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Synopsis: HDFC Bank's CEO, Sashidhar Jagdishan, addressed shareholders during the bank's annual general meeting, expressing confidence in the bank's ability to overcome challenges following the merger with HDFC Ltd. Despite facing short-term difficulties, including liquidity issues and a higher credit-deposit ratio, Jagdishan emphasized the long-term benefits and strategic advantages that the merger will bring to the bank's growth and profitability.
During HDFC Bank's annual general meeting, CEO Sashidhar Jagdishan discussed the ongoing adjustment phase following the merger with HDFC Ltd. He stated that while the bank is facing challenges, including tighter liquidity and a higher cost of deposits due to the Reserve Bank of India's recent rate hikes, he remains confident in the merger's long-term benefits.
Jagdishan reassured shareholders that the bank's focus is on building a strong liability franchise and growing deposits at a faster pace than advances to bring down the elevated credit-deposit ratio to pre-merger levels. He noted that the bank is also expanding its branch network to boost deposit growth, which he emphasized is crucial for the bank's sustained profitability.
The CEO also acknowledged a shift in consumer preferences towards mutual funds, equities, and real estate, which the bank is addressing through its product bundling strategy. He highlighted that the bank is leveraging its extensive distribution network to cross-sell products like home loans, insurance, and wealth management services, thereby creating a more diversified and resilient business model.
Despite the immediate challenges, Jagdishan is optimistic about the future, stating that the merger has opened new avenues for growth and positioned HDFC Bank as a formidable player in the financial sector. He also pointed out that the bank's employee attrition rate has decreased, reflecting a positive internal environment amid the ongoing transition.
