Tag: hdfc bank

12 held by Delhi police for attempts of unauthorised withdrawal from high-value NRI account, BFSI News, ET BFSI

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New Delhi [India], October 19 (ANI): Delhi Police Cyber Cell on Tuesday arrested 12 people, including three HDFC bank employees, for allegedly attempting to make an unauthorised withdrawal from a very high-value NRI account.

KPS Malhotra, Deputy Superintendent of Police (DCP) (Cyber Cell), informed that as many as 66 attempts of unauthorised online transactions were made by the group on the high-value account.

“The accused had fraudulently obtained cheque book which has been recovered. Mobile phone number identical to that of account holder’s US-based phone number was also procured by the fraudsters,” the DSP stated.

“On the basis of technical evidence, footprints, and human intelligence, multiple geolocations were identified. In all, raids were conducted at 20 locations across Delhi, Haryana and Uttar Pradesh,” he further informed.

Out of the 12 accused held by the police, three are HDFC bank employees, who were involved in issuing the cheque book, updating the mobile phone number and removing the debt freeze of the account.

The matter came to light after HDFC bank filed a complaint with the Cyber Cell alleging several unauthorised attempts of withdrawal noticed in one NRI account.

“There are many unauthorised internet banking attempts noticed in one NRI bank account. Further, there have been attempts to withdraw cash from the same account, using the fraudulently obtained cheque book. Attempts were also made to get update mobile phone number in the KYC of the same bank account by replacing the already registered US mobile phone number with similar/identical Indian mobile phone number,” HDFC bank’s complaint alleged.

The police informed that in earlier instances, there were attempts of withdrawal of money from this account, and two cases were registered for the same at Uttar Pradesh’s Ghaziabad, and Punjab’s Mohali.

Further raids are in progress and investigation in the case is being carried out. (ANI)



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HDFC Bank’s recast loans rise to 1.7%, NPAs ease, BFSI News, ET BFSI

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Mumbai: HDFC Bank has reported a significant increase in restructured loans under the Covid relief scheme. Analysts are concerned that a large chunk of these loans might turn into non-performing assets (NPAs).

On the positive side, the bank has reported an improvement in gross NPA ratio by 12 basis points (100bps = 1 percentage point) quarter on quarter to 1.35%. Its subsidiary HDB Financial Services also reported a improvement in GNPA to 6.1% from 7.8% in the corresponding quarter last year.

“However, the restructuring pool for the bank surged sharply quarter on quarter to Rs 20,300 crore (1.7% of loans vs. 0.68% in Q1), mainly led by liberal restructuring in the personal loan book. As a prudent strategy, the bank made additional Rs 1,200 crore provisions in Q2 and now carries a contingent plus floating buffer of Rs 9,200 crore (0.8% of loans),” said Anand Dama of Emkay Global in a research note.

Addressing analysts on Saturday, HDFC Bank chief credit officer Jimmy Tata said, “Restructured loans are considered while making the provisions. If there were to be another shock, the balance sheet needs to be much more resilient, historically we have been conservative and our stance does not change”. He added that the bank was monitoring the restructured loan portfolio based on both pre- and post-Covid behaviour of the borrower. “We do not think the impact will be more than 10-20bps on our NPAs at any point in time,” he said.

The country’s largest private lender on Saturday reported a net profit of Rs 8,834 crore for the quarter ended September 2021, up 18% from the previous year.



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At least seven lenders, including Axis Bank, HDFC Bank and ICICI Bank harness GIFT City facilities, BFSI News, ET BFSI

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At least seven lenders, including Axis Bank, HDFC Bank and ICICI Bank, are harnessing the GIFT City facilities to mark a robust Indian presence in the non-deliverable forward (NDF) currency derivatives market, potentially paving the way for eventual currency convertibility that’s considered a draw-card for overseas investments. Average daily volumes in over-the-counter trades at Gujarat GIFT City surged to an estimated $1.5-2 billion from $100-200 million about a year ago, four bankers told ET.

