THE BANKERS WHO SAW TOMORROW

THE MAIDEN FORTUNE INDIA-GRANT THORNTON BHARAT STUDY ON INDIA'S BANKS SHOWS WHAT IT TAKES TO WIN IN BANKING SWEEPSTAKES.

- V. Keshavdev

BANKING IS A VERY GOOD business unless you do dumb things -Warren Buffett

The Sage of Omaha quite succinctly describes the business of banking in the context of his investment in Wells Fargo, the US-based diversified financial services conglomerate. Unfortunately, the world's fifth-richest person had to dump his over three-decade-old investment last year due to the lender's poor handling of what Buffett described a "dumb" incentive system that snowballed into a scandal.

The turn of events clearly goes to show that while banking appears extraordinarily simple where a bank just needs to source funds cheap and create a strong asset franchise, it's tough for bankers to be good at their game at a stretch. Yet, the reality is that every business has a bunch of outliers who continue to be good at what they do - day in, day out - especially in a nation that aspires to be a $5 a trillion powerhouse by 2026.

That the banking sector is the lifeline of India's economy can be gauged from the fact that there are 12 public sector banks, 21 private sector banks, 45 foreign banks, 43 regional rural banks, 1,470 urban cooperative banks and 96,000 rural cooperative banks, besides cooperative credit institutions. The financial architecture is the engine behind the $1.55 trillion bank credit and $1.54 trillion nonfood credit flowing in the system (as of Februrary 2022).