HDFC Bank home loan biz to benefit from low cost of funds
MUMBAI: After the $40 billion merger, HDFC Bank’s home loan business will get a boost from the low cost of funds, said Atanu Chakraborty, Chairman of the largest private bank. Addressing the shareholders at the annual general meeting, he said that the merger would enable the bank to offer to its wider customer base a full suite of financial products.
“As a consequence of the merger, the bank is poised to benefit from the addition of a market-leading home loan product, which can now be directly offered through the Bank’s large network of branches, helping a greater number of people fulfil their aspirations to be home owners,” he said. “The home loan business will also benefit from the low cost of funds that a bank traditionally enjoys,” he added.
Merger of the HDFC twins had come into effect on July 1, creating a financial services giant with a balance sheet of Rs18 lakh crore. The merger has given HDFC Bank entry into the country’s growing home loan market.
The Chairman said that the merger will boost fund flow to the affordable housing segment. “As a consequence of this merger, the larger balance sheet of the bank would offer to the national economy possibilities of higher credit growth, a larger bouquet of financial products and higher flows into affordable housing, agriculture, MSME etc,” Chakraborty said while addressing the bank’s annual general meeting in Mumbai.
The Bank will continue to invest in technology and be at the forefront of digital revolution that India is currently witnessing. He said HDFC Bank is well-placed to capitalise on this opportunity, both for financing private investments and consumer finance, aided by its low cost of funds, wide customer reach and a large and stable balance sheet.
“We feel privileged to be a part of this burgeoning economic environment and India’s growth story,” Chakraborty said. He added that the Bank is committed to supporting small and marginal farmers and taking its products to more villages, thus expanding coverage in rural India. Last year the bank reached customers in about 1.65 lakh villages, and it plans to significantly enhance its footprint in the coming years.