Among the other major participants in the NDF trade are State Bank of India, IndusInd Bank, Kotak Mahindra and Standard Chartered, executives said. “Daily average volumes have surged for offshore OTC NDF trades during the onshore time,” said Bhaskar Panda, executive vice president at HDFC Bank. “This has helped bridge gaps between offshore and onshore prices bringing in relative stability in the exchange rate. This in turn will help attract foreign investors, who always prefer full currency market convertibility.” IndusInd, Kotak and SBI didn’t comment.

The differential between one-month onshore and offshore forwards trade is now less than a paise, which would have been about four-five paise in normal circumstances. A wider differential encourages speculators to tap arbitrage opportunities short-selling rupees or dollars, a potential source for heightened volatility. The one-month Rupee Options Volatility index is now at 4.51 percent versus 7.63 percent nearly a year ago, show data from Financial Benchmarks India (FIBIL). “Axis Bank IBU Branch has been playing a significant role in the NDF markets at GIFT City,” said Lalit Jadhav, CEO – Axis Bank IBU Branch, GIFT City.

“We have a full-fledged Treasury Desk with robust risk controls and look at trading opportunities in this segment which can potentially help reduce volatility and drive price convergence between offshore and on-shore markets.” Before local banks were allowed to tap the NDF market at GIFT City, the Reserve Bank of India was unable to control NDF moves on the rupee-dollar. Now, the central bank even directs private banks along with traditional public sector lenders to buy or sell units, which is known as NDF market intervention.

“NDF business would be one of the core pillars of our business strategy at GIFT City that provides an excellent platform to meet the global banking needs,” said Anupam Verma, head – international banking unit, IFSC GIFT City, ICICI Bank. RBI had permitted Indian banks, which hold a licence to operate in the International Financial Services Centre in GIFT City – Ahmedabad, to participate in the NDF market from June 1 in 2020. “The liquidity has significantly improved in the NDF market at GIFT City with large local banks transacting,” said Anindya Banerjee, currency analyst at Kotak Securities.

“We are gradually moving towards full capital account convertibility making our exchange rate easily available.” RBI deputy governor T Rabi Shankar Thursday called for a preparedness to meet challenges related to full capital account convertibility as foreign investors get full access to India’s debt market under a dedicated route meant for global bond index inclusion.

“A key aspect of currency convertibility is integration of financial markets,” Shankar said at the fifth Foreign Exchange Dealers’ Association of India (FEDAI) annual day. “An effort has already commenced in the interest rate derivative segment.” “NDF-onshore spreads have substantially narrowed after allowing Indian banks into the NDF space,” he said.



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HDFC Bank Q2 net up 17.6% on robust interest income

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Private sector lender HDFC Bank’s standalone net profit increased 17.6 per cent in the second quarter of the current fiscal supported by a robust growth in net interest income.

For the quarter ended September 30, the bank reported net profit of ₹8,834.3 crore against ₹7,513.11 crore in the corresponding quarter last fiscal.

Net interest income grew 12.1 per cent to ₹17,684.4 crore (₹15,776.4 crore). Core net interest margin was at 4.1 per cent.

Other income was up 21.5 per cent at ₹7,400.8 crore (₹6,092.5 crore).

Provisions and contingencies increased 6 per cent to ₹3,924.7 crore (₹3,703.5 crore).

“Total provisions for the current quarter included contingent provisions of approximately ₹1,200 crore,” HDFC Bank said in a statement on Saturday.

Asset quality remained stable and improved on a sequential basis.

Gross non performing assets (GNPAs) rose to ₹16,346.07 crore as on September 30 (against ₹11,304.60 crore).

GNPAs declined 12 basis points during the quarter to 1.35 per cent of gross advances against 1.47 per cent as on June 30, 2021. However, GNPAs in the reporting quarter were 27 basis points higher vis-a-vis the year-ago level of 1.08 per cent. Net NPAs declined to 0.4 per cent of net advances as on September 30, 2021 compared to 0.48 per cent as on June 30, 2021. However, net NPAs rose by 23 basis points vis-a-vis the year-ago level of 0.17 per cent.

