Chanda Kochhar to be ICICI Bank CEO from May 2009
Current CE KV Kamath becomes non-executive chairman from May 2009.
Mumbai: ICICI Bank named joint managing director Chanda Kochhar as its new chief executive from May to lead India's second-largest lender at a time of declining market share, souring bad debts and a tough global environment.
Kochhar, 47, who joined ICICI as a management trainee in 1984, is appointed for five years in a move which had been widely expected with current Chief Executive KV Kamath's term due to end next April.
Kamath, who has been CEO since 1996, will take over as non-executive chairman for five years, replacing N Vaghul who retires.
India's top private sector lender, which has a market capitalisation of $11.1 billion, has lost 62 per cent of its market value so far this year as a result of its exposure overseas at a time of turmoil in the global financial system.
"The board expressed the view that Kochhar's deep experience across the bank's businesses would be invaluable in providing stability while at the same time charting the bank's future ... in the emerging global environment," ICICI said in a statement.
Analysts say Kochhar's biggest challenges will be to arrest the bank's shrinking market share and restore confidence among its depositors and investors.
ICICI Bank has the largest exposure among Indian banks to the global financial crisis and its shares have fallen by about 28 per cent since mid-September when Lehman Brothers collapsed.
As the Lehman shock reverberated around markets the world over, both Kamath and Kochhar repeatedly assured investors and depositors that ICICI was safe and well capitalised, and its share price has now recovered 68 per cent from its October low.
The bank's bad loans have been rising, though, touching 1.91 per cent of net advances in September from 1.43 per cent a year ago, it said while declaring its quarterly results.
ICICI's share of deposits and loans in the Indian banking system had fallen to 6.5 per cent by September this year from 8.7 per cent in March 2007, with a large part of the fall in 2008, according to data from three brokerages polled by Reuters.
The bank's shares were 0.6 per cent up at 474.15 rupees in a Mumbai market .BSESN that was 0.6 per cent higher.