The country’s largest private sector lender HDFC Bank on Thursday said it would grow its advances at a slower pace than deposits as it focuses on bringing down its credit to deposit ratio to levels prior to the merger with HDFC Ltd. HDFC Ltd merged with HDFC Bank effective July 1, 2023. “It is our endeavour to bring down the credit to deposit (CD) ratio to pre-merger levels and our focus would be to maintain adequate liquidity buffers, repayment of eHDFC (erstwhile HDFC) borrowings as and when they mature, including weighing any prepayment opportunities that may arise, and pursuing profitable sources of lending,” the bank’s Managing Director & Chief Executive Officer, Sashidhar Jagdishan said in his address to shareholders. “During this time of adjustment, the bank would grow its advances a little slower than the deposit growth,” he said. Prior to the merger with HDFC Ltd, the bank’s CD ratio was around 85 per cent. Post the merger, the CD ratio stood at 105 per cent (as on March 31, 2024). He said the bank will continue to focus on granular deposit mobilisation leveraging its inherent distribution strengths. The lender will avoid pursuing growth which does not meet its risk adjusted profitability thresholds, Jagdishan said.