Restructured book

The number of requests the bank received for restructuring personal and business loans stood at 6.45 lakh and 6.12 lakh, respectively, under the RBI’s Resolution Framework 2.0 of May 2021. Of this, resolution plans were implemented in the case of 5.5 lakh personal loan accounts and 5.3 lakh business loan accounts. It also received requests for resolution from 9,870 small businesses, of which 6,934 accounts were taken up for resolution.

The total exposure to these accounts before the implementation of the resolution plan was ₹17,397.11 crore.

Meanwhile, of the 3.36 lakh accounts restructured under the Resolution Framework 1.0 with an exposure of ₹7,829.48 crore, ₹1,687.02 crore slipped into NPA in the first half of the fiscal and ₹856.66 crore was written off.

Advances and deposits

Total deposits increased 14.4 per cent on a year on year basis to ₹14.06 lakh crore. Advances increased 15.5 per cent to ₹11.98 lakh crore during the period.

 

 

 

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HDFC Bank Q2 consolidated profit rises 18 pc to Rs 9,096 cr, BFSI News, ET BFSI

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HDFC Bank on Saturday reported an 18 per cent increase in its consolidated net profit at Rs 9,096 crore for the second quarter ended September 2021. The country’s biggest private sector lender had posted a consolidated net profit of Rs 7,703 crore in the corresponding quarter a year ago.

Total consolidated income during the quarter under review rose to Rs 41,436.36 crore from Rs 38,438.47 crore in July-September 2020, HDFC Bank said in a statement.

On a standalone basis, after providing Rs 3,048.3 crore for taxation, it earned a net profit of Rs 8,834.3 crore, an increase of 17.6 per cent over the quarter ended September 30, 2020.

The bank had earned a net profit Rs 7,513.1 crore on standalone basis in the same quarter a year ago, the statement said.

Total income (standalone) grew to Rs 38,754.16 crore in the second quarter of FY2022 from Rs 36,069.42 crore in the year-ago quarter. PTI DP MKJ MKJ



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Four Indian banks rise in Asian rankings on stock market boom, BFSI News, ET BFSI

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Four Indian banks have featured among the 20 largest banks in the Asia-Pacific region in terms of market capitalisation in the third quarter of 2021, according to S&P Global Market Intelligence.

HDFC Bank was ranked seventh with a market cap of $119 billion, a quarter on quarter increase of 6.7 per cent while the next was ICICI Bank at 12th spot, with its market cap rising 11.2 per cent quarter on quarter to $65.5 billion.

The State Bank of India rose two spots to 17th on the list as its market cap rose 8.1 per cent to $54.5 billion. Kotak Mahindra Bank‘s market capitalisation rose 17.5%, the highest on the list.

S&P Global’s banking outlook

The global banking sector will continue to slowly stabilize as the economic rebound gains momentum and as support is gradually withdrawn. Should a re-intensification of risks occur, more support from authorities for the real economy would be required. This in turn would help banks maintain a stabilizing trajectory. Strategies and tactics to combat Covid vary enormously across banking jurisdictions. This includes the progress with vaccination campaigns that affects a range of factors, particularly trade and travel.

Corporate default rates will fall from their COVID-19 peak. However, problematic corporate lending and other exposure will likely continue to strain banks’ asset quality metrics, it said.

Some corporate sectors have experienced no credit deterioration, such as grocery and essential retail, and technology software, while other corporate sectors are recovering sooner than previously expected. Still other sectors, however, such as autos, hotels and airlines won’t likely recover until 2023 or beyond, S&P Global said.

With debt levels at or near record highs, some corporates and governments remain vulnerable to credit deterioration and defaults if income recovers more slowly than expected. This is especially if interest rates rise, S&P Global added.

Indian banks’ outlook

Banks are likely to post over 20 per cent jump in profit in the second quarter with analysts expecting a decent sequential improvement in almost all indicators from loan growth to gross bad loan ratios.

According to Bloomberg estimates, for the 19 lenders — five public sector and 14 private banks – profit would grow 21.7 per cent to Rs 32,075 crore in Q2 year on year.

