Nov 28, 2011, 06.17 PM IST | Source: CNBC-TV18

HDFC Bank confident of maintaining margins of 3.9-4.2%

Aditya Puri, managing director and chief executive officer of HDFC Bank speaks to CNBC-TV18 about a whole range of topics such as lending to power, infra and MFIs, interest rate peaking and Basel III. Check it out!

HDFC Bank confident of maintaining margins of 3.9-4.2%

Aditya Puri, managing director and chief executive officer of HDFC Bank tells CNBC-TV18 that any pressure on margins going ahead will be temporary and the bank will be able to maintain it in the range of 3.9-4.2%. Let us understand that the interest rate cycle has peaked and as the interest rates come down, margin should improve, he says.

Speaking to the channel, he says that power sector, infrastructure and real estate has got very little to do with the slowing of the economy. So people who have lent to projects which have issues with either power supply or distribution will probably have to restructure them, he says. However, Puri does not see this resulting in too much of a loss because there is demand for power in the country. They will, nonetheless, need restructuring, he says.

On lending to microfinance institutions, Puri says that some write-off will be required and HDFC Bank has provided for it.

Puri is confident that Basel III will not affect HDFC Bank. We are largely compliant, our capital adequacy as of now is 16.4% out of which tier I is 11.5% plus; most of our deposits are customer deposits and we are provisioned to the extent of 100%, he says. He says that the bank will not need capital for more than the next two years.

HDFC Bank stock price

On April 17, 2014, HDFC Bank closed at Rs 718.55, down Rs 6.7, or 0.92 percent. The 52-week high of the share was Rs 760.50 and the 52-week low was Rs 528.00.


The company's trailing 12-month (TTM) EPS was at Rs 33.52 per share as per the quarter ended December 2013. The stock's price-to-earnings (P/E) ratio was 21.44. The latest book value of the company is Rs 150.97 per share. At current value, the price-to-book value of the company is 4.76.

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