HDFC Bank Ltd., one of the world's largest banks, is making strategic changes to its top management as it aims to expand its mortgage business. This comes three months after the bank acquired Housing Development Finance Corp (HDFC) in July 2023, a move that has seen the lender's shares come under pressure.
In an employee memo sent on Sunday, the bank outlined plans to bring information technology and digital functions under CEO Sashidhar Jagdishan. The move, led by Ramesh Lakshminarayanan, is designed to leverage technology to offer more products and services across its branches.
Ashish Parthasarthy, a veteran of the bank who has led the treasury since 2009, will take over responsibility for the key retail branch business, which handles deposits and product distribution. Under his leadership, HDFC Bank plans to split the geographical management of the retail branch business to handle expansion and product plans in a more structured manner. This initiative will be co-led by Smita Bhagat and Sampath Kumar.
Bhagat, one of the senior women leaders at HDFC Bank, previously served as the group head for government and institutional business, ecosystem banking, inclusive banking, and startups. Kumar was the group head of liability products, third-party products and non-resident business at the bank.
The bank also announced other key changes in its management structure. Arvind Vohra, who previously led the retail branch business, will now oversee the bank's retail assets excluding mortgages. The mortgages division will be helmed by Arvind Kapil. Parag Rao will lead product liabilities as well as product management, including marketing. Rakesh Singh will continue to lead investment banking and private banking but will now also have additional responsibility for offshore international business.
These changes follow HDFC's acquisition of the country's largest mortgage lender in April 2023, a deal valued at about $60 billion. The merger, which created a banking entity with a combined market value of almost $190 billion, was part of a broader strategy to capitalize on a boom in home loans and consumer spending in India, the world's fastest-growing major economy.
The acquisition also came in response to a proposal by the banking regulator for large non-banking finance companies to convert into banks. This move aimed to prevent a recurrence of the country's massive shadow lending crisis in 2018. However, since the takeover, HDFC Bank faced a rare downgrade from Nomura Holdings (NYSE:NMR) Inc. last month, citing concerns over the bank's return on assets and pressures on loan growth.
HDFC Bank did not immediately respond to a request seeking comment on these changes.
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