Nobody serves up surprises better than Kotak Mahindra Bank and its promoter Uday Kotak. The appointment of Ashok Vaswani, as MD and CEO of Kotak Mahindra Bank, who is set to take charge before January 1, 2024, was one such googly which very few people saw coming. .

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Vaswani enters the bank at a time when most people within the bank and industry presumed that either one of Kotak’s group management council members, KVS Manian or Shanti Ekambaram, would take over the baton from Dipak Gupta, the interim CEO.

So, will the insiders take this decision kindly?

Illustrious background

“Vaswani is someone who, with absolute precision, knows the direction of the wind and he’s never been on the wrong side,” said a former colleague at Citibank, where he spent the first eight years of his career. “That was also the period of the rise and rise of corporate banking in the West and he didn’t miss any opportunity that came his way. He’s the perfect corporate banker,” said another former colleague at Citi.

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Towards 2004–05, he started investing his career in Citi’s consumer banking business. In 2007, he was among the top leadership exodus, when Citigroup was revamping its consumer banking business globally, a year ahead of the Lehman crisis. Known to be close to Ajay Banga, who then headed Citi’s international consumer division, Vaswani took a three-year break from banking. His association with Barclays started in February 2010 as CEO of the cards business in Europe.

With leadership roles in retail, personal and corporate banking, he was elevated as CEO of Barclays, UK, in March 2016 and subsequently as chief digital officer in November 2021.

After helming the role for about nine months, Vaswani moved out of an active banking career. He’s currently the President at Pagaya, a New York-based company focused on artificial intelligence in the financial services sector, and is said to be one of the most influential names in the global banking arena.

People who have worked with Vaswani call him a man for all seasons. “You just have to give him a problem to solve and he’ll get it done,” said another former colleague of Vaswani. But what caught even his friends by surprise was his plans to return to India.

“He is very clued in about the Indian market, but none of us had an idea that he’d want to take the top job at the homebred Kotak Mahindra Bank,” said the banker quoted above.

Filling big shoes

The stock market was also taken aback. On Monday, Kotak Mahindra Bank’s stock fell over 1.5 per cent reacting to Vaswani’s appointment. “The market was expecting an internal candidate, an external candidate got appointed…we need to see how he fits into the Indian banking environment, need to see whether there are senior management exits or any internal flux…many moving variables here,” says Suresh Ganapathy of Macquarie Capital.

That said, there are few similarities between Uday Kotak and Ashok Vaswani.

Both are perhaps the same age and alumni of Mumbai’s famous Sydenham College. They share their passion for cricket.

But as bankers will there be similarities? “Foreign bankers are known to be very competitive and cut-throat and on top of their game always,” said a CEO of a private bank who has worked with Vaswani. “At Kotak, his appointment could set the cat among the pigeons”.

Adapting to Vaswani

But it needs to be seen if Kotak loyalists can adapt to Vaswani. Kotak Bank’s senior leadership are known to be loyalists and career Kotak employees.  “Everyone gets treated like family, and despite the competition we have each other’s back,” said a former employee of the bank.

The question most analysts are asking is whether Vaswani would adapt to Kotak.

Usually, an outsider CEO brings along their trusted people and, more importantly, an outsider gets appointed when the ways of working need to be changed. Axis Bank is the classic example.

While Uday Kotak calls Vaswani’s decision a ‘ghar-wapsi’ by a global banker, will Kotak Mahindra Bank be a happy home is something only time will reveal.