HDFC Bank board sets up oversight panel to monitor governance framework in subsidiaries

Mumbai: HDFC Bank chairman Atanu Chakraborty said the bank has strengthened governance frameworks across its key subsidiaries as it adapts to its expanded role as a financial conglomerate following the merger with HDFC Ltd.

“In order to address our enhanced stature as a financial conglomerate, we have strengthened our oversight on the group companies,” Chakraborty said in the bank’s FY25 annual report. These include HDB Financial Services, HDFC Life Insurance, HDFC Asset Management, HDFC ERGO General Insurance, and HDFC Securities.

A dedicated Group Oversight Department now monitors the implementation of the governance framework and reports to one of the executive directors. “This function also briefs the Board of Directors on critical updates, if any, regarding the group companies,” he added.

Four of these five subsidiaries—HDFC Life, HDFC AMC, HDFC ERGO, and HDB Financial Services—are now publicly listed. “The IPO [of HDB Financial Services] was successfully concluded in the first quarter of the current financial year,” the chairman said, calling it “another milestone for the group.”

HDFC Bank was designated a Domestic Systemically Important Bank (D-SIB) and recalibrated its internal systems accordingly. “We undertook a significant transformation of our compliance function, reinforcing our commitment to governance, transparency and regulatory excellence,” Chakraborty said.

FY25 marked the first full year of operations for the combined HDFC Bank-HDFC Ltd entity. “It now stands strengthened, much bigger in scale, broadened in capability and more unified in purpose,” he said. The merger brought together diverse businesses spanning life and general insurance, mutual funds, securities, and retail finance under one group.

On future prospects, the chairman said, “We are well positioned to take advantage of the realignments in international trade flows and supply chains that are now unfolding.” He added that India’s economy is likely to grow 6.5% or more, supported by stable macroeconomic policies, rural demand, and potential rate cuts.

The bank continues to invest in technology. “GenAI presents a generational transformation opportunity and responsibility,” Chakraborty said, while stressing the need for “appreciation of risk, reliability and information security.”

Net profit for FY25 rose 10.7% to Rs 67,347.4 crore, while gross NPAs were contained at 1.33%. A dividend of Rs 22 per share has been proposed. “The bank has a clear roadmap for growth anchored on values that have served the group well for over four decades,” he said.


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