Tamilnad Mercantile Bank (TMB), based in Tamil Nadu’s Thoothukudi, is a bank that MD & CEO S. Krishnan has been following since his youth. Having spent most of his banking career with lenders like Syndicate Bank, Canara Bank, and Punjab & Sind Bank, he always admired this modest private bank. “The client-centric approach and customer service is the bank’s main strength,” says the MD & CEO, who is credited with the turnaround of Punjab & Sind Bank.
After taking charge in September 2022, Krishnan wants to build on TMB’s core strength by scaling up its relationship with customers. “I will be focussing on that segment as it has a lot of potential,” he says. A household name in Tamil Nadu, TMB has more than 5 million active customers and 509 branches.
2022 was a landmark year for the bank as it went public at Rs 510 (the issue price was Rs 500-525 per share). It was trading at Rs 483 on January 5. According to the BT–KPMG Best Banks and Fintechs Survey 2021-22, TMB—with a focus on retail, agri and MSME segments (or RAM segments)—has emerged as the Best Small Indian Bank.
The bank is also deeply associated with the business community, with a stronghold in the MSME sector. “We are working on automating the processes in the MSME segment,” he says. Its growth is amply reflected in its financials, where its net profit increased by 36 per cent to Rs 821.91 crore in FY22. It reported deposits of Rs 44,930 crore and advances of Rs 33,748.17 crore in FY22. Its net interest income grew by 18 per cent to Rs 1,032.57 crore in H1FY23, while net profit grew 26.63 per cent to Rs 496.51 crore in H1FY23.
The bank has a well-diversified business model around the RAM segments, and the MD & CEO now wants to diversify its loan book by betting on corporate banking. “RAM is definitely a better distribution of risk. I have reached a level of 88 per cent. Now… I am open to corporate banking on a selective basis.” In terms of challenges, the bank has to deal with the perception issue associated with old private sector banks as they had faced governance and asset quality issues earlier, making the markets sceptical about trusting them. But Krishnan says that with a professional board drawing on experience from diverse sectors, the bank is in good hands. “We are growing in a very calculated manner by understanding the business climate,” he says.
@teena_kaushal
