HDFC Bank's Latest Earnings Call: Stability in Credit and Margins Amid Merger Challenges

Stable Credit Environment and Risk Management:
- HDFC Bank reported stable credit parameters such as slippages and gross NPAs, with slippages impacted by seasonal factors in the agri sector.
- The stability in credit performance is attributed to strong credit risk assessment, collection analytics, and conservative lending practices.

Deposit Growth and Market Share:
- The bank experienced robust deposit growth of approximately 16%, gaining market share against a tight liquidity environment.
- The growth was due to strategic product offerings and maintaining a competitive funding strategy despite tight liquidity conditions.

Margins and Cost Efficiency:
- The bank's NIMs remained stable, despite tight liquidity conditions leading to a tight pricing environment.
- The cost-to-income ratio was maintained at around 40.5% through controlled spending and productivity gains, especially in technology investments.

Priority Sector Lending (PSL) and Compliance:
- HDFC Bank's priority sector lending has been stable at over 40%, but faces challenges meeting targets in specific segments like small and marginal farmers.
- The bank is pursuing various strategies, including organic growth and PTC investments, to meet the PSL requirements.

Merger Integration and Synergies:
- The merger with HDFC Limited has facilitated the opening of new liability accounts, with over 96% success for new mortgages and 1.9 million liability relationships opened.
- Despite challenges in realizing immediate synergies, the merger has provided a stable platform for potential future growth.