RBI Governor's  Joke  Shows  Pratip Chaudhuri and KC Chakrabarty The Real Place They Deserved

by

Rajesh Goyal   

Today's (05/09/2012)  newspapers are full of the joke cut by RBI Governor on the issue of abolition of CRR.   Headlines in different newspapers have created a flutter among the bankers.    Economics Times headlines read "A Reserve Ratio Evokes Unreserved Laughter - Mint St in splits as RBI Governor takes a dig at his deputy Chakrabarty and SBI Chief Chaudhuri".   Times of India reads "Subbarao CRRacks a joke, bank stocks go up on news flash".   Rediff's comments were more sensible "Subbarao's Laughter Therapy on CRR Row".  of the people must have taken the same lightly.

• On 28th August, 2012, I have written my views under the heading Abolish CRR Issue  -  RBI DG Snubs  SBI Chief  - Need to Observe Restraint

In the above article I have expressed my views clearly that there is a need for restraint by Mr Chakrabarty as well as Mr Chaudhuri and had hoped that both of them will not issue statements in the public domain. 

However, Mr Chaudhuri could not control his ego and again issued a statement asking for "National Debate on CRR".   I think it was totally unwarranted at that stage.   A public statement like that was not expected from a senior banker like Mr Chaudhuri, who is heading the largest bank in India.   The statement was like an open defiance of the regulator.   Instead of going to press, Mr Chaudhuri could have sent his views to RBI by a letter or placed the facts in a meeting. 

Now just imagine that if a General Manager of SBI goes to press and says that SBI's policy of CDR (Restructuring of Loans)  needs a national debate.   How will Mr Chaudhuri feel.   I am sure that GM will be fired and will be given a remote  post on the same day itself.  As and when a middle level banker behaves in such a manner, he is snubbed in the meeting with remarks like "Don't behave like clerk".   Mr Chaudhri's remarks were on similar lines.

The joke by Mr Subbarao, I consider, was timely and has snubbed both top bankers and showed them the place they really deserve for such petty fighting in the public domain.   I hope in future both will show more grace at public forums.   I think, had Mr Subbarao not intervened in the manner he did, both of them would have clashed on this issue for a long time.   

I would like to share one similar instance with my readers.   This can be a great lesson to all bankers - specially young bankers who are at learning stage.   Now everybody knows about Mr Chakrabarty's nature and his use of high pitch when he is annoyed with  remarks or faults by his juniors.   I think it was mid 2009, when a meeting was going on in the Board room of the bank and Mr Chakrabarty was heading the meeting as CMD of that bank.    It was the time, newspaper reports were clearly indicating his elevation to be DG of RBI.   The meeting was being attended by EDs, about 10 GMs and some middle level officers like me.    On some issue (I would not like to disclose here the details of the issue),  Mr Chakrabarty became extremely angry with one GM as he felt the department has not taken sufficient steps to meet certain requirements.   There was firing at high pitch all around.   In the surcharged atmosphere nobody dared to speak  or give explanation.   Suddenly, he thundered 'Had I been in RBI, I would have asked for closure of  this bank".   The whole house was shell shocked for his ultimatum as each one of us felt that lapse is not that big which will call intervention of RBI.   There was pin drop silence for next two to three minutes.   Nobody was ready to say anything as it was certain, anybody who will open his mouth at that moment would have got the whole firing.   Ultimately, one of the senior most  GMs, who was widely respected for his knowledge and uprightness stepped in to break the logjam by cracking a joke.    He told "Sir, we are now worried for next month,  as when you get elevated in few days,  we will be jobless as you may order closure of this bank'.   The whole house burst into laughter and issue was resolved with instructions to do the needful immediately.    That is the power of a timely joke.  

I like the maturity of Mr Subbarao in defusing this issue by cracking a joke which also showed the right place to both of them.    I hope now these two giants of Indian banking industry will learn a lesson and adhere to the advise of  RBI Governor and  this little known ex-banker.