HDFC Bank's MD and CEO Sashidhar Jagdishan, on July 17, asserted that over 26 years, the lender has invested in tech way ahead of time and its clear focus is on digitising and improving productivity without laying off people.
“Our aim is to become like a fintech,” he said while addressing the HDFC Bank annual general meeting (AGM).
Jagdishan’s comments come against the backdrop of the bank's tech issues that prompted the Reserve Bank of India (RBI) to ban it from offering new digital products and onboarding new credit card customers.
The HDFC Bank MD added that the ban on sourcing credit cards has affected business and data shows the bank lost some market share over the past eight months.
He, however, was confident that the bank would bounce back soon. “We were one of the last entrants in the credit cards biz, became no.1 in these past 17-18 years,” he said.
Speaking about the tech ban, Jagdishan admitted the regulator pulled up the bank for a valid reason. “We have noticed that our recovery time from outages was not meeting global standards. Have a clear plan that is being monitored at the board level for tech transformation,” he said at the AGM.
He added that tech transformation will not happen overnight, but will take 12-15 months.
Commenting on the ban on Mastercard, Jagdishan said the bank is protected against its impact. HDFC Bank’s open architecture allows it to partner with other card networks easily, he said.
Earlier in the day, HDFC Bank reported a 14.36 percent growth in its consolidated net profit at Rs 7,922.09 crore. Its net profit on a standalone basis stood at Rs 7,729.64 crore in the June 2021 quarter, as against Rs 6,658.62 crore in the year-ago period and the preceding March quarter’s Rs 8,186.51 crore. The bank’s total income increased to Rs 36,771 crore in April-June 2021, as compared to Rs 34,453 crore in the year-ago period.
“Both FY21 and through this FY, we are still in unprecedented times. People who had to move out to meet customers could step out only 40 days of Q1FY22,” Jagdishan said, hoping that the bank will bounce back reasonably well as normalcy returns.
Speaking about the companies monetisation plans, he said it was too premature to think about monetisation of HDFC Sec Ltd.
“HDB Financial Services caters to the segment which has been impacted by the pandemic. Casualties of HDB's customers in the lower segment is 4-5X of what we see normally,” he said at the AGM.
He added that though there are no monetisation plans for HDB yet; the bank may try price discovery initially. “We will watch how HDB Financial Services recovers in a normal environment and then look at listing it,” he said.
(Edited by : Kanishka Sarkar)
First Published: IST