IDFC First Bank CEO gifts shares worth ₹4 crore to driver, staff

At a time when companies are offering ESOPs to their employees, the managing director and chief executive officer at IDFC First Bank has gifted shares worth about ₹4 crore to his trainer, househelp and driver among others to help them purchase homes.

V. Vaidyanathan, MD & CEO at IDFC First Bank, gifted 9 lakh equity shares of the bank held by him to five individuals including his driver, trainer and househelp, according to an exchange filing.

"The recipients are personal relationships and not related to him in any manner under the definition of related parties of the Companies Act or SEBI Regulations," the filing says.

Vaidyanathan's trainer Ramesh Raju received 3 lakh shares worth ₹1.3 crore as a gift to purchase a house. Pranjal Narvekar, a househelp of the lender's CEO, and Algarsamy C Munapar, the driver, got 2 lakh shares each worth about ₹86 lakh.

Santosh Jogale, another househelp of Vaidyanathan, received 1 lakh shares worth ₹43 lakh. Deepak Pathare, a member of Vaidyanathan's office support staff, also received 1 lakh shares.

In addition, the lender says Rukmani Social Welfare Trust has disposed of 2 lakh equity shares to support social activities.

"Thus, total shares disposed for gifts and social activities is 11,00,000 equity shares of IDFC First Bank Limited, and it is submitted as part of these disclosures, that there are no direct or indirect benefits derived by V. Vaidyanathan from these transactions," the bank says.

An alumnus of Birla Institute of Technology and Harvard Business School, Vaidyanathan is credited with building ICICI Bank’s retail, SME, and rural franchises.

The seasoned banker has over two decades of experience in financial services in India. He worked with Citibank Consumer Banking from 1990-2000, then set up ICICI Group's retail banking from 2000-2009 since its inception. At 38, he was appointed to the Board of ICICI Bank in 2006. In 2009, he became the MD and CEO of ICICI Prudential Life Insurance Company in India.

In 2010, Vaidyanathan left ICICI Group for an entrepreneurial opportunity to acquire an NBFC with an idea to convert it to a bank. In order to secure a commercial banking license, he agreed to merge Capital First with IDFC Bank in December 2018 and took over as the MD and CEO of the merged entity.

Since then, between December 2018 and December 2020, the bank has increased its retail loan book from 13.16% pre-merger to over 60.35% of the total funded assets, increased net interest margin from 1.68% pre-merger to 4.65%, and increased CASA from 8.68% to 48.31%. The lender claims it has over 10 million customers and a loan book of more than ₹1 lakh crore.