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ICICI Bank seeks to soothe nerves at today's meeting

By Anirudh Laskar & Abhijit Lele in Mumbai
October 13, 2008 09:15 IST
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It is mission damage control and ICICI Bank is pulling out all the stops. Weighed down by persistent rumours over its health, the bank's top management will meet senior employees on Monday to reassure them about their future.

The meeting will also discuss ways to dispel doubts among investors and depositors over the bank's capitalisation and stability.

With over 27 million customers and hundreds of thousands of investors, the bank should be worried. It has been in the news for all the wrong reasons. Comforting voices from the finance ministry and the Reserve Bank of India have not helped matters.

The meeting on Monday, when the stock market re-opens after another weekend carnage overseas, is just one of many reputation-control steps the bank is taking. A day after its stock fell a staggering 20 per cent, it sent an SMS to account holders, asking them not to "believe baseless rumours" as the bank was well-capitalised. Some of its ATMs have reassuring quotes by the finance minister and RBI governor pasted on the walls, and are stocking 20 per cent more cash than usual.

A spokesperson said the bank was using all forms of communication to regain the trust of its customers. According to reports, customers have been queuing up at ATMs in Hyderabad and Mumbai.

Rumours about ICICI Bank's international exposure to troubled outfits, bad credit portfolio, and even a cartel of short-sellers working against it have been floating in the air.

For the quarter ended June 30, the savings account deposits of ICICI Bank rose by about 35 per cent to Rs 43,465 crore (RS 434.65 billion) from Rs 32,121 crore (Rs 321.21 billion) in the corresponding quarter last year. The bank has over 1,388 branches and 4,233 ATMs in India.

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Anirudh Laskar & Abhijit Lele in Mumbai
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