Rajiv Kumar, Chairman of HDFC Bank, stated that India's largest private lender remains fundamentally strong due to robust governance systems, while expressing confidence in improving CASA and margin figures over the next two to three years.
Kumar emphasized that despite recent events involving his former part-time chairman, the bank has no systemic governance problems. He noted that large institutions like HDFC Bank may periodically face difficulties, but it is crucial that these matters are resolved promptly and transparently.
During his first address as Chairman at the annual general meeting of shareholders, Kumar assured that the bank possesses control systems and safeguards to detect any deviations, and that oversight at the committee level is strong. He reiterated on behalf of himself and the Board of Directors that the bank maintains an impeccable balance sheet and is fundamentally sound, with no systemic governance issues.
The Board of Directors, according to Kumar, is committed to ensuring that HDFC Bank operates at the highest level of corporate governance, remaining based on principles of integrity, transparency, accountability, and prudent management. Kumar added that governance has always been and will remain the foundation of the institution, and the bank will adhere to a 'zero tolerance, no repeat tolerance' policy for any deviation from established policies or ethical standards.
Following the departure of former part-time chairman Atanu Chakrabortty, the board hired domestic and international law firms under the supervision of a special committee of independent directors, whose findings were disclosed to stock exchanges on June 26.
Kumar believes that strong institutions are defined by the power of their processes and policies, which must identify issues, investigate them, take corrective action, disclose information when necessary, and hold those responsible accountable.
Beyond governance issues, Kumar noted that the country's largest private lender is on the cusp of transformation and ready to enter the next phase of growth. This growth will be driven by investments in technology, merger synergies, and strengthening the deposit business.
He stated that confidence in the bank's next phase of development is based on a long-standing commitment to a customer-centric philosophy and technological execution. With modernized technology platforms and deeper penetration across India, the bank has reached a turning point, poised to deliver significantly higher business results.
Kumar acknowledged that the merger with HDFC Ltd. structurally changed the bank's balance sheet, particularly the ratio of Current Account Savings Accounts (CASA) and Net Interest Margins (NIMs), but expressed confidence that both metrics will improve over the next two to three years. He explained that by continuing to increase its share in the deposit market and focusing more on the consumer side of the economy, they are confident in the improvement of these metrics.
It was noted that the merger has already begun generating business momentum, with cross-selling between the bank and its subsidiaries remaining healthy. Over 95 percent of new mortgage loan customers now open savings accounts with HDFC Bank, strengthening customer relationships and positioning the lender as the primary banker for a wider customer base.
Highlighting the technology strategy, Kumar reported that HDFC Bank has modernized its core technology stack, strengthened internal engineering capabilities, and implemented Generative Artificial Intelligence (GenAI) across the organization through its proprietary 'Neev' platform. He added that these targeted and forward-looking investments have enabled accelerated customer acquisition, seamless onboarding, intuitive service, and increased employee productivity. The bank will continue to invest in technology and operational platforms to enhance productivity, improve customer experience, and ensure long-term competitiveness.
