Axis Bank's Chief Amitabh Chaudhry Secures Re-Appointment for Third Term
In a statement, Axis Bank said the RBI has approved the reappointment of Amitabh Chaudhry as its Managing Director and CEO for a third term. This ensures his tenure at the private sector lender will continue till December 31, 2027. The bank's board had filed a proposal with the RBI in April seeking a three-year extension for Chaudhry.
The Reserve Bank of India has sanctioned the reappointment of Amitabh Chaudhry as the Managing Director & CEO of the Bank, for a period of three years w.e.f. January 1, 2025 till December 31, 2027 (both days inclusive), Axis Bank said in a notification to the exchanges.
Chaudhry joined Axis Bank in 2019 in a time of crisis on bad loans but has gone on to do some really valuable work through improving the quality of the assets of the bank, expanding its retail portfolio, and enhancing digital services. Leadership under his watch ensured a stronger commercial credit portfolio and powered growth in the wealth management business for Axis Bank. Notable during his tenure were Axis Bank's acquisition of the retail portfolio of Citi India in what was considered a strategic exercise to further enhance the bank's credit card and retail banking business.
Concerns of investors regarding Chaudhry's extension thus eased A stamp of approval from RBI has eased those investor concerns over Chaudhry's extension Suresh Ganpathy of Macquarie Capital said, "One of the major overhangs for Axis gets over; there were some worries from investors whether Amitabh will get a full three-year extension. That overhang gets cleared with RBI approval".
Axis Bank announced robust earnings for the quarter ended September. Net profit jumps 18% to Rs 6,918 crore on back of solid trading income and controlled operating costs. Analysts are relieved and this works into a form of upgrading of their estimates, especially when Bloomberg had projected a profit of Rs 6,370 crore. Net interest income, a core metric in the revenues of the bank, improved by 9% year over year to Rs 13,483 crore. However, the NIM, or net interest margin, edged down a bit to 3.99% in the September quarter from 4.11% a year earlier.
Earnings of the September quarter, Chaudhry mentioned current market conditions. "The current conditions present a lot of variables which are tough", he noted adding while the bank has excess liquidity, deposit rates remain high in the credit-to-deposit ratio. Deterioration in asset quality in unsecured segments is seen. Interest rates demanded by the top customers have however remained stable.
In this challenging environment, Chaudhry noted that maintaining a steady NIM with improved asset quality and prudent provisioning offers Axis Bank a difference. The extension brings continuity to the strategic vision of Axis Bank and stability in leadership in charting the evolving financial map.