Banker hunt leads NBFCs to headhunters

The draft guidelines for licensing of new banks in the private sector released last week, have set off a flurry of activity among stakeholders seeking to eye a number of candidates with the help of headhunters. Non-banking finance companies (NBFC) have given out mandates to recruiters to look for suitable candidates for the corner offices.

Business groups and enterprises who are seriously looking at a banking foray have also engaged consulting firms for charting out a road map. This involves looking at the existing competitive landscape; emerging opportunities and business focus – corporate, retail and geographical coverage of banks.

Headhunters, whom Business Standard spoke to, said companies have sent out feelers to eligible candidates seeking their interest to join their companies, as and when it takes shape. R Suresh, MD-India, Stanton Chase International, is busy with two new NBFC clients, one from Chennai and the other from Mumbai, to meet their need of C-level executives. "We are working with two large companies which expect to get a banking license. One of them is setting up certain additional functions also. We are involved in the recruitments."

According to Viren H Mehta, director, Ernst & Young, top priority for the NBFCs is to zero in on people who could be part of the top management team. Along with chief executive officer, risk management, operations and treasury, there are other key appointments which would merit attention. "The profile of the leadership team is the most important aspect as it would carry a lot of weight in the Reserve Bank of India's assessment of the company's capability to run the new entity," says Mehta.

For Uday Sodhi, chief executive officer of headhonchos.com, selections at the top and senior management level, will be a long process of evaluation and could take over six months. "Many companies and groups which are interested in setting up banks have approached us. Now they would access our vast and rich data-base on banking sector professionals. Then, they will interact with bankers."

The demand for covering unbanked areas and bringing them under financial inclusion, will help those companies with rural banking experience. Those with experience of setting-up operations or businesses will also be sought after. However, headhunters say there was no dearth of talent in the market which may severely impact dynamics. Advent of new banks will create new openings and people will get a chance to showcase their capabilities. Entry of new banks may also impact compensations, albeit at some point in future.

"Those looking for people will have to structure innovative packages. Those at the receiving end (read banks or financial entities that become target for talent search) will have to employ defensive strategies, including an improvement in pay packages to retain talent," says Sodhi.

"Existing banks, especially foreign and private ones, would take a cue from the emerging competition. This may push compensation packages and rewards for professionals in key functions. The real change would happen once they start feeling the heat. The war to retain and woo talent is not going to be easy," says Mehta.