“Based on our application made to the Reserve Bank of India (RBI) on May 06, 2024, for its approval for the new managing director & chief executive officer of the bank, the RBI has, vide its letter dated July 22, 2024, approved the appointment of Mr. Krishnan Venkat Subramanian as the managing director & chief executive officer of the bank,” the bank said in a filing to the exchanges.
Krishnan Venkat Subramanian has been appointed as the MD & CEO for a period of three years and his term will begin from September 23, 2024 after the expiry of the term of the current Managing Director and CEO.Also read: Budget bombshells: 3 nightmares that stock investors fear from Nirmala Sitharaman’s speech
Prior to this, Subramanian was the Joint Managing Director of Kotak Mahindra Bank till April 30, 2024, spearheading corporate banking, commercial banking, private banking and asset reconstruction business and was responsible for building a high quality integrated and profitable franchise across these businesses.
Here is what brokerages say on the update:
Nomura: Buy | Target price: Rs 195
Nomura views this development as positive, as it also brings an end to the uncertainty around management succession. Mr. Manian has a strong banking pedigree and diverse experience across financial services and his leadership can potentially aid the bank’s growth and profitability outlook over the medium term. Federal Bank continues to be Nomura’s top mid-cap banking idea.
Kotak Securities: Buy| Target price: Rs 190
Kotak Securities has maintained a buy view on Federal Bank with target price of Rs 190.
The appointment of Subramanian is likely to be a positive development for the bank which removes a key uncertainty of transition. Manian has the requisite experience across all lending and non-lending activities and Kotak Securities does not think there would be a shift in strategy post the change in leadership. The bank has been fairly conservative in its own underwriting.
The domestic brokerage firm doesn’t see a reason for Manian to change the direction at which the bank is looking to build its asset book and thinks the current leadership has the requisite talent to execute and scale the business profitably.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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