Arundhati Bhattacharya is driving deep-rooted change at the country's largest bank, the State Bank of India, making it nimble, tech-savvy and receptive to changing customer preferences. And she's far from done
Forbes India Leadership Award: Best CEO-Public Sector
It’s a hot autumn day in India’s financial capital, and the 19-storey State Bank of India (SBI) building, in the heart of south Mumbai’s Nariman Point business district, is undergoing a makeover. The façade is being given a facelift and extensive repairs are under way. This transformation at the country’s largest bank, with a standalone balance sheet size of over Rs 20 lakh crore, isn’t just cosmetic. Inside the building, which is home to one of the biggest and most significant financial institutions in the country, there is some serious work going on to ensure the bank itself—and not just the building—gets a spanking new look, in line with changing times.
THE ACCIDENTAL BANKER
The steely resolve Bhattacharya has shown in getting SBI—generally seen as slow, stodgy and old-world—to embrace change aggressively can be surprising given that she never aspired to be a banker at all. Bhattacharya spent her early years in the rough and tumble of industrial towns Bhilai (Chhattisgarh) and Bokaro (Jharkhand), where her father was an electrical engineer. Her mother studied homeopathic medicine to address the lack of medical facilities in and around the area. Bhattacharya completed her graduation in English literature from Lady Brabourne College in Calcutta (now Kolkata) though she was initially fascinated with biochemistry. She sat for the SBI probationary officers examination since she needed a job and, in 1977, joined the bank.
“It [banking] was very accidental,” she admits. “I had no ambition of becoming a banker; it just happened. But I stuck to it and enjoyed the challenge.” From her first assignment at the foreign exchange department of the SBI Main Branch in Calcutta until now, Bhattacharya has had several assignments that have taken her to various cities and towns and even to the United States. In the process, in the 38 years she has spent at SBI, it has been akin to switching jobs 12 to 14 times, given the varied nature of her assignments. From setting up new businesses and joint ventures for the bank to investment banking, human resources, corporate development and even being the bank’s chief financial officer (CFO), Bhattacharya has performed several key functions, a factor that has led her to understand the working of the banking behemoth in great detail.
The new businesses assignment, however, is the one she lists as her most challenging, since during the period of a year and eight months she had to stitch together three joint ventures with foreign partners. She also set up the mobile banking platform, among other things. “I also launched a financial planning platform that didn’t really take off then, but had I got more time perhaps I could have made that work too,” she says. “That period was very challenging but also very satisfying. A lot of what we did then is coming to fruition now.”
It is this multiplicity of roles she has played at SBI that is now proving to be her greatest strength as she aims to rebuild SBI and make it future-ready. Her stint in investment banking, for instance, led her to view projects in their entirety—debt, equity and other combinations—rather than as pure loan accounts. This has helped her better understand the stresses of projects and their promoters. One firm, for instance, which SBI is actively helping turn around is wind energy company Suzlon Energy, which was till recently hurtling towards disaster. Today, with Bhattacharya actively involved in the restructuring, Suzlon is on the road to recovery, thanks to a strategy that involved selling key assets and bringing in a strategic investor in the form of Sun Pharma’s Dilip Shanghvi.
Says Tulsi Tanti, chairman, Suzlon Energy: “She [Bhattacharya] is focussed and plain-speaking without any ego. She does not mind calling a spade a spade and saying ‘no’ if something cannot be done. She has financial acumen with [an] entrepreneurial approach and has clarity on the way the bank needs to function with each of the customers.” Tanti, who acknowledges the help SBI extended in helping Suzlon turn around, adds that Bhattacharya understood his intent to get the company back on track and “went ahead with a couple of bankers to release project-specific exposure so that the company continues as a ‘going concern’.”
Bhattacharya’s financial acumen that Tanti speaks of was honed further during her stint as CFO. “A doctor sees a patient and says what is wrong. But if you have the blood report you will know everything. The CFO’s role is like that. The CFO is in charge of all the numbers and you really get to know the bank in a very, very deep way. No other department knows it that deeply. That role brought with it a lot of learning. I had the blood report of the bank,” Bhattacharya says.
REWIRING THE OLD GIANT
Most management experts acknowledge that it’s easier to set up something from scratch rather than rewire a legacy institution. Getting a 209-year-old bank like SBI to change was, therefore, not going to be easy. However, Bhattacharya knew that with the competitive environment changing rapidly, key rivals embracing new technology and with customer preferences changing with changing demographics, SBI would need to move decisively to keep in step with the times. Consequently, the bank put together an aggressive digital strategy, which included drawing on the power of digital, mobile and social, and unveiled several offerings on these fronts. Alongside, the bank put together key partnerships with new economy firms like Amazon, Snapdeal, PayPal, taxi aggregator Ola and others to extend its reach and capture new customers. It has also launched SBI Buddy, an e-wallet offering, which Bhattacharya hopes will bring in younger customers into the bank.
“We are putting in major efforts on digitisation. We started with the brick and mortar piece, getting the InTouch branches in place. We are also examining what really works and what is too futuristic. The e-wallet has come in now and the partnerships have also started working,” she explains.
Bhattacharya’s game plan is simple: In an age where digital banking is getting increasingly commoditised, she wants SBI to remind people that when it’s a question of money, trust and security are paramount. “It’s good to be cool when you’re very young, but at a certain age you realise coolness alone will not do. You need security, stability and trust. So whatever we’re doing, we’re trying to do as transparently as possible and trying to communicate that we’ve been around for 209 years and don’t have the intention of going anywhere. We are still the government’s largest bank.”
FACING CHALLENGES
As someone who has broken into a male bastion as the first woman boss of SBI ever, Bhattacharya takes challenges in her stride. Has it been tough for her as a woman leader? “Today there are many women heads of Indian banking,” she responds quickly. “Not just in public sector banks, but also in private and foreign ones. Being a woman, there will be perceptions and doubts about whether you are going to put your family ahead of your work. Many bosses keep worrying about that. So, early on in life you have to build a reputation that you’ll do what it takes, and that you can manage both.”
(This story appears in the 16 October, 2015 issue of Forbes India. To visit our Archives, click here.)