Sunday, March 3, 2013

G. Nagamal Reddy

Managing Director and CEO of Tamilnad Mercantile Bank in conversation with B&E’s Avneesh Singh

One quarter into his appointment in June 2009 as MD and CEO of Tamilnad Mercantile Bank (TMB), Nagamal Reddy ran into heavy weather, what with a shareholder group fighting tooth and nail over board appointments and a High Court order looming up ahead. Things became tougher in October 2009 with RBI Regional director, K R Ananda mentioning, “The bank is having managerial problems.” But a positive November 2009 High Court order, upholding elections of new board directors, saw a new beginning for Reddy. In July 2010, Tamilnad Mercantile Bank was ranked second among all traditional private sector banks in India in the FE-E&Y awards. With the target to take the number of branches from 217 to 500 in the next few years, and the bank’s business to `50,000 crore by 2013, Nagamal Reddy seems unstoppable. Here, he chats up with Avneesh Singh of B&E giving his insights:

B&E: In the new monetary policy, the repo rate has been increased by 0.25% and the reverse repo rate has been increased by 0.50% whereas the CRR has been kept unchanged. What are your views on the same?
G. Nagamal Reddy (GNR): This was expected, but of course the only thing is that the reverse repo rate has been increased by 0.50%, which is a little more than what we expected. We knew that the RBI will take some steps towards containing inflation. I think the main aim is that they want to contain inflation and they are looking at bringing it down to 6%.

B&E: Your bank has been in the private banking space since the last nine decades. How’s competition from the new age private banks compared to that from the old age private banks?
GNR: There is no direct competition between us. Every one has got his own segment of customers. We do not have any competition from the new age private banks because our presence is not much in the metros; while new age banks are present in a big way in these centres. We are present in rural, semi-urban and urban centres.

B&E: How is your bank catering to the sunrise sectors like micro, small and medium enterprises ?
GNR: Actually SMEs have been our focus because this is one sector which contributes the maximum to the GDP of the country and also to the employment. Since we are present mostly in the semi urban and rural areas, it automatically allows us better access to SMEs. Our growth in this segment has been very good in the last two years.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

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