MUMBAI:
SBI chairman
Rajnish Kumar said risks in
telecom sector have ebbed considerably from a few months ago. He said that although banks have got burnt in their exposure to telecom, SBI had the capacity to absorb any losses.
“Everyone was betting on the telecom and everyone got burnt. We have also lost money in telecom. Right now, the risk is much less than what it was looking a few months back,” said Kumar. According to Kumar, although SBI had a large exposure, the bank had taken necessary risk-management measures. He was speaking at the India Economic Conclave organised by
Times Network
in Mumbai.
Kumar’s statement comes at a time when banks are struggling with a resolution following the default by Reliance Communications and smaller telcos. There is also concern over lenders’ exposure to Vodafone Idea, which has a debt of nearly Rs 1 lakh crore.
The loss-making telco had said that its ability to continue as a going concern was in doubt following a Supreme Court order that resulted in a Rs 50,922-crore loss for the quarter ended September 2019. Since then, the government has granted relief on payment of future dues and also telcos have come to an agreement to hike tariffs and reduce bleeding.
Admitting that SBI might not have performed that well in delivering value to shareholders, Kumar said that globally when it came to banks, attention was shifting from delivering value to ‘stakeholders’ rather than merely shareholders. He said that when this happens in India, SBI would top the list of companies providing value.
Kumar said that SBI, despite its size, had a robust decision-making process and an ability to change. “Today, SBI in a short period has emerged leader in digital. This means we are capable of change and managing the change well, despite constraints,” said Kumar.
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