Are PSU bank heads feudal lords?4 min read . Updated: 29 May 2011, 09:07 PM IST
Are PSU bank heads feudal lords?
Are PSU bank heads feudal lords?
What does the chairman of a public sector bank do if he can’t get into the car that is supposed to ferry him to the bank’s guest house from an airport? He will catch a taxi. Right? Well, partially. Indeed, he will catch a taxi, but he will also suspend the senior executive who is at the airport to receive him.
I am not cooking up this story. It happened in Mumbai in the third week of May. On a Thursday evening, the chairman of a public sector bank took a flight from a southern city to Mumbai. The liaison officer of the bank was at the airport to receive him along with a general manager who heads the bank’s Mumbai operations. The liaison officer went inside the airport to greet his chairman and the general manager preferred to wait outside while the airconditioner was on to keep the car cool on a hot and humid evening. While the chairman’s suitcase was being loaded in the car’s boot by the driver, the doors got locked with the key in the ignition.
As it was not possible to get another office car at that time (it was well past 9.30pm), the liaison officer first tried to arrange for a “cool cab", but the queue at the airport counter was long. Finally, he hailed a Meru cab to take the chairman to the bank’s guest house in Cuffe Parade in south Mumbai, but by that time, the chairman lost a precious 45 minutes and his cool. The delivery of the suitcase at 1am to the guest house and the apology of the general manager next morning (he even touched the chairman’s feet, I am told) did cut no ice with the chairman, who suspended him on Friday.
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The suspension order was revoked after a national daily narrated the story graphically last week. I am not naming the bank and its chairman as more than individuals; this incident is probably symbolic of the culture in public sector banks that account for roughly 70% of the Indian banking industry. The chiefs here work under a lot of stress as they are not only answerable to their board, but also to officials of the ministry of finance and politicians, and they are not paid well, but when it comes to managing the bank, at least some of them behave like feudal lords.
Using guest houses for personal purposes such as accommodating relatives when their children get married is not uncommon for the bosses. In the executive lunch room of one public sector bank, I have seen a particular table being reserved for the chairman where no one is allowed to sit. In yet another bank’s lunch room, I have seen the chairman eating green chillies till beads of sweat trickled down his bald head and somebody wipes it with a white towel before serving dessert.
The suspension of a senior executive for being stranded at an airport for about an hour may be a little too much, but a few years back another senior executive of another bank got transferred to the North-East—traditionally seen as a punishment posting for a banker—after a guest house elevator got stuck with both the chairman and his wife inside. To pacify his wife, who was very upset, the chairman had to leave the guest house immediately and at night shifted to the guest house of another organization that he had previously headed. The general manager was handed his transfer letter the next morning.
How do private sector bankers deal with such situations? Differently. This is not because they get higher compensation packages and have more patience and less stress in work. Most private banks have facility management divisions that look after logistics and other related issues, and normally the senior managers do not get involved in arranging the chief executive’s vehicle at the airport or food at the guest house. Only when it comes to fixing appointments in the finance ministry or the regulator in Mumbai do senior managers get involved. They attend such meetings with the chief executives, take notes, and oversee the follow-up actions. But greeting the boss at the airport, and arranging vehicles and flowers at the guest house are the responsibility of the facility management division.
I spoke to a Mumbai-based psychiatrist to understand why such things happen in the public sector banking industry. Are the bosses a pampered lot? Is it outright feudalism? The psychiatrist—she doesn’t want to be named—blames both the culture as well as individuals for such incidents. According to her, one should not generalize such problems and instead focus on an individual’s behaviour. After all, everybody does not suffer from road rage. She also wants to know why the general manager went to the airport to receive his chairman. I am told the rulebook does not say that a senior executive needs to be present at the airport, but by tradition most go and there are bosses who actively discourage this practice as it’s a sheer waste of time that can be better utilized for soliciting business or recovering a bad asset.
After discussing these episodes with the psychiatrist, I am feeling a bit relieved, as such incidents could be exceptions and not norms. Meanwhile, here is a piece of advice to the reinstated general manager. Next time he goes to receive the chairman at the airport, he can carry a tennis ball with a hole drilled in it. Apparently, if you place the tennis ball against the outside lock where you would normally insert your key and push as hard as you can, the air pressure will pop the inside lock open. Needless to say, I read this on the Internet and have not tried it yet.
Tamal Bandyopadhyay keeps a close eye on all things banking from his perch as Mint’s deputy managing editor in Mumbai. Please email your comments to firstname.lastname@example.org