HDFC Bank Ltd.’s workforce declined by 3,343 employees in the last financial year as India’s largest private lender accelerated efforts to automate operations and redeploy staff to customer-facing roles.
The bank’s total staff fell to 211,178 as of March 31 from a year earlier, with new hiring dropping by 3,811, according to its annual report released on Saturday.
Of the total, non-supervisory employees — often classified as workmen or clerical and subordinate staff — decreased by more than 8,000 to 162,797, indicating a significant reduction may have come in operational and back-office roles.
The Mumbai-based lender’s shares fell as much as 1.7% in early Monday trade but then pared losses to edge down 0.5%. They have shed about 17% this year versus a 3% decline in the Nifty Bank index.
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“The price momentum in HDFC Bank is missing, largely weighed down by heavy selling by foreign investors and a weak broader market. This is why the stock is highly prone and volatile to any news point,” said Kranthi Bathini director - equity strategy at WealthMills Securities.
Banks globally, including in India, are increasingly using artificial intelligence and automation to streamline routine processes while redirecting employees to higher-value customer and advisory functions. Executives from JPMorgan Chase & Co., Citigroup Inc. and Standard Chartered Plc have warned that AI will eventually reduce the need for some roles while boosting productivity.
{{/usCountry}}Banks globally, including in India, are increasingly using artificial intelligence and automation to streamline routine processes while redirecting employees to higher-value customer and advisory functions. Executives from JPMorgan Chase & Co., Citigroup Inc. and Standard Chartered Plc have warned that AI will eventually reduce the need for some roles while boosting productivity.
{{/usCountry}}“As we accelerate the transformation toward becoming a technology-led, customer-centric bank, employees need to keep pace,” HDFC Bank Chief Executive Officer Sashidhar Jagdishan said in the annual report.
The lender’s middle- and junior-level headcount increased by 1,252 and 3,543, respectively, according to the annual report. There were 15 additions to the senior management.
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The bank, which counts foreign institutional investors among its major shareholders, plunged into a crisis in March after its part-time chairman, Atanu Chakraborty, stepped down abruptly, citing “certain happenings and practices” at the lender that were not in line with his “personal values and ethics.” His resignation triggered investor worries and wiped out billions of dollars from HDFC Bank’s market value.
HDFC Bank subsequently appointed domestic and international law firms to independently review governance concerns raised following Chakraborty’s resignation, and found no evidence to substantiate his allegations.
Jagdishan said Chakraborty’s resignation was a “challenging event” for the bank. “The board also constituted a special committee comprising solely of independent directors, to provide oversight on the legal review and ensure appropriate and timely flow of information between the bank and the law firms, in relation thereto,” Jagdishan said.