Private banks are likely to report PPoP growth of 9% YoY (3.8% QoQ) and net profit growth of 14% YoY (17.3% QoQ). Earnings are likely to pick up, led by a recovery in business growth / fee income and a gradual reduction in credit costs.

“Loan growth would pick up, led by revival in economic activity and the opening up of the economy. Demand going into the festive season and commentary around the FY22 outlook would be key monitorables. Retail and SME segment is likely to show strong recovery; though growth in the Corporate segment is likely to remain soft and recovery within this segment would be another monitorable,” according to Motilal Oswal Securities.



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Banks, NBFCs, FinTechs hire as economic revival strengthens, BFSI News, ET BFSI

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Banks and non-banking finance companies are stepping up on hiring plans in anticipation of growth in the economy and improve their digital footprint. Some banks intend to step up hiring by 30-35% over the last year.

HDFC Bank ramp-up

Private lender HDFC Bank, which aims to reach 200,000 villages in the next 24 months, has plans to hire more than 2,500 people in the next six months,

The bank aims to double its presence in the next 18-24 months through a combination of branch network , business correspondents, business facilitators, CSC (common service centres) partners, virtual relationship management and digital outreach platforms.

HDFC Bank will hire 500 relationship managers to expand the coverage of its Micro, Small and Medium Enterprises (MSME) vertical to 575 districts or more by the end of this fiscal. Out of these 500 recruits, half will be for the small and medium sub-vertical, which already has a headcount of 975. This hiring will take the private bank’s MSME vertical headcount to 2,500. India’s largest private sector lender has an employee strength of around 1.23 lakh as of June end.

NBFCs hiring

Shriram Group is hiring 5,000 across its many companies. ICICI Home Finance is looking to onboard 600 employees by December while Kotak Mahindra Bank, too, has resumed hiring closer to pre-Covid levels.

The Shriram Group is recruiting mainly in the south and north India, across tier 3-4 cities. Shriram City Union Finance is expanding its gold loan business,

while Shriram Housing Finance is expanding primarily in Andhra Pradesh and Telangana.

Credit Suisse has plans to hire over 1,000 staff in India this year for a technology innovation office. Deutsche Bank is hiring 1,000 people in India, including 300 graduates and 700 lateral hires.

FinTech hiring

From banking to FinTech, companies are looking to hire with the biggest demand for data analysts, who can handle data using technology and glean relevant information from it.

The FinTech firms are also beefing up marketing and sales teams and are looking beyond commerce and engineering backgrounds with a background in data analysis, artificial intelligence and exceptional soft skills. They are looking to pay higher salaries who have Big Data, advanced analytics and financial skills.



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Five banks may bid for Citi’s India consumer businesses, BFSI News, ET BFSI

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Five top lenders, including HDFC Bank and Kotak Mahindra Bank, are expected to submit binding bids for the Citi India consumer businesses before the October 26 deadline, two officials aware of the development told ET.

Axis Bank, IndusInd Bank and DBS India are also in contention for the businesses Citi is exiting in India. Although the US lender is seeking a valuation in excess of $2 billion, the bids could be more circumspect after Citi lost significant market share in its retail and credit card books, one of the executives cited above said.

HDFC Bank and Kotak Mahindra Bank, two of India’s top three most valued private sector lenders, are considered front-runners to win the business that generates about $1 billion in revenue.
“While Citi’s retail franchise remains excellent, the book has shrunk. It has lost significant market share and due to the exit plans, it has not been able to focus on enhancing the existing book and adding quality customers,” said an official involved in the bidding process.

“Still, Citi has received multiple bids from domestic banks. Plus, it is also expected to receive bids from global suitors that may be looking to pick up consumer assets in several markets the bank has exited,” the official said.

Citi India said it has received strong interest from bidders.

“We are pursuing consumer franchise sales with a focus on optimising results for our people, our clients and our shareholders,” a spokesperson for Citi India said in a mailed response to ET’s queries. “Conversations with potential buyers continue in these markets, including India, with strong interest from a broad range of bidders.”

