HDFC Bank, the largest private bank in India, was one of the initial banks to gain authorization from the Reserve Bank of India (RBI) to establish a private sector bank in 1994. By May 2024, the Bank's extensive distribution network encompassed 8,778 branches and 21,132 ATMs/Cash Recycler Machines, spanning across 3,836 cities/towns. (Please refer the blog HDFC Bank - Journey from Bank to Financial Services Conglomerate)
Awards and Recognition in FY2023-24:
- HDFC Bank has been awarded the ‘Best Bank of the Year’ (Joint Winner) and ‘Best Large Indian Bank’ award at the 28th BT - KPMG Best Banks and NBFCs Survey 2022-23.
- It was awarded as the ‘Conscious Corporate of the Year’ at the Economic Times Awards for Corporate Excellence 2023.
- It was awarded as the ‘Best Private Sector Bank’ at Financial Express Best Banks Awards 2023.
- Awarded as the ‘Best Domestic Corporate Bank’ and ‘Best Bank for SMEs’ in India at Asiamoney Best Bank Awards 2023.
- HDFC Bank was awarded as the ‘India's Leading Private Bank (Large)’ at the 16th edition of Dun & Bradstreet BFSI & Fintech Summit 2024.
- HDFC Bank was adjudged as the ‘Best Private Bank for Education and Training of Private Bankers (Asia) and Private Bank for Growth Strategy (Asia)' at the Global Private Banking Awards 2023.
- The Bank is certified as ‘Great Place To Work’ for the Year 2024-2025 by Great Place to Work Institute.
Products and Services
HDFC Bank offers a wide range of banking services, including commercial and investment banking for wholesale clients, as well as transactional and branch banking for retail customers. The bank is divided into following business segments:
Retail Banking: HDFC Bank focuses on retail banking for individuals, salaried workers, small businesses, SHGs, and NRIs. They excel in Auto Loans, Personal Loans, Payments, and offer Wealth Management Services to HNIs.
Home Loan/Mortgages Business: After merging with HDFC Limited, HDFC Bank now offers a wide range of housing loans to cater to customers from various income groups, solidifying its position in the home finance sector.
Wholesale/Corporate Banking: The business serves large corporates, PSUs, Government, and multinational corporations by offering a range of commercial and transactional banking services including working capital finance, trade services, transactional services, and cash management. It also provides structured solutions that integrate cash management services with vendor and distributor finance to enhance supply chain management. The Investment Banking business helps companies raise capital through Debt Capital Markets and Equity Capital Markets, as well as providing rupee loan syndication services and advisory services.
Commercial and Rural Banking (CRB): The Bank's CRB Group serves MSMEs, emerging corporates, commercial agriculture, small farmers, healthcare, equipment finance, and transport companies in SURU areas, meeting Priority Sector Lending requirements.
Treasury: The Treasury oversees the Bank's cash, liquid assets, and investments in securities and market instruments. It monitors liquidity and interest rate risks, ensures compliance with reserve requirements, and generates fee income from customer transactions. The Treasury also effectively manages foreign exchange and interest rate risks.
Key Financials (FY2024):
At the conclusion of the financial year 2024, HDFC Bank's Total Assets amounted to Rs 3,617,623 Cr. The Bank experienced a significant 46.7% increase in Total Assets year-on-year and a 27.5% increase over a 3-year period on a CAGR basis.
The Bank's Deposits saw a year-on-year growth of 26.4% and a 21.2% growth over 3 years on a CAGR basis. In contrast, Loans and Advances showed a year-on-year growth of 55.2% and a 29.9% growth over 3 years on a CAGR basis, surpassing the deposit growth during the same timeframe. Deposits stood at Rs 2,379,786 Cr and Loans and Advances at Rs 2,484,861 Cr at the end of FY2024. An interesting observation is that Loans and Advances exceed deposits, which have been financed through borrowings. (Please refer the blog Sources of Funds of Banking Business
The Bank achieved a Net Interest Income (NII) of Rs 108,532 Cr for FY2024, with a Net Profit of Rs 60,812 Cr. The NII saw a 25.0% year-on-year growth and an 18.7% increase over 3 years on a CAGR basis. In contrast, the Net Profit experienced a 37.9% year-on-year growth and a 25.0% increase over 3 years on a CAGR basis.
Moreover, the Bank's Capital Adequacy Ratio surpassed the RBI's mandated percentage, reaching 18.8%. The Gross NPA and Net NPA were reported at 1.24% and 0.33% respectively. The Bank's Net Interest Margins were at 3.0% and the Net Profit Margin at 23.53%. Additionally, the CASA ratio stood at 38%, slightly below the industry CASA average of 40%.
Future Plan
HDFC Bank’s Project Future Ready is anticipated to drive, foster, and seize the upcoming surge in Corporate Banking, Commercial (MSME) and Rural Banking, Government and Institutional Business, Wealth Management, Retail Assets, and Payments. This growth will be facilitated by its delivery channels of Branch Banking, TeleSales/Service/Relationship, and Digital Marketing. The bank's payments business is projected to maintain its strong performance.
The Bank considers Branch Banking as the cornerstone of its customer relationships, emphasizing the importance of physical branches, especially in semi-urban and rural areas. Plans are underway to expand branches in SURU locations, with new branches playing a crucial role in deposit mobilization. Anticipated growth in this channel is expected to encompass a wide range of service interactions as the bank progresses.
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Data Source
- HDFC Bank's website
- HDFC Bank's Annual Report 2023-24
Disclaimer
The content or analysis presented in the Blog is exclusively intended for educational purposes. It is important to note that this should not be considered as a suggestion for investing in stocks or as legal or medical advice. It is highly recommended to seek guidance from an expert before making any decisions.