October 26, 2009

We have to work on number of areas like organisation structure, balance sheet and profit & loss, infrastructure, people and governance. For instance, on the balance sheet front, we tried to analyse the reasons behind high cost of deposits and low yield on loans. We tried to make our organization structure more customer friendly by making branches the fulcrum of activities. The branch manager was made entirely responsible for all functions like sales, operations and service.

The branch manager was also given the mandate to mobilise low cost deposits from his/her catchment area.On the people side, we have dramatically expanded our employee base. In March 2008, we had 2,700 employees on board, which has grown to 4,800 by now. We brought new people in product team, corporate banking and several other areas of business.We also introduced the concept of variable pay, which was almost non-existent before the management change in February 2008. In FY 2009, 17% of our salary bill was on account of variable component.