IDFC unveils logo for the bank, announces management team

In the run up to the official launch of the bank on October 1, infrastructure lender IDFC Thursday announced the A-team that will be leading the bank’s operations. Among them, Anil Baijal will be the Non-Executive Chairman of IDFC Bank. Rajiv Lall will relinquish his position as the Chairman of IDFC Ltd and be the Executive Vice Chairman and Managing Director of the bank. The other key people will be Ajay Mahajan, who will head the bank’s commercial and wholesale operations, Naval Kumar who will lead the bank’s Personal and business banking, Ravi Shankar will head Bharat Banking and Sunil Kakar will be the bank’s Chief Financial Officer. Unlike its peer Bandhan Bank, that was granted a universal banking license along with it, IDFC will have a very different strategy.The bank will focus on three key areas of business: Wholesale and Commercial which will constitute two thirds of its business, Rural and Personal & Business banking which will together account for a third of the business.The bank will begin operations with a balance sheet of 70-80,000 crore rupees and is confident of growing its bottom-line by 10-15 percent every year for the next few years. In order to avoid the over-hang of bad loans on the bank’s balance sheet, IDFC has made provisions of 4,500 crores over the past six quarters and therefore expects to have net non-performing assets of only 2-2.5 percent as a bank. The stressed assets, which will include restructured and bad loans, will account for 15 percent of its total book. While the infrastructure lender has only 400 customers as of now, it plans to grow its customer base to 15 million by the end of 5 years. A majority of these customers will come from its rural banking portfolio, which is expected to grow to a size of 10,000-15,000 crore in the next few years. The bank will start with 23 branches on Day one, and grow to only 60 by the end of the year, unlike Bandhan Bank which started day 1 with 20 times the number of branches. IDFC Bank will not adopt the branch-heavy strategy of its peers to reach customers. Instead, it will leverage its Payments Bank tie up and use technology to grow its customer base.