HDFC Bank, Kotak Mahindra Bank, DBS India, Axis Bank and IndusInd Bank did not respond to ET’s mailed query.

Citibank, under its first woman CEO Jane Fraser, decided to exit retail businesses in 13 markets to conserve capital and focus on higher yielding revenue streams. The Citi management has indicated that the exit process is currently on and that while it will look to complete the exits in a timely manner, the retreats wouldn’t be anything akin to so-called fire sales.

Citi’s consumer portfolio contributes about a third to the India business on profitability while the total India business contributes 1.5% in profits to the lender’s global book.

The Indian retail basket includes credit cards, deposit accounts, wealth management and a mortgage portfolio. Overall, Citibank’s India unit had a market share of advances and deposits of 0.6% and 1.1%, respectively. In India, Citibank has more than 2.5 million retail customers, 1.2 million bank accounts and nearly 2.6 million credit cards. It lost more than 100,000 customers since announcing its exit.

The Right Mix
Although Citi is India’s sixth-largest card issuer, it has lost market share on card spends – from 20% a decade ago to 4% now. However, it has consistently logged 15-25% higher expenditure per card against the industry average, an analysis by Macquarie showed. A mix of premium cards and corporate salary account cards in the portfolio makes the Citi business attractive for bidders. “We have done due diligence on the book; it’s a good franchise for banks that don’t have an existing credit card or wealth book and it only makes sense at a good valuation. We will have to see how aggressively we bid,” said a top official at a bank that is likely to submit its bid.



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Bank FD to fetch negative real interest with elevated inflation, BFSI News, ET BFSI

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New Delhi, Oct 12 (PTI) Senior citizens and others depending upon income from bank fixed deposit (FD) schemes will be at the receiving end with the retail inflation exceeding the interest rates. The Reserve Bank of India (RBI) in its latest monetary policy review has projected retail inflation at 5.3 per cent for the current financial year.

Last week, the RBI said that the Consumer Price Index (CPI)-based inflation is now projected to be at 5.3 per cent for 2021-22 with risks evenly balanced.

At this level, the fixed deposit for one year with the country’s largest lender State Bank of India (SBI) would rather earn negative interest. The real interest rate would be (-) 0.3 per cent for the saver.

Real rate of interest is card rate minus inflation rate. The retail inflation for August stood at 5.3 per cent.

Even for higher tenure 2-3 years, the interest rate earned is 5.10 per cent lower than expected inflation for the current fiscal.

In the private sector, the market leader HDFC Bank offers 4.90 per cent interest rate for 1-2 year fixed deposits while 5.15 per cent for 2-3 years.

However, small savings schemes run by the government offers better return compared to fixed deposit rates of banks. For term deposits 1-3 years, the interest rate offered is 5.5 per cent higher than inflation target.

There is natural advantage of moving money from bank FD to government saving schemes as rates are slightly higher. Thus, the real rate of interest is in the positive territory.

Experts said that it is a usual phenomenon that real returns are negative in a crisis and post-recovery world, given the way fiscal stimulus to overcome difficulty.

India is no exception and in fact, new asset allocation patterns would need to emerge, with more allocation to real assets from financial assets.

Real rates are going to be negative for a while, given that the post crisis repairs may take some time and it is imperative that financial literacy initiatives guide people into making the right investment choices, Grant Thornton Bharat partner Vivek Iyer said.

“A negative rate of interest, for savers on bank deposits, these days, is a reality, which the depositors have to face because of a complex set of factors.

“The present average savings deposit rate offered by banks which is around 3.5 per cent and less than five per cent rate on one year deposit indicates a negative return, not even covering the expected inflation rate,” Resurgent India Managing Director Jyoti Prakash Gadia said.

The impact of negative interest on bank savings deposits is obvious, with lower growth of such deposits and the public now seeking alternatives like mutual funds and equity for better returns.

The options although involving more risk have shown phenomenal growth which is likely to continue till inflation is tamed or bank deposit rates are substantially increased, Gadia added. PTI DP CS HRS hrs



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