Karnataka Bank, a century-old private sector lender, is experiencing a comprehensive transformation led by its recently appointed CEO, Srikrishnan H, who assumed the role in May. Srikrishnan, former CEO of Jio Payments Bank, is steering the bank towards becoming a modern, digital-centric institution. His guiding principle for this transformation is “running the bank, growing the bank, and then changing the bank.”
Srikrishnan is initiating a cultural shift within the bank, placing greater emphasis on branch-level sales. He aims to centralize operational processes and expand the sales team at branches. He believes that while the bank’s customers are loyal due to its service quality, the bank must also provide the desired products to prevent customers from seeking alternatives.
To enhance customer retention and acquisition, the bank is focusing on boosting its technological capabilities and computing capacities. It is pursuing comprehensive digitization efforts to acquire customers digitally. Additionally, the bank is in the process of relocating its digital and analytical operations to a dedicated tech hub in Bengaluru spanning 40,000 square feet. The bank is also exploring collaborations with fintech companies for co-lending opportunities to cater to its customer base of 130,000. The board has endorsed this strategy to expedite digital banking growth.
Srikrishnan is revitalizing the bank’s subsidiary, Karnataka Bank Services Ltd, with plans to recruit support staff and manage back office processes and sales support. This initiative aims to reduce the wage bill. The bank is also working on lateral recruitments for critical leadership positions based on market compensation structures.
Srikrishnan envisions changing the bank’s character to become modern and youthful. The bank’s transformation journey is aimed at benefiting the institution as a whole. It’s important to note that part of this transformation was initiated by Srikrishnan’s predecessor, Mahabaleshwara MS, who aimed to turn Karnataka Bank into a digital lender.
Karnataka Bank’s recent financial performance showcases a 22.5% increase in net profit to ₹371 crore in the June quarter compared to ₹114 crore the previous year. Additionally, its gross non-performing loans as a percentage of total loans decreased to 3.7% from 4% sequentially. These positive outcomes reflect the effectiveness of the ongoing transformation efforts.
