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What happens to customers, bank branches, employees after HDFC Bank-HDFC ltd merger? Check key points here

As of date, HDFC Bank has more than 68 million customers, 6,342 branches.

What happens to customers, bank branches, employees after HDFC Bank-HDFC ltd merger? Check key points here

New Delhi: India`s largest private lender HDFC Bank will merge with HDFC Ltd, the country`s largest housing finance company to create a financial services conglomerate. 

As part of the deal, shareholders of HDFC Ltd will receive 42 shares of the bank for 25 shares held. Existing shareholders of HDFC Ltd will own 41% of HDFC Bank. Shares held by the housing finance company in the lender will be extinguished, making HDFC Bank a full-fledged public company. (Also read: Google Maps to help you save money on toll prices --5 big points for Android and iOS users)

What happens to customers after the HDFC-HDFC Bank merger?

As of date, HDFC Bank has more than 68 million customers, 6,342 branches.

HDFC Bank has said that merger of India’s largest Housing Finance Company, HDFC Limited, with HDFC Bank, will enable seamless delivery of home loans and leverage on the large base of over 68 million customers of HDFC Bank and inter alia improve the pace of credit growth in the economy. (Also read: Petrol, diesel costlier by Rs 10/litre in last 16 days; CNG prices burning hole in pocket too –Check latest rates)

"Post the combination, HDFC Bank’s customers will be offered mortgages as a core product in a seamless manner. HDFC Bank will also leverage the long tenor mortgage relationship to offer varied credit and deposit products enabled through better insights through-out the customer life-cycle. This will result in an enhanced value proposition and customer experience for all customers of the combined entity," said the bank.

What happens to HDFC Ltd employees after the HDFC-HDFC Bank merger?

Shivaji Thapliyal, Lead Analyst – Institutional Equities, YES SECURITIES commenting on the Banking perspective of the HDFC-HDFC Bank merger said, "The jobs of HDFC Limited employees will remain protected."

What happens to HDFC Ltd branches after the HDFC-HDFC Bank merger?

Thapliyal added that the HDFC Limited branches will be retained but, at some point in the future, they could be converted to full-service bank branches.

Deepak Parekh, Chairman HDFC Limited, said, “This is a merger of equals. We believe that the housing finance business is poised to grow in leaps and bounds due to the implementation of RERA, infrastructure status to the housing sector, government initiatives like affordable housing for all, amongst others. Over the last few years, various regulations for banks and NBFCs have been harmonised, thereby enabling the potential merger. Further, the resulting larger balance sheet would allow underwriting of large ticket infrastructure loans, accelerate the pace of credit growth in the economy, boost affordable housing and increase the quantum of credit to the priority sector, including credit to the agriculture sector.”

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