INDIA'S BEST BANKS 2012: BEST BANK-SMALL
17 Nov 2012
Why KVB is not letting a hat-trick lull it into a sense of complacency
For starters, it’s been the best in the small banks category for the third year running (it shared the limelight with South Indian Bank in 2010). It has done that by focusing on the simple things: being conservative on the assets it builds in its books and by expanding to new markets. Its growth across most parameters has beaten the banking system’s averages. First, its advances have gone up from Rs 20,216 crore to Rs 25,677 crore, and the proportion of current and savings banks accounts (Casa) to total deposits has grown by 21.68 per cent over the previous year. KVB has also expanded its footprint, taking the number of its outlets from 401 to 480 branches.
Second, it relies on a ‘workaholic’ chief to provide leadership, and its managing director, K. Venkataraman, has worked continuously for three years without a break. “I have not taken a day off for a long time,” he says. “The day I take leave will only be when I have achieved all the goals I have set for the bank’s growth.”
Third, the management understands the market and the needs of its customers well. Most of its branch network is based in south India, mainly Tamil Nadu, which has had its share of problems. Yet, that has not impeded KVB’s growth and performance.
But Venkataraman is also aware that to stay relevant in today’s times, IT and constant improvements are crucial. So, the emphasis on retail is almost a part of the bank’s DNA. KVB has expanded its retail presence, capturing NRI deposits and building retail loan portfolios. And to build on its export credit business, the bank is improving its foreign exchange trading and managing capacity.
To better serve its clients, there is an element of innovation as well. KVB offers its customers a new service whereby it collects cash and cheques from their doorstep (though delivering cash could prove to be a bit of a hassle). For their credit card customers, it has a co-branded card with one of the country’s biggest issuers of plastic: SBI Cards.
None of what the bank has achieved is possible without IT. KVB has revamped its legacy technology infrastructure and is using software that will give the corporate office a desktop-view of all the business processes of the bank on a daily basis. “We have revamped our processes without affecting our expansion plans,” says Venkataraman. So far, though, the MD and his team are cautious about industrial credit. “The economy today is suffering because of supply-side inflation, but the small companies in our portfolio are very resilient,” he says. Besides, he is yet to receive any great business plans from the power, large real estate and infrastructure space.
KVB is progressing slowly in the north, having added just seven branches to last year’s 26. And, it is looking to add more capability — such as an M&A advisory. Who knows, KVB may make a mark sooner than you think.
(This story was published in Businessworld Issue Dated 26-11-2012)