HDFC Bank in retail push

HDFC Bank is ramping up its retail banking business by widening its branch network and taking its retail products to a larger geographical area on the back of the substantial pick-up of demand in the retail sector.

The bank has also increased its profitability guidance to above 20-25 per cent.

"There is a substantial pick-up in demand. We want to take the loan products to a larger population. We are going to a much larger geographical area as we are increasing the organic growth rate," said HDFC Bank's managing director Aditya Puri.

By the end of this fiscal year, the bank will have around 300 branches from the existing 277.

It plans to open around 95-100 branches in the next fiscal year as against the earlier target of opening around 75 branches.

These new branches will be opened mostly in semi-urban areas.

Even as the corporate portfolio of the bank is growing at a rate of 10-15 per cent, the retail book is growing at around 40-50 per cent.

"The retail lending portfolio is growing by 40-50 per cent, the deposit products by 30-40 per cent and credit cards by over 100 per cent," said HDFC Bank's country head, retail banking, Neeraj Swaroop.

The balance sheet mix of corporate and retail is now at 68:32. However, this mix is changing and the incremental growth of corporate to retail is now at 45:55.

The bank had earlier issued a profit guidance of 20-25 per cent even as the net profit of the bank was steady at around 30 per cent.

"With the current macro-economic dynamics, we do not see a substantial downward bias in interest rates. We would be able to maintain the core income and normal trading profits and marginally increase the guidance," he said.

Puri was speaking at the launch of 'NetSafe', a value-added feature with credit and debit cards along with Visa International that enhances the security for on-line purchases.

This eliminates the need for disclosing the card number for shopping purposes.

Customers can create their own virtual card using their credit or debit card in the bank's web site. This card can be used by the customers while shopping.

The value of the card can be fixed as per the shopping requirement and the card will be valid for a maximum period of 48 hours, said HDFC Bank head, credit cards, Pralay Mondal.