In 2010, Vembu Vaidyanathan leaves a top job at ICICI Bank, smitten with an idea that he could start a bank de novo with ownership stakes.
So how does he get a bank license, raise the funds and build the bank?
Time for a thread 🧵👇
#fintwit
So how does he get a bank license, raise the funds and build the bank?
Time for a thread 🧵👇
#fintwit
Vaidyanathan was an alumnus of Birla Institute of Technology, Mesra.
Post that, he completed his Advanced Management Program from Harvard Business School, Boston.
Vaidyanathan began his career at @Citibank.
Post that, he completed his Advanced Management Program from Harvard Business School, Boston.
Vaidyanathan began his career at @Citibank.
In 1999-2000, ICICI decided to foray into Retail lending from Project Lending, and Vaidyanathan joined them to spearhead the Retail businesses.
His responsibility included setting up the businesses including all key functions related to these businesses.
His responsibility included setting up the businesses including all key functions related to these businesses.
He joined ICICI when it was a Domestic Financial Institution (DFI) known for project financing, & the retail business he built helped the transition of ICICI to a Universal Bank.
He was appointed MD and CEO of ICICI Personal Financial Services (PFS) Ltd. at the age of 32.
He was appointed MD and CEO of ICICI Personal Financial Services (PFS) Ltd. at the age of 32.
He built the Retail Lending Business for ICICI since its inception.
In 2002, ICICI Limited merged with its subsidiary @ICICIBank & with ICICI PFS Limited.
Post that, he became the Head of Retail Banking in charge of both Lending & Retail Liabilities in @ICICIBank.
In 2002, ICICI Limited merged with its subsidiary @ICICIBank & with ICICI PFS Limited.
Post that, he became the Head of Retail Banking in charge of both Lending & Retail Liabilities in @ICICIBank.
He grew the retail business to over 1400 bank branches in 800 cities, 25 million customers, a vast CASA & retail deposit base, internet & digital banking, a retail loan book of over Rs. 1.35 trillion in Mortgages, Auto loans, Commercial Vehicles, Credit Cards & Personal Loans.
As an additional responsibility, he also built the ICICI Bank's SME business since 2003, and managed the Rural Banking Business after 2007.
He was appointed Executive Director on the Board of @ICICIBank at the age of 38.
He was appointed Executive Director on the Board of @ICICIBank at the age of 38.
He became the MD & CEO of @ICICIPruLife Insurance Co at 41.
He was also the Chairman of ICICI Home Finance Co. Ltd, & served on the Board of @ICICILombard General Insurance Company, @CIBIL_Official - India's first Credit Bureau, and SMERA- @sidbiofficial's Credit Rating Agency.
He was also the Chairman of ICICI Home Finance Co. Ltd, & served on the Board of @ICICILombard General Insurance Company, @CIBIL_Official - India's first Credit Bureau, and SMERA- @sidbiofficial's Credit Rating Agency.
In 2012, venturing down the entrepreneurial road, he acquired a stake in an existing NBFC.
After much hard work of raising debt brick by brick, and shutting down subsidiaries, he built a proof of concept and pitched to investors.
After much hard work of raising debt brick by brick, and shutting down subsidiaries, he built a proof of concept and pitched to investors.
Vaidyanathan won an equity backing of $159 million from @warburgpincus and completed a management buyout.
And created a new brand entity — Capital First with a new business model.
Today, he is the Executive Chairman and Managing Director of this successful Retail NBFC.
And created a new brand entity — Capital First with a new business model.
Today, he is the Executive Chairman and Managing Director of this successful Retail NBFC.
Vaidyanathan believed that there is a unique opportunity in financing India's 30 million MSMEs and India's emerging middle class, with a differentiated model based on new technology platforms.
As a part of this belief, he exited four legacy businesses- Forex, Broking, Wealth Management and Investment management and instead started retail financing in the company.
The company grew from 9 locations to 222 locations across India within 5 years.
The company grew from 9 locations to 222 locations across India within 5 years.
During this period, he had grown the total loan book from Rs. 9.35 billion to Rs. 149.73 billion, had grown the capital from Rs. 6.90 billion to Rs. 23.63 billion (31 Dec 2015), reduced the NPA from 5.36% to 1% and got the long term credit rating upgraded thrice from A+ to AA+.
Vaidyanathan built the company around a rigorous credit underwriting process, which helps maintain high asset quality.
Only loans that meet the lending norms are disbursed.
An independent collection team then follows up to ensure that the credit health of the loans endures.
Only loans that meet the lending norms are disbursed.
An independent collection team then follows up to ensure that the credit health of the loans endures.
In January 2018, eight years into his adventures, serendipity struck, @IDFCFIRSTBank became available for a merger, and under the agreement, Vaidyanathan would head the combined entity.
In effect, he got the bank license he wanted.
In effect, he got the bank license he wanted.
Today @IDFCFIRSTBank has built a national footprint through the operation of 242 branches.
Out of the 242 branches 133 are in major urban locations & 109 are in rural locations!
Out of the 242 branches 133 are in major urban locations & 109 are in rural locations!
It also has 454 Corporate Business Correspondent (BC) branches, 141 ATMs, 102 asset-servicing branches primarily in the urban areas, 3 Central Processing Centers and 1 Clearing Hub.
@IDFCFIRSTBank has definitely come a long way since it was founded in 2015.
@IDFCFIRSTBank has definitely come a long way since it was founded in 2015.
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