolled into one. An extraordinary person.
Vaghul’s mantra for running a company or business organisation was that the success of the business lies in the choice of people, even if it means making some tough decisions. Developing genuine concern for people was a cornerstone of management style, said a former banker who worked with him at ICICI Bank.
Vaghul’s mantra for running a company or business organisation was that the success of the business lies in the choice of people, even if it means making some tough decisions. Developing genuine concern for people was a cornerstone of management style, said a former banker who worked with him at ICICI Bank.
Another private sector banker said, Vaghul sir will always be remembered for nurturing and supporting women leadership. ICICI group has given many women CEOs like Kalpana Morparia, Chanda Kochhar, Shikha Sharma, he said.
Vaghul was also instrumental in setting up rating agency CRISIL. Pradip Shah, founder managing director of India’s first and largest rating agency CRISIL, said Vaghul was a visionary. He spawned many institutions be it rating agency, venture fund industry. Blessed with a sense of humour, he had broad shoulders to absorb criticism. He spoke out his mind to power that be without fear, Shah said.
During the Rajiv Gandhi administration, Vaghul was entrusted with leading ICICI Bank. Following financial liberalisation in 1991, numerous financial conglomerates emerged, yet Vaghul indisputably spearheaded this movement. IDBI, UTI, and SBI all diversified into various sectors of financial services, drawing inspiration from ICICI's Vaghul-crafted strategy.
Vaghul was honoured with the Padma Bhushan in 2010 in recognition of his contributions to trade and industry.
A keen believer in holistic approach to life, he was a student of Vipassana meditation and Yoga himself. He advocated spiritual discipline to realise one's full potential. Going beyond business life, he was also closely associated with educational institutions like Pratham and Chennai-based Institute for Financial Management and Research (IFMR).
Additionally, Vaghul served as a director in various prominent Indian conglomerates, including Wipro, Mahindra & Mahindra, Apollo Hospitals Enterprise, and Mittal Steel.
He was an ardent proponent of institutional ownership of banks and opposed corporate ownership. India has learnt from its pre-bank nationalisation experience and will never repeat the same mistakes by allowing large corporations into banking, Vaghul had said.
Narayanan Vaghul (1936 – 18th May, 2024)
1956 - Joined as an officer at State Bank of India (SBI), where he moved up the ranks over two decades before moving on
Late 1970s - Took up a teaching position at the National Institute of Bank Management (NIBM). In less than two years, he became its director
1978 – Appointed executive director of Central Bank of India, a position he served for 2 years
1981 – Appointed as chairman and managing director (CMD) of Bank of India, becoming the youngest chairman of a bank at 44 years
1985 – Appointed CMD of Industrial Credit and Investment Corporation of India (ICICI), which has now evolved as ICICI Bank
Late 1980s – Initiated venture capital endeavours at ICICI and subsequently established its wholly-owned subsidiary, TDICI, aimed at providing technology venture capital. He chaired TDICI, now known as ICICI Venture Funds Management Company, until 1996
May 3, 1995 -- ICICI Securities was incorporated as ICICI Brokerage Services; in 2000, the company launched its electronic brokerage platform ICICIdirect.
1996 - Persuaded KV Kamath to return to India from the Asian Development Bank (ADB); Kamath returned to ICICI as its MD and chief executive officer (CEO), and introduced consumer lending initiatives, diversifying the industrial lending focus of ICICI Bank
1996 - Vaghul became non-executive chairman of ICICI Bank, which he served till 2009
2010 - Awarded Padma Bhushan, country’s third-highest civilian award in the trade and Industry category
2012 - Forbes Philanthropy award in 2012 for his active involvement and assisting philanthropy causes
(Source: Wikipedia, media reports, websites)
