Mumbai: Private sector HDFC Bank aims to ride the growth opportunities thrown up by the increasing affluence of rural India to grow at a faster pace than the industry average over the next few years, a top bank official said.
The bank will also focus on organic growth, having completed the acquisition of Centurion Bank of Punjab (CBoP) a couple of years ago, which has given it a strong pan-India footprint, he said.
“There is a tremendous opportunity in rural India and with the country’s GDP poised to grow at 8% plus over the next few years, HDFC Bank is well-positioned to tap this opportunity for rapid growth,” managing director Aditya Puri said.
Describing rural India as “Bharat”, Puri said that HDFC Bank is well-poised to exploit the growth opportunities here in terms of both products and branches.
“Bharat is growing rapidly there are agricultural reforms taking place, supply-chains are being developed and improved, per capita income is increasing and ancillary units are growing around manufacturing. All this makes HDFC Bank optimistic about its, and the country’s financial sector’s, growth going forward,” Puri said.
The bank constantly innovates and comes up with new offerings, he said, citing the example of its loans against gold jewellery facility.
“Now we give loans against gold jewellery, which helps us tap business from small shop-keepers, small businesses and others in rural areas. This business is a good one in the interiors of the country,” the HDFC Bank chief said.
HDFC Bank’s strategy presently is to grow organically and “we have the ability to achieve our future growth targets organically,” Puri said.
“There is no necessity for any acquisition now,” he said in reply to a specific question on the issue.
The bank has a healthy footprint across the country, thanks to its past acquisitions, beginning with Times Bank in the late-1990s.
“The acquisition of Centurion Bank of Punjab (CBoP) gives us a footprint in the South, as well as the North. We are anyway strong in the West,” he said.
CBoP itself is an amalgamation of Lord Krishna Bank (South) and Bank of Punjab (North).
“Besides, we have laid a great deal of emphasis on our asset quality -- it has never been in distress and our NPA levels are very low,” Puri said.
On fund-raising, he said it is not on the immediate horizon. “We have a capital adequacy ratio of over 16 % there is no need for us to raise funds immediately,” Puri said.