Improving consumer sentiment enabled HDFC Bank to end financial year 2009-10 with a bang on the retail loans front. While it witnessed record loan disbursement during the January-March quarter as well as the month of March, its loan portfolio grew 25 per cent over the entire financial year.
“We disbursed around Rs 3,500 crore in February 2010 and Rs 4,000 crore in March 2010, which are the highest ever (figures) for the bank,” said Pralay Mondal, country head, retail assets and credit cards, HDFC Bank.
“While the branch network for the bank doubled over the past three to four years, all loan segments—home, auto, personal loan and credit cards—did well for us.”
The rise in the demand for homes and automobiles, and the overall consumer confidence has led to this growth in the loan disbursements, which went through a trough in financial year 2008-09 as a result of the global financial crisis, liquidity problems and weak consumer sentiment.
Along with growth, HDFC Bank saw its market share rise in the unsecured segment.
“In the unsecured segment we grew not because the market grew but because less players were interested in this business and we continued with what we were doing earlier,” said Mondal.
In the automobile segment, the bank has the largest portfolio and disbursed close to Rs 1,300 crore in March 2010.
“The demand grew both for passenger cars and commercial vehicles and our strong relationship with manufacturers and dealers helped us grow,” said Mondal.
“While the A&B segment brought the volumes, the premium segment at the top of the pyramid is also getting filled now.” While continuing with growth in its retail loan portfolio, the bank also maintained its margins at levels of around 4 per cent and the current and savings account ratio stands close to 49 per cent of the total funds.
The bank also says the new interest rate payment system on savings accounts will not impact its margins much.
“Technically the impact of the new interest payment will be 10-15 basis points (100 basis points make 1 percentage point) on CASA and an overall impact of 5 basis points on the total cost of funds, which is minimal,” said Mondal.