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HDFC Bank shares fall 1% after RBI orders it to temporarily stop launch of new digital initiatives

Erasing all its early gains, the stock dipped 1.33 per cent to Rs 1,388.20 on the BSE. At the NSE, it declined 1.28 per cent to Rs 1,388.85.

By: PTI | New Delhi | Updated: December 3, 2020 2:29:48 pm
An HDFC Bank Ltd. logo sits in a bank branch in Mumbai, India (Photographer: Abhijit Bhatlekar/Bloomberg News)

Shares of HDFC Bank declined over 1 per cent in early trade on Thursday after the company said that the Reserve Bank has asked it to temporarily stop all launches of its upcoming digital business-generating activities and sourcing of new credit card customers.

Erasing all its early gains, the stock dipped 1.33 per cent to Rs 1,388.20 on the BSE.

At the NSE, it declined 1.28 per cent to Rs 1,388.85.

“RBI has issued an order dated December 2, 2020, to HDFC Bank Ltd with regard to certain incidents of outages in the internet banking/ mobile banking/ payment utilities of the bank over the past two years, including the recent outages in the bank’s internet banking and payment system on November 21, 2020, due to a power failure in the primary data centre,” HDFC Bank said in a regulatory filing on Thursday.

Also Read | Explained: Why RBI has ask HDFC Bank to stop digital launches, new credit card sourcing

HDFC Bank said the Reserve Bank of India (RBI) order “has advised the bank to temporarily stop all launches of the digital business-generating activities planned under its program Digital 2.0 and other proposed business generating IT applications and sourcing of new credit card customers”.

In addition, the order has directed the bank board to examine the lapses and fix accountability, HDFC Bank added.

The lender said the above measures shall be considered for lifting, upon satisfactory compliance with the major critical observations as identified by the RBI.

HDFC Bank said “over the last two years, it has taken several measures to fortify its IT systems and will continue to work swiftly to close out the balance and would continue to engage with the regulator in this regard.

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