Federal Bank Begins Work On Succession Planning

Shyam Srinivasan's latest tenure ends in September 2024 and the bank is looking to seek another extension.

Shyam Srinivasan, Managing Director of Federal Bank Ltd. (Source: Vijay Sartape/ BQ Prime)

Federal Bank Ltd.'s board has begun discussions around succession planning as the current Chief Executive Shyam Srinivasan nears retirement, according to three people with the knowledge of the matter.

The bank is planning to apply for Srinivasan's extension for another year and, hence, is expected to be around in the role for another two years, the first person quoted above said on the condition of anonymity.

According to the current discussions, the bank is expected to apply for Srinivasan's extension to the Reserve Bank of India after April 2024 as this is the last time that it can do so, this person added.

Srinivasan's current term ends in September 2024 when he would complete 14 years as the managing director and CEO. In 2021, the Reserve Bank of India had last approved his reappointment for a period of three years.

According to RBI's April 2021 guidelines, the post of the MD and CEO or a whole-time director can't be held by the same incumbent for more than 15 years.

Srinivasan, an engineer by education and an Indian Institute of Management-Kolkata alum, has previously worked at Wipro Ltd., Citigroup and Standard Chartered Bank.

Under his leadership, Federal Bank has grown from being a Kerala-headquartered bank to a lender of national proportion. Under Srinivasan's tenure, Federal Bank crossed the Rs 1 lakh crore in total business in FY13. The bank crossed the Rs 3 lakh-crore mark in FY22.

As of Sept. 30, Federal Bank's total advances were Rs 1.92 lakh crore, up 20% year-on-year. Retail advances rose 22% from a year earlier to over Rs 62,000 crore, while loans under the corporate and institutional banking business grew 15% to over Rs 68,000 crore.

Preparing A Successor

As part of the succession plan, the bank's board is also considering elevating Shalini Warrier, executive director, to the post of deputy managing director, the first person said. This is with a view to make Warrier a potential CEO candidate in the future, this person added.

Warrier was appointed ED in January 2020 and reappointed in January this year. Her current tenure ends in January 2026. She is a chartered accountant who has worked previously at Standard Chartered Bank and has more than three decades of experience in banking.

At Federal Bank, she works on enhancing market presence in the retail banking business. She is also responsible for taking forward the lender's strategic initiatives.

The succession planning discussions are still in nascent stages and are part of the bank's strategy, the other two people said, speaking on the condition of anonymity. Federal Bank did not respond to queries from BQ Prime related to succession plans.

Also Read: Voldemort In India's Corporate Sector: Succession Planning

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