# HDFC Bank

HDFC Bank Limited is an Indian banking and financial services company, headquartered in Mumbai. It is India's largest private sector bank by assets and market capitalization.
The Reserve Bank of India (RBI) has identified the HDFC Bank, State Bank of India, and ICICI Bank as Domestic Systemically Important Banks (D-SIBs), which are often referred to as banks that are “too big to fail”.
As of April 2024, HDFC Bank has a market capitalization of $145 billion making it the third-largest company on the Indian stock exchanges. It is also the sixteenth largest employer in India with over 173,000 employees, following its takeover of parent company Housing Development Finance Corporation.

## History

HDFC Bank was incorporated in 1994 as a subsidiary of HDFC Ltd, which received an 'in principle' approval from the RBI to set up a bank in the Private Sector as part of its liberalization of the Indian banking industry. The bank commenced operations in January 1995, with its registered office in Mumbai. Its first corporate office and a full-service branch at Sandoz House, Worli, was inaugurated by the then Union Finance Minister, Manmohan Singh.
In February 2000, Times Bank merged with HDFC Bank, which was India's first-ever voluntary merger of banks. Times Bank was established by India's largest media conglomerate, The Times Group.
In July 2001, HDFC Bank's ADS listed on the New York Stock Exchange after an IPO.
In 2008, HDFC Bank acquired the Centurion Bank of Punjab (CBoP) for ₹9,510 crore (US$2.19 billion) in a share-swap deal, reportedly the largest acquisition in the Indian financial sector at the time.
In 2021, the bank acquired a 9.99% stake in Ferbine, an entity promoted by Tata Group, to operate a pan-India umbrella entity for retail payment systems, similar to the National Payments Corporation of India.

### HDFC Ltd–HDFC Bank merger

On 4 April 2022, HDFC Ltd announced that it would merge with HDFC Bank, marking India's largest-ever M&A deal. As part of the merger, HDFC Ltd would transfer its home loan portfolio to HDFC Bank, while the bank offered depositors of HDFC Ltd the choice of either withdrawing their money or renewing their deposits with the bank at the interest rate that the bank was then offering.
On 1 July 2023, the merger of HDFC Ltd with HDFC Bank was completed. Consequently, HDFC Bank had a market capitalisation of $154 billion, becoming the seventh most valuable bank in the world. HDFC Bank also became one of the world's top 100 banking companies by total assets.
The combined entity had a customer base of 120 million, surpassing the population of Germany in size. The merger resulted in a substantial increase in bank headcount, with the workforce totaling 177,000 employees. The merged entity became the second-largest bank in India, trailing only the State Bank of India in terms of assets. The number of branches increased to 8,300.
Shares of HDFC Ltd were delisted and shareholders were allotted 42 shares of HDFC Bank for every 25 shares of HDFC Ltd held, leading to an increase in the equity capital of HDFC Bank.

## Operations

As of March 2024, HDFC Bank's distribution network included 8,735 branches and 20,938 ATMs (cash recyclers; cash deposit and withdrawal) spread throughout 3,836 cities and villages. The distribution network of HDFC Ltd., which consists of 737 locations and includes 214 offices of HDFC Sales Private Limited, has been integrated into the network of the Bank.
HDFC Bank is the sole private bank operating in the union territory of Lakshadweep after opening a branch in Kavaratti island.

## Products and services

HDFC Bank provides a number of products and services including wholesale banking, retail banking, treasury, auto loans, two-wheeler loans, personal loans, loans against property, consumer durable loan, lifestyle loan and credit cards. Along with this various digital products are PayZapp and SmartBUY. It also launched SmartWealth app in 2024.

### Digital rupee

On 29 August 2024, HDFC Bank introduced User-Level Programmability on Digital rupee. It is now supported by the HDFC Bank Digital Rupee Wallet, allowing users to guarantee that payments are paid for specified purpose. Individual users can optionally design other characteristics using this capability, such as the validity period or the geographic regions in which Digital rupee can be utilized.

## Subsidiaries and associates

Notable subsidiaries and associate companies of HDFC Bank include:
| Name | Type | Ownership stake |
| HDFC Life | Life insurance | 50.37% |
| HDFC ERGO | General insurance | 50.48% |
| HDFC Asset Management Company | Mutual funds | 52.55% |
| HDFC Securities | Stockbroking | 95.48% |
| HDB Financial Services | Consumer finance | 94.84% |
| HDFC Capital Advisors | Private equity real estate | 90% |
| HDFC Credila | Education finance | 9.99% |

## Listings and shareholding

The equity shares of HDFC Bank are listed on the Bombay Stock Exchange and the National Stock Exchange of India. Its American depositary receipts are listed on the NYSE.
Its global depository receipts (GDRs) were listed on the Luxembourg Stock Exchange but were terminated by the board of directors, following its low trading volume..

## Controversies

On 2 December 2020, the Reserve Bank of India (RBI) ordered HDFC Bank to temporarily halt the issuance of new credit cards and all planned activities under the bank's Digital 2.0 program, citing incidents of outages in the bank's internet banking, mobile banking and payment utility services.
On 29 January 2020, RBI imposed a monetary penalty on HDFC Bank for failure to undertake ongoing due diligence in case of 39 current accounts opened for bidding in the initial public offer.
A HDFC Bank manager was arrested on charges of fraud, involving a sum of ₹59,41,000 in Odisha.
Altico Capital and Dubai's Mashreq Bank have approached RBI, accusing HDFC Bank of violating regulatory provisions by debiting part of the funds the company had raised through external commercial borrowing (ECB) and parked at the bank. They claimed that HDFC bank's decision to transfer money from the account may be a violation of the RBI's end-use rule.
On 27 May 2021, RBI imposed a penalty of ₹100 million on HDFC Bank for deficiencies in regulatory compliances with regard to its auto loan portfolio. The said penalty was imposed with regard to the contraventions of certain provisions of the Banking Regulation Act, 1949.
In March 2023, HDB Financial Services suffered a breach exposing the data of more than 70 million customers, including email addresses, names, dates of birth, phone numbers, genders, post codes and loan information belonging to the customers.