A recent report by Macquarie Research indicated that HDFC Bank’s LDR, from a high of about 110 per cent, has declined to 103.5 per cent. (Photo: Shutterstock)
HDFC Bank, the country’s largest private sector lender, on Friday said its deposit growth for the quarter ended September 2024 (Q2FY25) has surpassed its credit growth sequentially. In Q2FY25, the bank reported 5.1 per cent growth in deposits compared to Q1FY25, while its advances during the same period increased by 1.3 per cent, according to an exchange document.
Year-on-year, HDFC Bank’s deposit growth also outpaced its credit growth in Q2FY25. At the end of the quarter, its deposit base stood at Rs 25 trillion, up 15.1 percent higher year-on-year than the same period last year, while its gross advances amounted to Rp25.19 trillion, up 7 percent year-on-year. -year.
HDFC Bank had earlier indicated that it would grow its advances at a slower pace than its deposits as it seeks to reduce its high loan-deposit ratio (LDR) to pre-merger levels. Former mortgage financier HDFC has merged with the bank effective July 1, 2023. During the post-earnings analyst call for the first quarter, the bank’s MD and CEO Sashidhar Jagdishan stated that the bank has aim to reduce your LDR “as quickly as possible.” possible” while maintaining its commitment to profitable growth.
In Q2FY25, the bank also securitized loans worth Rs 19.2 billion as a strategic initiative to reduce its high LDR.
A recent report by Macquarie Research indicated that HDFC Bank’s LDR, from a high of about 110 per cent, has declined to 103.5 per cent, aligning with the bank’s stated strategy of consolidating the balance sheet and focusing on margins and profitability in the medium term.
According to the exchange filing on Friday, HDFC Bank’s Current Account Savings Account (CASA) deposits amounted to Rs 8.83 trillion in Q2FY25, up around 8 percent compared to the second quarter of FY24 and about 2.3 percent compared to the first quarter of FY25. Its term deposits amounted to Rs 16.16 trillion in the second quarter of FY25, up 19, 3 per cent higher than the same period last year and 6.7 per cent higher than the previous quarter, reflecting customer preference for term deposits during this stage of the rates cycle.
Additionally, the bank reported that its advances under management amounted to Rs 26.33 trillion in Q2FY25, up 8 percent year-on-year and 2.3 percent sequentially. It also highlighted that during the quarter, its retail loans grew by around Rs 33.8 billion; commercial and rural bank loans grew by around Rs 38 billion; and corporate loans and other wholesale loans were lower by Rs 13.3 billion compared to Q1FY25.
Shares of HDFC Bank were trading 0.15 per cent higher at Rs 1,684.60.
First published: October 4, 2024 | 11:58 am IS
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