CRISIL

The merger between the Housing Development Finance Corp Ltd (HDFC) and HDFC Bank came into effect on 1st July 2023, Saturday. This created the world's fourth-biggest bank by market value behind J P Morgan, ICBC, and Bank of America. The merger was approved by the boards of directors. All employees of HDFC will become HDFC Bank employees from today. Post-merger, the key HDFC Bank subsidiaries will include HDFC Securities Ltd., HDB Financial Services Ltd., HDFC Asset Management Co. Ltd, HDFC ERGO General Insurance Co. Ltd., HDFC Capital Advisors Ltd. and HDFC Life Insurance Co. Ltd.

The merger was announced about 15 months ago on April 4, 2022, ending two decades of speculation on their eventual union.

Merger Between Housing Development Finance Corporation Limited And HDFC Bank Comes Into Effect

HDFC Bank, India's largest private lender, aims to lower its loan-to-deposit ratio (LDR) to pre-merger levels in the next two to three years, its chief financial officer. The bank's LDR was at around 86-87% prior to its merger with parent Housing Development Finance Corporation in July 2023, and went as high as 110% after the merger, Srinivasan Vaidyanathan said in post-earnings call. LDR is an important metric for banks as it helps assess their liquidity position by gauging whether they have enough deposits to fund loan growth. The ratio has remained elevated since the merger and was at around 100% as of end-September. The bank securitised 190 billion rupees ($2.26 billion) of loans in July-September, Vaidyanathan told reporters on a conference call, without providing detail. "The process will play out for 4-5 years."

HDFC Bank sees pre-merger loan-to-deposit ratio in 2-3 years: CFO Srinivasan Vaidyanathan

HDFC Bank announced its July-September quarter results for fiscal 2024-25 (Q2FY25) on Saturday, October 19, reporting a rise of 5.3 per cent in standalone net profit at ₹16,821 crore, compared to ₹15,976 crore in the corresponding period last year. Net interest income (NII)—the difference between interest earned and paid—rose 10 per cent to ₹30,110 crore compared to ₹27,390 crore in the year-ago period. The September quarter will be the first time HDFC’s year-on-year (YoY) numbers will be comparable after its merger with its parent Housing Development Finance Corp (HDFC) was completed in July 2023. In the merger, HDFC Bank added a large volume of loans to its portfolio but a smaller amount of deposits, putting it under pressure to increase the pace at which it raises deposits or to slow loan growth in the current quarters.

HDFC Bank Q2 Results: Net profit rises 5.3% to ₹16,821 crore, NII up 10% YoY; Asset quality declines

HDFC is exposed to intense competition in the prime home loan segment. Furthermore, given the resilient nature of housing finance as an asset class, banks are aggressively targeting this segment.


The issuer has made timely interest payments.

Deepak Parekh, Chairman

HDFC is the market leader in the mortgage finance industry in India. The company’s portfolio growth is complemented by its strong distribution network comprising 724 outlets.


Established in 1977, the company has a strong track record in the housing finance sector with stable and experienced management.Deepak Parekh is the Chairman of HDFC. The board comprises three executive directors, five non-executive independent directors, and two non-executive non-independent directors


A long track record and portfolio vintage across credit cycles have helped HDFC in building strict underwriting standards and prudent risk management procedures.


HDFC has a strong resource-raising ability at competitive rates and across diversified lender profiles. The company’s ability to raise borrowings at competitive rates enables it to compete in the highly competitive prime housing segment

6.88%Housing Development Finance Corporation Limited 16 Jun 2031

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INE001A07SZ6

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Recent News

Merger Between Housing Development Finance Corporation Limited And HDFC Bank Comes Into Effect

HDFC Bank sees pre-merger loan-to-deposit ratio in 2-3 years: CFO Srinivasan Vaidyanathan

HDFC Bank Q2 Results: Net profit rises 5.3% to ₹16,821 crore, NII up 10% YoY; Asset quality declines

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