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Home loan business has become both an asset and liability generator for HDFC Bank with 80 per cent of incremental disbursals going to customers having a savings account with the country’s biggest private lender, said Arvind Kapil, Mortgage Head of HDFC Bank.
The CASA deposits of the bank grew by 2.2 per cent quarter on quarter (Q-o-Q) to Rs 8.35 trillion in the third quarter (Q3) of the current financial year (FY24) and the CASA ratio inched up to 37.7 per cent from 37.6 per cent in Q2 FY24.
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“Pre-merger, about 30 per cent to 35 per cent of incremental disbursals were to customers with an HDFC Bank savings account. This has reached about 80 per cent of incremental disbursals, post-merger,” Kapil said.
“The home loan business of the bank has become both an asset and liability generator and is growing sizeably. This leads to a higher stickiness quotient and a stronger customer connection with the bank for a longer duration,” he added.
The share of the bank has risen to 20 per cent in incremental disbursals post-merger. The lender also said it has recorded robust and consistent double-digit growth year on year (Y-o-Y) in home loans in the first six months after the merger.
Kapil said the bank has made 3.6 per cent sequential growth in the home loan segment in the quarter ending on December 31, 2023 to nearly Rs 6.84 trillion, which was claimed to be the highest among its banking peers engaged in the home loan business.
He said before the merger the focus was more on the salaried class of customers, but, now the targeting of the self-employed segment will also aid in increasing the opportunity for the lender.
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After the merger, the bank has launched and expanded its product basket through banking surrogates, as well as GST programmes for better assessment of such profiles, Kapil said.
The bank also plans to launch Home Refurbishment Loans in mid-March 2024 and a Home Saver Product by April 2024. It will convert all erstwhile HDFC’s service centers to branches in a phased manner and its entire mortgage team will also become relationship managers.
“We have a high retention rate of our employees from HDFC Ltd, post the merger,” Kapil noted.
HDFC Bank started to cross-sell its products through the service centers from February 1, 2024. As part of enhancing the cross-sell strategy, home loan customers can avail consumer durable loans, credit cards wealth advisory product, unsecured loans and home refurbishment loans.
