State Bank of India: Battening Down the Hatches

December 10 2020

This is part of the Euromoney 25 Series

Dinesh Kumar Khara takes the helm as chairman of State Bank of India at a challenging time.

Rajnish Kumar, who stepped down after completing his three-year term in October, had to batten down the hatches as the bank faced up to Covid-19 in one of the world’s worst-affected countries. Now Khara must find a way to pilot the bank out of the pandemic in preparation for a post-virus future.

He has experience on his side. Khara joined SBI as a probationary officer in 1984 and has been a managing director since 2016, covering the global banking and subsidiaries unit. He was instrumental in the multi-sided merger that Arundhati Bhattacharya engineered during her spell as chairman.

Few can claim to know the ins and outs of the bank better than Khara.

SBI faces challenges on an altogether different scale to most institutions. It is listed and is expected to make profits like any other bank, but it is also 57% government-owned and has a continuing mandate on social responsibility in a country still afflicted by great poverty.

Bhattacharya once explained to Euromoney that it wasn’t quite fair to compare her bank with those of Western nations because Western banks don’t have a considerable proportion of customers who can’t read or write and must use their thumb impression to withdraw money, which then has to be counted out to them orally because they can’t read the numbers on the notes.

An institution with these conditions clearly has a tougher job than most when a lethal pandemic sweeps through. India has had 9.1 million cases of coronavirus, roughly one in six of confirmed cases worldwide. The true figure may be much higher.

Such is the density of the cities and the nature of the economy, it is no simple matter to tell India to work from home; and a great many of those afflicted – whether directly by health or indirectly by loss of livelihood – are within the SBI orbit.

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