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HDFC Bank’s Rs 1,500 crore ex-gratia a gesture of employee appreciation |


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Sashidhar Jagdishan, MD And CEO Of HDFC Bank

Sashidhar Jagdishan, MD And CEO Of HDFC Bank

Following an impressive Q4FY24 performance, HDFC Bank announced an ex-gratia payment of around Rs 1,500 crore to its staff. The bank’s decision came as a gesture of appreciation for the employees’ dedication during the merger with HDFC Ltd as well as address attrition, said Sashidhar Jagdishan, the managing director & chief executive of the largest private sector lender.

The lender, which announced its January-March earnings on Saturday, reported a 37.1 per cent growth in net profit, boosted by a one-time gain from selling a majority stake in HDFC Credila – an education loan company. At the same time, the bank decided to make floating provisions to Rs 10,900 crore, which nullified the impact of the stake sale gain.

“There was a lot of hard work that happened in the run-up to the merger and subsequent to that on a much larger balance sheet and led by a complex and adverse liquidity situation in the system. I think the team has rallied to adjust to the new norms; they worked hard after being battered from all fronts at the ground level,” Jagdishan said during an analyst call.

“In the last couple of years, we have had heightened attrition as well. We endeavour to ensure that our large ground workforce, which is 90 per cent of our total manpower, is motivated and this is a way of trying to say thank you to them,” he said.

Q4 turnaround

The lender, which faced heat from investors after their third-quarter earnings for poor show on deposit mobilisation, produced a much better performance in the fourth quarter. The bank mobilised Rs 1.66 trillion in deposits in the January-March period, of which retail deposits were Rs 1.29 trillion. As a result, the bank has gained market share in deposits in the fourth quarter.

“Ever since our famous – you may call it infamous – third-quarter results earnings call, we have received a lot of feedback from several of you. With all humility, we have incorporated many of the feedback,” Jagdishan said.

He reminded that deposit flows are typically higher in the January-March period and some of the flows were transitory, unexpected during the period. “While the fourth-quarter mobilisation is healthy, I must upfront tell you that there are some transitory flows that have come in which is more than what we have anticipated. Even adjusting for that, retail growth was rather healthy,” he said.

“Will I be able to maintain this kind of momentum? If we take a long-term average of six years or so, there is a certain proportion of total deposits that come in the first quarter, which is probably the lowest proportion. The second and third quarters are more similar in terms of proportion, and the largest part of the proportion comes in the fourth quarter,” Jagdishan said.

He said the bank has to improve on customer service to keep up the good show on…



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