HDFC Bank Limited

Kunal Shah

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Suresh Ganapathy

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Suresh Ganapathy

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Suresh Ganapathy

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Suresh Ganapathy

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Suresh Ganapathy

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Suresh Ganapathy

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Suresh Ganapathy

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Suresh Ganapathy

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Mahrukh Adajania

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In fact, 3Q has shown a decline over 2Q in terms of absolute accretion of deposits.

— Suresh Ganapathy

Do you think you can sustain the current level of margins or there could be any margin pressure?

— Suresh Ganapathy

But the other question that you asked is the margin under pressure?

— Suresh Ganapathy

There is clearly pressure from alternate channels.

— Rahul Jain

Frontline means either they are in retail asset sales, which entails because you know that after a couple of years of slowdown we did pick up, so retail asset sales.

— Kunal Thanvi

A lot of these risk-related type of fee, where people check bounce fees or the late payment fees or the over credit limit fees, et cetera, et cetera.

— Kunal Thanvi

They all came down, because they are all risk-related fees.

— Kunal Thanvi

But within a given segment, have you seen a change in your risk footprint over last two, three years, which can also explain, at least part of that linkage?

— Pranav Gundlapalle

Classification - Public Classification - Public And one other thing is also it comes with a lower risk weights, anywhere from 20%, 30% and retail comes to the 100% risk weight.

— Pranav Gundlapalle

Yes, it comes with a different type of risk metrics.

— Pranav Gundlapalle

Q

So firstly, with respect to… Srinivasan Vaidyanathan: Kunal, just one second. The team told me that I have to correct two things. I think, I was referring to the profit before tax is INR 16,218 crores, I think was referring somewhere. And the contingent provisions, I said INR 3,400 crores or something it is INR 9,400 crores, that's all I just want to -- because I was referring wrong places. Now go ahead, Kunal.

Kunal Shah

Sure. Yes. So firstly, on opex and particularly the employee cost side, no doubt we have added quite a lot of employees over last couple of quarters. But was there any other extraordinary within that wherein maybe the sequential growth was also quite high and both as well as year- on-year, so if you can highlight on that part? Yes. Srinivasan Vaidyanathan: One is that normally the third quarter is the seasonal with a lot of activity in that time period. That's number 1. Number 2, on the people cost, apart from adding of people both for business growth and branches, there is also another tranch

Q

Yes. Srini, so two questions. One is on deposit accretion itself. So, if you look at Q2, the deposit accretion is INR 600 billion or if you look at purely in retail deposits, it's INR 670 billion and the previous quarter was INR 680 billion on overall deposit. The initial guidance was that eventually you want to take it to INR 1 trillion with every quarter showing an improvement, but that has not happened in 3Q. In fact, 3Q has shown a decline over 2Q in terms of absolute accretion of deposits. So, what's happening here, are we on track to get that INR 1 trillion accretion? Any color on that w

Suresh Ganapathy

And the next two questions, is first on margins. Your margins are flat Q-o-Q or Y-o-Y also for that matter, whether you look at repo on assets or interest earning assets. My point here is Srini, bulk of the deposit rate hikes have actually happened between September to December. You can see actually all banks. even Post, the SBI and even yourselves included have hiked deposit rates quite aggressively. So, if you have not seen a margin expansion this quarter, especially when deposit rate hikes are yet to flow through, what happened next quarter when some of the deposit repricing? Or at least th

Q

Yes. So I had a question, partly linked to Suresh. So, your asset growth for the quarter was just 3% Q-o-Q, whereas you know at the time of the merger or at the Analyst Day, the guidance was achieving 18% Y-o-Y, even on a merge balance sheet basis. Should does that stay? And were there corporate loan exists at the end of the quarter? Srinivasan Vaidyanathan: So there are two aspects. You touched upon how to think about the loan growth and then we've talked about the wholesale growth at the end of the quarter. The way you think about the loan is not quarter-to-quarter. That is why we give kind

Mahrukh Adajania

But my broader question was that, if you see some of the economies have already downgraded growth forecasts for India. So, what is your sector growth assumption for FY'24? And then of course you would grow above the sector to justify your 17% to 18% year-on-year growth for the next year and then maybe for the next two to three years? So, is it just a tactical call based on pricing? I think there is adequate growth to grow 18% with quarterly variation? Is that a fair assumption? Srinivasan Vaidyanathan: Yes. It's a fair assumption, it is a tactical thing. We see good demand for loans, more than

Q

Srini, so three questions. One is, could you comment on what's your revolve rate on the cards business? And your spends have gone up. I just want to see what the revolve rates are? The second is what will be the LCR both for the average and period end? And lastly, just coming back to this NIM, so this cycle, HDFC Bank has shown lower NIM sensitivity versus if I look at your private sector peer group. So, would it be fair to say, as rates -- if they were to go down maybe in second half of the year, we should again see lower sensitivity on NIMs today? That will be three. Srinivasan Vaidyanathan:

