Sunday, December 22, 2013

Oh Kolkata! - Episode No.17

My initial days in Canning Street were marked by employee-related problems and I could hardly concentrate on my regular banking job. However, somehow I managed to keep things under control in my Deposit Section. My movement to credit department coincided with the arrival of the new team of Nayak and Guinn. I was given a real free-hand to deal with the things in my department by this team.  Within a short time I was in the thick of action and started deriving satisfaction out of my job.

Nayak was closely monitoring my performance and I could gain his confidence early. One day he told me in the presence of Guinn that he was delegating his entire sanctioning and discretionary powers to me.  I was free to use his full powers for the deserving parties. I could exercise them without any prior concurrence from him in all the cases. It was left to me to discuss the matters with him only if I felt it necessary. He wanted me to take independent decisions and this was his way of encouraging me by expressing his full confidence in me. I should say that I was truly blessed to work under the leadership of a person like Nayak in my first assignment as a Credit-Manager.

Nayak had one problem to face in his early days in our branch. Three of his predecessors had been posted in Kolkata only. While Ramamurthy was in L C Road Branch, his immediate predecessor was in the Circle Office and the other person was heading the Divisional Office. Many of the branch customers, particularly borrowers, were keeping in touch with them.  Immediately after giving a proposal they would visit them and request them to ensure that the proposals were sanctioned. While Ramamurthy never interfered in our branch affairs, the person in the Circle office used to ring up the branch to influence our decisions. It became a sort of nuisance for us. Nayak was a person who did not like any interference in his decision-making process. He used to tell jocularly that Canning Street branch appeared to be having more than one Divisional Manager (DM)! But he put a full stop to the practice by telling the man at the Circle Office bluntly to keep away. He also made it clear to the customers concerned that he would entertain no such interference in future. 

Nayak had another legacy to handle. Again the man at the Circle Office was the reason behind it. During his regime, the sanctioning powers of the DMs at the branches had been substantially enhanced by the Head Office. He took full advantage of the same. There were many borrowal accounts of jute traders in the branch with secured bill discounting facilities. The limits enjoyed by them varied between Rs2 lakh to Rs10 lakh. The HO had enhanced the sanctioning powers of DMs for such bills limits from Rs 3 lakh to Rs10 lakh. Immediately on receipt of the new circular from HO, the DM had uniformly and unilaterally enhanced the limits of all such parties to Rs10 lakh by obtaining proposals from them!

But the DM had conveniently ignored a rider attached to the enhanced powers by the HO. It was clearly mentioned there that the enhancement was subject to the prevailing credit restraints. In view of the tight money conditions prevailing at that time, the branch DMs were to seek prior clearance from the circle office for any enhancement in the existing limits of the parties. When the Circle Office came to know about the en masse enhancement of the limits of the parties, the action of the DM was firmly disapproved. The branch was asked to revert to the earlier limits. It was a great embarrassment for the branch. As the parties had utilized the limits in full, it was virtually impossible to reduce the limits. But the Circle Office went on following up the matter from the AGM level. Ironically the DM was transferred to the Circle Office at this stage and he escaped the embarrassment of facing the parties at the branch!

The issue was kept open during the short regime of Ramamurthy also. It fell on the shoulders of Nayak to resolve the issue. As Credit-Manager it was for me to arrive at a solution. We made a list of all such parties and studied the genuine needs of the parties and their eligibility for such enhancements. Wherever we found the needs genuine, we discussed the matter with the AGM and obtained his concurrence for enhancement on a case-to-case basis. For the rest of the parties we reduced the limits gradually to the need-based level under due persuasion.

There were several consortium advances in our branch. While our bank was not leader in any of these consortiums, the leaders were mostly UCO Bank and United Bank of India, both being Kolkata-based. While our bank was meticulous in adhering to the working capital assessment norms and post-sanction follow up, the Kolkata based banks lacked such expertise in general. They would simply go by the assessment made by the corporates themselves without making a proper appraisal of their own. I had the opportunity to attend several consortium meetings accompanied by a representative of our Circle Office in the cadre of a Senior Manager. Generally the leader bank would try to ignore our observations during such meetings.

The posting of K S Rao (KSR) as AGM to our circle office changed the situation completely. He had made it a point to attend all such meetings along with the Manager of the section. KSR was very thorough with the nuances involved in the working capital assessment of corporates. He would raise several queries on the performance of the company and the assessment made by the lead bank. The representatives of the company and the lead bank were finding themselves in an embarrassing situation. They were neither capable of answering the queries nor they could ignore the points raised by him! There were instances where the company representatives had to flatly admit that there were no genuine reasons for the enhancement in limits sought by them even though the lead bank had already agreed in-principle! KSR became a nightmare for such corporates and the lead bankers in Kolkata. He was like bull in a China shop as far as the consortium meetings were concerned. Nayak had a very close rapport with KSR and that helped us immensely in solving several problems in our branch.

Nayak was a very light-hearted jovial gentleman. He was very particular in extending courtesies to the persons calling on him. He also expected similar treatment when he went on official visit to the clients’ places. We had a sick unit under our nursing programme called Paharimata Iron works Pvt Ltd. A senior gentleman called Nopani had taken over the unit and was trying to revive it. Nopani was a super rich thorough gentleman and was related to the prestigious Birla family. Nayak visited the unit once and Mr.Nopani was personally present at the unit at that time.

On returning from the unit Nayak told us that he found the working of the unit satisfactory. However, as regards the treatment meted out to him at the unit, he told us that Nopani literally stood by his name! On our request to elaborate, he told us that he was offered “no paani” (not even water) during the visit!
------- (To be continued)
A V Krishnamurthy

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