HDFC Bank jumps 4% after lowering savings account interest rate by 25 bps

HDFC Bank stock was trading at ₹1.869.20, up 3.45 per cent from Friday's close of ₹1,806.75 on the National Stock Exchange

HDFC Bank share price: Shares of HDFC Bank surged nearly 4 per cent to hit an intraday high of ₹1,876.80 after the private lender lowered its savings account interest rate to 2.75 per cent for balances below ₹50 lakh, the lowest among large private sector banks.

 

The bank has reduced the rates by 25 basis points (bps), effective April 12. In addition, the bank has reduced the interest rates to 3.25 per cent from 3.5 per cent for balances above ₹50 lakh. The decision comes after the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) cut the repo rate by 25 bps to 6 per cent on April 9. 

 

Savings account interest rate refers to the interest that the bank pays customers on their funds based on their daily closing balance. The accumulated interest is credited to the customer's account on a monthly or quarterly basis, as per the respective bank’s discretion. 

 

At 10:52 AM, the stock was trading at ₹1.869.20, up 3.45 per cent from Friday’s close of ₹1,806.75 on the National Stock Exchange (NSE). In comparison, the benchmark NSE Nifty50 index was trading at 23,308.05, up 479.50 points or 2.1 per cent. The company’s total market capitalisation stood at ₹14.30 trillion. 

 

The stock is trading close to its 52-week high of ₹1,880, which it touched on December 9, 2024. On a year-to-date basis, the stock has jumped nearly 6 per cent compared to around 1.1 per cent fall in the Nifty50 index.   READ | Key Reasons Why Indian Stock Markets are rising today

 

HDFC Bank Q4 Preview

In its quarterly preview on banking and financial services companies, Elara Capital expects the loan growth momentum to remain softer for HDFC Bank

 

"The key factor to watch will be deposit traction and the composition in the form of 'retail and others'. We expect the credit-deposit (CD) ratio to decline within 94-95 per cent levels," the brokerage said.

 

In addition, net interest margins (NIMs) are expected to remain largely stable. However, the interplay between the loan-deposit ratio (LDR), liquidity coverage ratio (LCR), and NIMs will be a key factor to watch. 

 

On the asset quality front, Elara expects another steady quarter with controlled slippages as Q3 had already witnessed a higher base due to the Kisan Credit Card (KCC) seasonality. The brokerage believes commentary on growth outcomes and NIMs will be the primary focus post-results.