Management

Q

Yes, Srini. This is Rahul Jain on behalf of Hardik. Two, three questions. Number one, again coming back to deposit growth. I mean for the whole industry itself; the growth is not really showing any acceleration and banks and all have kind of increase the rates. There is clearly pressure from alternate channels. So do you want to hazard a guess as to the banks need to touch the savings rate also in this in the next couple of months to push on the deposit mobilization? Srinivasan Vaidyanathan: I do. I certainly don't want to take a guess, but that is you know that that has been something that ov

Rahul Jain

So, I mean, what measures can banks take or eventually the loan growth have to take a knock, because the CD ratios are don't have much of a scope, I mean, it can still go up by couple of percent. But how will you all kind of manage the whole growth versus deposit dynamics? Srinivasan Vaidyanathan: See the growth of deposits, one, of course, the market itself grows at certain rate. And the goal is to grow faster than the market to gain the share. So, like for example, our share is slightly under 10% and gross at call it 80 to 100 basis points in the last year. And similarly, over a five- year p

Q

Hi. Srini, I have two, three questions. Firstly, if you can provide some color on the credit card acquisition strategy? We recently talked about like doing 1 million cards per month. How are you planning to achieve this and the timeline for it? Srinivasan Vaidyanathan: One, we acquired 1.2 million cards in the quarter. And I don't think we have said 1 million per month if anything that's more of a strategic call. But I can tell you that we are at about 1.2 million in this quarter and the prior quarter was slightly under 1 million for the quarter. That's the kind of rate at which we are acquiri

Nitin Aggarwal

This was there in the media very recently, so I thought of clearing this. But no worries. Secondly, like this quarter we have consumed small amount of contingent provisions. So what is your approach to utilization of these provisions going ahead? Srinivasan Vaidyanathan: See every quarter as we have said in the past, we evaluate what to do and if there is a kind of a minor release, it happens, or a build that happens. But broadly, if you think about how to think about it, which is also I think one of the notes we have given the COVID, one of the important kind of drive that we build the reserv

Q

So I had two questions. One was the employee addition. Can you throw some light on the breakup of employee addition in terms of branch related and others? And within others, what are the areas where we are adding employees? Because last nine months we have added around 25,000 employees, how much work to do with new branches and how much is non-branch? Srinivasan Vaidyanathan: See, the most of the staff additions will be in frontline. Frontline means either they are in retail asset sales, which entails because you know that after a couple of years of slowdown we did pick up, so retail asset sal

Kunal Thanvi

Sure. And the second question was on, if you look at our fee income, the share of credit cards and payment products have been gone to 34% for this quarter. So can you throw some light on Classification - Public Classification - Public how the contribution of fee and payments have been improving? And what's the outlook there? What is that sustainable number one should look at? Srinivasan Vaidyanathan: Again, it depends on yes, the payment business was 32% of the total fees last quarter, 33%, in this quarter. So it is more or less in that kind of it. And normally in the third quarter you would e

Q

Hi, Srini. Okay. If I were to just ask one clarification. What is the accounting treatment of IBPC? And when HDFC mortgage book customers who had to come down to your bank, how does the pricing of those loans move? Because they have a different interest rate regime and banks have a different interest rate regime. Srinivasan Vaidyanathan: On the accounting literature, I think it's in a public document somewhere in terms of what that is and we can take it offline or one of our finance team can talk to you to, to show you where it is. So it's a very simple thing, you'll see.

M.B. Mahesh

Sir, in the sense, do we have to move to EBLR or do they have a choice to continue where they are? Srinivasan Vaidyanathan: This is on the mortgage, you are talking about, right? Absolutely. Srinivasan Vaidyanathan: Your second aspect of the question in terms of the mortgage. There will be a one-time change that we will do when the migration happens. We are working through that my integration process, and once it integrated, we'll exactly communicate with the customer how that will move. And then of course at any point in time customers have a choice. Even today they have and in future they wi

Q

Just a quick question on the NIM. You explained how the change in loan mix is driving the change in NIMs, so that's clear. But within a given segment, have you seen a change in your risk footprint over last two, three years, which can also explain, at least part of that linkage? Then if we look in personal loans, going to add safer segments or would the corporate going to add safer segments, anything you see of that sort play out? Srinivasan Vaidyanathan: Pranav, your line is echoing, I didn't get it all. I know the question is about the NIM from two, three years and something, but I didn't ge

Management

Q

Okay. I'll please try it once again. My question was, you explained about how change in loan segment, explained the change in NIM that you've seen. Is there a change in relative riskiness of the between the segment itself? Have you seen a shift to a safer or less risky segments within personal or any particular segment? Srinivasan Vaidyanathan: I got it. You are asking about the relatively, of course, yes, absolutely, because the change in our composition that we saw when the wholesale moved from 45% to 55%, from a total composition, we did see a significant improvement in the quality of the c

Management