At SBI, India's biggest bank, a new chairman to be anointed this week

Incumbent Dinesh Kumar Khara retires on 28 August and the next chairman will take charge the same day. Photo: Pradeep Gaur/Mint
Incumbent Dinesh Kumar Khara retires on 28 August and the next chairman will take charge the same day. Photo: Pradeep Gaur/Mint


  • The front runners for the post are State Bank of India’s three managing directors—C.S. Setty, Ashwini Kumar Tewari and Vinay M. Tonse

Mumbai: The country's biggest bank will soon know who will walk into the 18th floor corner room of its Mumbai headquarters.

The Financial Services Institutions Bureau (FSIB), an autonomous body under the central government, will conduct interviews on 21 May to recommend a candidate for the chairman's post, two persons aware of the matter said.

The final decision is likely to be known the same day, the first person added on condition of anonymity.

Incumbent Dinesh Kumar Khara retires on 28 August and the next chairman will take charge the same day.

The front runners for the post are State Bank of India’s three managing directors—C.S. Setty, Ashwini Kumar Tewari and Vinay M. Tonse. Alok Kumar Choudhary, the fourth managing director, is set to retire end of June.

“All three candidates are top class talent, who will be able to provide stability to SBI," a former SBI chairman said on condition of anonymity. “Whoever becomes the chairman, will be good for the bank."

The FSIB, headed by Bhanu Pratap Sharma, former secretary of Department of Personnel and Training (DoPT), is tasked with the responsibility of appointing senior executives to public sector financial institutions.

Email to Sharma and text messages to Setty, Tewari and Tonse remained unanswered till press time.

Pointing out that Khara’s successor inherits a strong franchise, Asutosh Mishra, head, institutional equities research, Ashika Stock Broking, said that the key challenge will be maintaining growth without compromising the quality of the loan book.

“It's akin to driving a truck at high speed without making major mistakes," he said. “Resource mobilization will be another significant challenge, as changing Indian household saving habits is changing and thus will require innovative strategies to support growth while maintaining profitability."

The veteran banker

The senior most among the three candidates is Setty, who has spent nearly 36 years with SBI, overseeing almost all the important verticals. He oversaw the 1.49 trillion stressed assets portfolio at the peak of the bad loan cycle in 2018, when Rajnish Kumar was chairman.

After he was elevated to the role of managing director in January 2020, Setty has overseen several portfolios including retail, digital banking, and global markets including treasury, international markets and technology. Among the positions he served was as head of loan syndications at SBI’s New York branch.

Also read: SBI: A balance of performance and valuation

Currently, he is also part of various committees set up by the Department of Financial Services on financial inclusion, small business banking and EASE (enhanced access & service excellence) reforms for PSU banks.

His peers describe Setty to be a man of ideas, who is always thinking of what new he can do for the bank.

The corporate banker

At 57, Tewari is the youngest of the three; he joined the bank as a probationary officer in 1991.

Tewari, too, has handled various assignments both within India and abroad. He is currently heading corporate banking and subsidiaries. As the MD, he has also handed risk, compliance, stressed assets, International Banking and IT.

Prior to becoming MD at SBI, he served as MD & CEO of SBI Card from August 2020 to January 2021, where he oversaw key partnerships with GPay, PayTM, BPCL, and also steered the company through the immediate aftermath of the Covid period.

He was the Country Head of the US Operations from April 2017 to July 2020 and prior to that Regional Head of East Asia operations at SBI.

His peers praise him for his skill at handling government agencies and regulators.

The latest MD at SBI

Tonse is the latest to take charge as MD in November 2023. He looks after retail banking, after his predecessor J. Swaminathan was appointed as deputy governor of the RBI.

A native of Udupi town in Karnataka, Tonse joined the bank as a probationary officer in 1988. His father Muralidhar Rao retired as the director of small savings and lottery department in the Karnataka government. During his college days, he won medals in archery in state mini-Olympics and represented Karnataka at the national level.

Tonse's peers describe him as a soft person, with strong team-building capability. Tonse has worked as staff college trainer in Hyderabad and Bengaluru. He also worked as the MD & CEO of SBI Mutual Funds from August 2020 to December 2022.

Leaving behind a strong legacy

The appointment of a new chairman comes at a time when SBI’s financial performance has vastly improved.

“Khara's main achievement is that he has been able to improve the financial performance of the bank. Since he took charge as chairman, the share price has zoomed from 250 levels to 820 per share," said a former senior SBI official. “While he may not have been perceived to done anything innovative, Khara did a commendable job in these uncertain times."

The bank posted record net profit of 20,698 crore at the end of March 2024. Asset quality is the best in nine years, with net non-performing assets as a percentage of total assets coming in at 0.57% of total assets, compared to 1.23% when Khara took charge. SBI's bad loan portfolio stood at 84,276 crore at the end of March 2024.

“We used to think SBI's sheer size would prevent it from outpacing key industry benchmarks," Mishra said. “However, Khara's four-year term has proven many of us in the investment world wrong. He not only successfully navigated the bank through the difficult post-covid period but also positioned it to participate in the India growth story. The numbers confirm this: under his tenure, ROA and ROE improved to 1.04% and 20.3% respectively, compared to 0.48% and 9.94% in March 2021."

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