Axis Bank's Arjun Chowdhury resigns; Gambhir elevated to executive director

Business Standard

18-07-2025

Axis Bank, India's third-largest private sector lender, on Friday informed exchanges that Arjun Chowdhury, Group Executive overseeing affluent banking, cards, payments, and retail lending, has resigned to pursue an entrepreneurial opportunity.
Additionally, the bank has elevated Neeraj Gambhir, currently Group Executive in charge of treasury, markets, and wholesale banking products, to the position of Whole-Time Director, designated as 'Executive Director,' effective August 4.
In his resignation letter, Chowdhury said, '… I have decided to pursue an entrepreneurial path outside Axis.'
Chowdhury joined Axis Bank after the acquisition of Citibank India's consumer business on March 1, 2023. He had been with Citibank for close to 30 years, and prior to the merger, he was the country head (consumer bank) of Citibank India.
Regarding Gambhir's appointment, the bank said he has been appointed for a period of three years from the effective date of his appointment and is subject to the approval of the bank's shareholders and the Reserve Bank of India (RBI).
Gambhir, who joined the private-sector lender in May 2020, was MD with Nomura India before Axis. Previously, he was MD with Lehman Brothers, India. Gambhir has also worked with ICICI Bank.
Gambhir's appointment comes in the wake of Rajiv Anand, deputy MD, Axis Bank retiring in August.
Axis Bank's senior leadership has seen some churn lately. In June last year, Sumit Bali, group executive overseeing retail lending, quit and later joined Yes Bank.
The bank's stock took a beating on Friday, with shares of the bank plummeting over 5 per cent on the BSE, after the bank reported weak earnings, due to significantly higher slippages.
The bank reported a 4 per cent year-on-year (YoY) decline in net profit to Rs 5,806 crore for the April–June quarter of FY26 (Q1FY26), due to a significant rise in slippages. It reported fresh slippages of Rs 8,200 crore, up 71 per cent YoY and sequentially in Q1FY26.
'Credit cost at 140bps in Q1FY26 (vs 70bps in FY25) was driven by a change in accounting policy towards NPA recognition for certain cash credit, overdraft, and one-time settlement accounts. This had an impact of ~100bps on slippages and ~30bps on credit costs,' said Macquarie Research in a report, adding that even after adjusting for this accounting change, credit costs of 110bps were well above those of private peers.
The bank's management highlighted that it expects no other policy changes and that the current change is not driven by regulatory diktat.
The bank's loan and deposit growth was muted in Q1, raising concerns about the bank's growth plans going forward.
'Axis Bank targets loan growth 300bps higher than industry levels, which appears to be a challenging task given current trends. Muted deposit growth, in comparison to private peers, will also restrict loan growth,' said Motilal Oswal in a report, adding that the bank's net interest margin (NIM) is likely to remain under pressure once the impact of the remaining 75bps rate cut flows in Q3FY26. 'Sustained moderation in retail loan growth could also hamper NIMs, while higher credit costs imply downside risk to our return on assets (ROA) estimates,' the report said.
'The discussion hereon will be centred on asset quality outcomes. It is difficult to ascertain the eventual impact, but the direction and drift may improve hereon. Movement of net slippages and credit cost will be the single-most important factor in the near term to rebuild investor confidence and core performance (NIMs may see a higher impact in Q2), with Axis Bank's ability to retrace and sustain that growth,' Elara Securities said in a note.