The board of directors of HDFC Bank is closely monitoring the process of getting regulatory approvals for the proposed merger, Atanu Charkraborty, chairman of the bank said at its 28th annual general meeting. The bank has made necessary applications to various authorities for the merger, he added.
The proposed merger of Housing Development Finance Corporation (HDFC) with HDFC Bank has received ‘no objection’ from the Reserve Bank of India (RBI) for the merger, subject to certain conditions. The merger is also approved by the Pension Fund Regulatory and Development Authority (PFRDA), along with no-objection from the stock exchanges, BSE and the National Stock Exchange (NSE).
The merger is yet to receive approval from the Competition Commission of India (CCI), the National Company Law Tribunal (NCLT) and the shareholders and creditors of the entities. The merger will allow the bank to increase its home loan portfolio while HDFC will be able to access funds at a lower cost.
“A large and more stable balance sheet that the merger would create, would also enable us to step up our exposures and facilitate higher credit growth in the economy,” Chakraborty said.
On April 4, HDFC Group approved the merger of HDFC Ltd into HDFC Bank. Before the merger of HDFC Ltd into HDFC Bank, two other group entities HDFC Investments Ltd and HDFC Holdings Ltd will be merged into HDFC.
On the business side, HDFC Bank is planning to increase its presence in the semi-urban and rural areas of the country. The bank is looking at opportunities to further expand the current network of over 6,000 branches and customer base of 7 crore.
“Given the anticipated resurgence of growth in GDP, the huge scale of the banking opportunity in India, the enormous strength of our franchise and our resilient balance sheet, we believe that we are extremely well poised to leverage the immense opportunities that lie ahead of us,” he said.