Mumbai-based NBFC, Magma Fincorp, has announced a series of leadership changes following the Poonawala-controlled Rising Sun Holdings acquiring controlling stake through an equity infusion of Rs 3,456 crore in May 2021. The Board has appointed Adar Poonawalla as the Chairman of the Company. The Company has also appointed Abhay Bhutada as the Managing Director. Vijay Deshwal, a seasoned banker with a track record of over two decades, will take charge as CEO at Magma Fincorp from the first week of July. He will also be the Group CEO of Poonawalla Group’s financial services business.
Deshwal is currently a business head at ICICI Bank, responsible for its fast growing services sector, including new age businesses. He is also responsible for driving the liability strategy for the corporate ecosystem at the Bank. Having handled pan-India financial institutions including NBFCs for over six years, Deshwal has vast understanding of various asset classes and the cyclicality of these businesses. He had previously headed debt syndication business for ICICI Bank for over five years.
These changes reflect the Company's transition into the next phase of growth and the ongoing commitment to achieving the highest standards of corporate governance. The balance sheet has been strengthened significantly through the equity infusion, with the Tier-1 capital adequacy ratio standing at 66.8%, and leverage at 1.3 times as on 15 May 2021. The Company has created capital buffers and opted for aggressive write off policies in line with a Bank structure.
The Company is going to augment the leadership team with the appointment of highly qualified and experienced professionals from reputed financial institutions for various senior management positions, set to join by Q2 FY22. As the second wave of Covid-19 is subsiding, the new management is expected to drive business acceleration. The rebranding of the Company as a Poonawalla Group firm is underway. The Company’s cost of funds is expected to fall in line with the industry best, along with resultant improvement in credit rating and progress towards resilience under the Poonawalla brand.
“I am excited to take over as the Managing Director of Magma Fincorp and embark on a new journey of Magma 2.0. I see enormous potential in the financial services space in India and in line with our vision, we at Magma will serve the needs and dreams of the nation. At the outset, we have outlined the core strategic pillars of Magma 2.0, laying out a clear and focused direction for the Company: Professionally-run organization under a new leadership team fully supported by the existing leadership, Capitalize benefits from large capital base and stronger parentage, Realignment of the product and geographic focus, Early recognition and tackling of asset quality challenges with accelerated write-offs and buffer provisioning, Robust ALM profile, and Best in class risk management, technology and data analytics,” says Abhay Bhutada, MD, Magma Fincorp.
