Furquan Moharkan, author of The Banker Who Crushed His Diamonds, told us about how he got started on this story, what drew him to the Yes Bank labyrinth, and the experience of writing a story where power dynamics are very much at play.
Take us through your story – how did you start reporting on Yes Bank, and what exactly did you uncover there?
FM: You know, the Yes Bank was always an intriguing thing for me. There was too much of glamour for the organisation for the industry it was. Financial services are usually denoted by trust and dependability. When Yes Bank’s much bigger rivals were playing low profile, it was punching way above its weight. Though, that doesn’t mean glamour and financial services can’t go hand in hand. Also, at times of risk averseness by Indian banks, Yes Bank’s loan book was growing at an astronomical rate – almost seven times the overall industry numbers. But nothing was coming out in the market, as Rana Kapoor has managed to keep a tight lid over his alleged misdeeds. But once he was out in 2019, the skeletons tumbled out of the cupboard – and they tumbled at rate which was probably faster than the loan growth under Rana.
Had it not been for that post-Yes Bank results market crash in April 2019, probably I would not have got the leads for uncovering the rot. But after that crash, many in the street lost their holdings in Yes Bank, and financial set-up was visibly upset with the bank, and things started to come to fore.
Was your experience of writing a book very different from your journalistic writing?
FM: It was quite different. In journalistic writing, due to the dearth of space and word limit constraints, you can’t build a narrative properly. If I have to drive an analogy, I would say, journalism is painting in a sketch book (develops your fundamentals), and writing a book is painting on canvas (helps you express yourself).
Could you tell us, briefly, what happened at Yes Bank?
FM: The Bank under its founder and former CEO had lent recklessly in lieu of higher margins and with risk assessment sent for a toss. These loans were granted to stressed entities – the firms whose repayment capability was questionable. Once these companies started defaulting, the bank was evergreening their loans – granting new loans to repay older loans. But that wasn’t sustainable and bank had to write them off. For that they needed capital, which wasn’t coming their way. On the other hand depositors started withdrawing en masse. Both combined and it led to severe crunch of funds at the bank.
How do people like Rana Kapoor manage to get away (at least to a certain extent for a certain period of time) with orchestrated failures of this kind?
People like Rana Kapoor are blessed people. They are smart and intelligent, but they misuse their gift. They combine their analytical abilities with artistry to manipulate things completely. Such people are usually on an image management overdrive, which explains why Yes Bank, under him, was punching above its weight. What aid them are also connections at right places. So, in their good days, irrespective of political party, the powerful people like to side with them – for the reason they would themselves better know about. So, basically it’s a cocktail of things, that this ‘big brother club’ uses.
Are stories like these – malfeasance on the part of powerful people at the top – difficult to tell? Is it more difficult to say, get other people to talk or to access the depths of these disasters because of the clout of the people responsible?
Absolutely. They can go to any extend to keep their image clean – irrespective of how fragile its foundations are. They use money power, legal might, connections and what not, to stop the things that make them uncomfortable. Yes, they would be very good to you, but only till the moment you don’t make them uncomfortable.
The Banker Who Crushed His Diamonds is an exciting read, sure to keep you at the edge of your seats.