HDFC no
to universal banking
Our Banking Bureau
18 October 2001 Mumbai: HDFC has
said that it will not be opting for universal banking through a
merger with HDFC Bank.
HDFC managing director Keki Mistry said: “We do not see any
advantage in transforming ourselves into a universal bank. Both
HDFC and HDFC Bank are optimally staffed, hence there is no scope
for redeployment. Also, there is no excess real estate available.”
He also said that both
the organisations are growing at 30 per cent per annum and are
doing well in their respective niche areas. “If HDFC were to opt
for universal banking, it would face the danger of running into
asset-liability mismatch by channelling short-term funds from the
savings bank and current accounts into the housing sector, which
typically have longer tenors,” he  said.
Mistry also pointed out
that dealing with multiple regulatory bodies that govern the
banking, capital markets and insurance sector was another
impediment for conversion into a universal bank.
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