Rana Kapoor: The Growth Machine
He has built a solid financial franchise with his unique approach to knowledge-driven banking that’s upscaling on technology
Photo Credit : Ritesh Sharma,
Rana Kapoor bagged a license to set up Yes Bank back in 2004 and has since built it into one of the largest private sector banks in the country, with total assets of over Rs 3.12 lakh crore. Now, Yes Bank is a seasoned corporate and SME bank franchise with segments across 12 business units, and a rapidly growing retail business. The bank followed a knowledge-banking approach, focusing on sunrise sectors such as renewable energy, media and entertainment, education and health care.
Now Yes Bank ranks sixth among private banks in market value at Rs 79,611 crore. Little surprise that Rana Kapoor, Managing Director and CEO, Yes Bank figures high once again on the list of BW Businessworld’s Most Valuable CEOs.
Yes Bank has focused on a deep understanding of its customers’ businesses; it follows a detailed customer relationship management style right up to the highest level across its roster of SME and retail clients. This provides the Bank with a platform for a solutions-oriented approach by offering a bouquet of products and services.
Yes Bank has always trained its lens on risk management and is one of the few with a well-established risk-management framework. Says Kapoor, “To ensure robust risk management, Yes Bank follows the 3-eye principle which ensures every credit decision is evaluated independently by Relationship, Product and Risk Managers in the aforementioned relationship groups. This approach also ensures proactive risk management by identifying early warning signals, and ensuring that timely action is taken on the portfolio.”
Yes Bank has one of the lowest levels of non-performing assets in the unforgiving business of financing. Its net NPAs s of March 2018 were 0.64 per cent, which improved substantially from December 2017 quarter’s 0.93 percent.
Not only that, the bank has a strong liability franchise and has been successful in raising capital at regular intervals in all market conditions, and through different routes, including Green Infrastructure Bonds and large QIPs. Over the years, it has raised funding from leading global financial institutions, demonstrating commitment. As a result, it has accessed the broader markets, resulting in long-term stable funding at fairly attractive prices.
On the performance front, Yes Bank has consistently delivered across parameters of growth and profitability. Its advances have clocked a steady 27 percent CAGR over the last five years, while net profits increased 28 percent. It enjoys a high return on assets (1.5 percent) and has been clocking returns on equity of 18 percent.
Yes Bank has invested significantly in people, infrastructure and technology. It has been a keen supporter of adopting new technologies and recently undertook a comprehensive survey of opportunities arising out of Fintech. The survey noted that India is at an inflection point for a hockey-stick growth curve in Fintech.
Says Kapoor: “Since its inception, the Bank has leveraged technology and innovation as mission-critical pillars, pioneering implementation of several technology initiatives in corporate and retail banking services. Yes Bank has also been partnering with Fintech start-ups through Yes Fintech which has become one of the leading Fintech accelerators in India and the only bank led-accelerator to go global, forging partnership with 10+ key global accelerators.”
Yes Bank is training its lens on becoming a comprehensive commercial and retail banking institution with a 3 percent plus market share. It expects a multiplier effect in consumer retail, which would be the key driver of its growth strategy. When he started, Kapoor’s dream was to set up the Finest Large Bank, an achievable target today. Of course, India bole, “Yes”.
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