SBI of India taking steps to counter impact of HDFC merger

State Bank of India (SBI) is cognisant of the competitive impact of the merger of Housing Development Finance Corporation (HDFC) into HDFC Bank and is gearing up to meet the challenge, chairman Dinesh Khara said at the bank’s 67th annual general meeting (AGM).

“SBI is the largest home loan provider in the country. Our home loan market share stands at 35.3% and we are very mindful of the HDFC-HDFC Bank merger and are taking necessary steps to counter the emerging competition,” Khara said in response to a question from a shareholder.

The addition of HDFC’s mortgage portfolio to HDFC Bank’s loan book could pose a challenge to SBI’s dominance in the home loan market. The value of SBI’s outstanding home loans stood at ₹5.62 trillion at end-March 2022. On a pro forma basis, HDFC Bank and HDFC had combined mortgages worth ₹5.9 trillion, based on end-December 2021 numbers.

SBI and HDFC Bank are the two largest banks in the country, in that order, and they have both underlined the importance of combining their brick-and-mortar presence along with digital capabilities to enhance their customer base. On Wednesday, Khara said SBI will focus on customer outreach through its physical branches as well as digital channels.