Vikramaditya Singh Khichi, Executive Director at Bank of Baroda, talks about the bank’s ambitious plans and on-ground activities to boost its wealth management business:
Mehul Dani: How is the Bank of Baroda re-defining the value proposition for the client’s post amalgamation? What are you doing differently?
Vikramaditya Singh Khichi: Indian economy is undergoing structural changes and is bound to grow at a good pace in the time to come, notwithstanding the slowdown due to the pandemic. Adaptability is one of the key strengths of our bank and we have proactively changed our strategy to meet the demands of every situation. Besides, it is always our endeavor to keep expanding the range of our services. We are leveraging robust technology to upgrade the quality of services to our clients with value addition.
Amalgamation has opened opportunities for us to further expand the client base and to cater to their diverse needs. Our approach is now more holistic. We are future-ready and well equipped to efficiently manage the wealth created by our clients and assist them to grow their wealth through our bouquet of products like PMS, AIF, MF, PE, and traditional banking products. We have, therefore, revamped our wealth management business model to benchmark it with the best-in-class. Our fee income from the distribution of investment and insurance products has grown 5X in the last 5 years and we wish to keep up the momentum.
What measures has the bank taken for leveraging the growing wealth management space?
We have embarked upon a transformation journey – BOB NOWW focuses on exploring New Ways of Working. To give wings to our plan, we have done a bit of restructuring in terms of people, products, and processes. For our wealth management vertical, we have taken strategic steps to set up a strong team headed by a highly experienced and expert professional who would steer this wealth piece and provide the right perspective.
We have segregated the wealth distribution model into 2 parts – a cross-sell model, more focused on leveraging walk-in customers and business through digital modes. Another one is ‘Baroda Radiance’, which is a privileged, relationship manager-based business model, wherein a dedicated RM will assist clients in all banking and investment needs.
To meet the aspirations of the clients, we have revamped our Baroda Radiance model, and launched Radiance 2.0, by incorporating, concierge services, complimentary airport lounges, complimentary golf program, privileged offerings, and discounts through leading global card service providers, preferred pricing on banking products, etc.
To make investing through mobile & net banking a seamless experience, we are upgrading the technology to give them a wow experience. At branches, we have an investment booking platform integrated with RTAs, CVL KRAs at the back end to push details of investments in paperless mode. Broadly, the bank will focus on distribution whereas our subsidiary BOB CAPs will focus on advisory-based business.
Lateral hiring from the industry is an interesting phenomenon. How do you see it?
After having Somwanshi at the helm for steering wealth business, we have initiated a reasonably big hiring plan for recruiting 450 plus RMs and 50 plus resources as territory heads/group heads to strengthen the existing team and cater to HNIs. As these resources are laterally hired, they would be ready for meeting the client’s banking or investment requirements from day one. The new hiring will also expand our distribution across the geography.
Last year, we hired 650 plus resources at entry-level positions and deployed them at potential branches. Our plan seems to have paid dividends as this year, we managed to register around 60% YoY growth as of August 2021 in fee income from MF and insurance, despite the covid disruption. We plan to keep hiring at regular intervals, based on an assessment of business potential, for the growth of wealth business.
Recently Bank of Baroda garnered Rs 10 billion in Baroda Business Cycle Fund. Can you share some light on it, because being a PSU bank, such mobilization in MF is no mean task?
This is an outcome of our transformation project and restructuring initiatives for a focused approach to various business segments. We tried to reach out to our customers through various touchpoints, educated and trained our employees about the product, and opened RM Hubs exclusively for Radiance Relationship Managers at 28 locations.
We hope to grow wealth revenue by 5X in the next 2 years. Given our massive focus on training the people and reaching out to a large number of customers through our wide network of branches pan-India, we are confident of emerging as a formidable player in the wealth management arena within a short span of time.
