Deepak Parekh to quit HDFC, says 'time to hang my boots'

HDFC chairman Deepak Parekh on Friday exuded confidence that the synergies between HDFC Bank and the group companies will deepen with the bank taking on the mantle of ownership of the group following the reverse merger likely to be effective from Saturday.

As chairman of HDFC Ltd, Parekh in the last message to the shareholders said home loans will now be complemented with HDFC Bank's core strengths -- its sales engine, execution capabilities at scale and deep insights on consumer behaviour.

The reverse merger of parent HDFC Ltd with HDFC Bank is expected to be effective from July 1.

"For HDFC Bank, a home loan customer marks the beginning of a journey of having a customer in perpetuity.

“HDFC Bank is excited at the prospect of cross-selling an array of asset and liability products to home loan customers.

“This will be done seamlessly on their digitalisation platforms – all through a one-click experience," he said.

HDFC Bank's vast distribution network will be better harnessed for both home loans and the group companies, he said.

"The confidence I derive is the agreed tenet of this integration --preserving the fabric of the ‘HDFC way of working'.

“This has also been publicly articulated by the leadership at HDFC Bank," he said.

What the future holds, only time will tell, he said, adding, the biggest risk organisations face today is staying with the status quo, believing what worked well yesterday will continue in the future.

Change takes courage as it displaces one from the cocoon of comfort and familiarity, he said.

Parekh said it is time for him to hang his boots and expressed hope for an exciting future and prosperity.

"It is my time to hang my boots with both anticipations and hopes for the future.

“While this will be my last communication to shareholders of HDFC, rest assured we now stride tall into a very exciting future of growth and prosperity," he said.

Parekh earlier this week had said that June 30 will be his last working day after spending 46 years at the Corporation and when asked what he will do after the board meeting, he jokingly quipped. "I will have a few drinks".

Observing that working on a merger of this scale has been challenging and rewarding, he said, "yet, what amazed us the most has been the immense goodwill and strong relationships that HDFC as a group has."

The approvals by the Competition Commission of India, the National Company Law Tribunal, the shareholders and the regulators were important merger milestones.

"In all our dealings pertaining to the merger, the HDFC group has been treated in a fair and just manner.

“We stand committed to adhering to the prerequisites as stipulated by the regulators, respecting the fact that these decisions are made keeping in mind the best interests of the Indian financial ecosystem," he said.

As HDFC hands the baton, he wished that the core founding values of kindness, fairness, efficiency and effectiveness gets woven deeper into the fabric of the HDFC group.

Termed as the biggest transaction in the history of India Inc, HDFC Bank on April 4, 2022, agreed to take over its parent, which is the largest pure-play mortgage lender, in a $40-billion all-stock deal, creating a financial services titan with a combined asset of over Rs 18 lakh crore.

The combined shares of the HDFC twins will have the highest weighting on the indices at close to 14 per cent, much higher than the present index heavyweight Reliance Industries with a 10.4 per cent weightage.

Once the deal is effective, HDFC Bank will be 100 per cent owned by public shareholders, and existing shareholders of HDFC will own 41 per cent of the bank.

Every HDFC shareholder will get 42 shares of HDFC Bank for every 25 shares they hold.