Former HDFC chairman Deepak Parekh revealed that ex-ICICI Financial institution chief Chanda Kochhar as soon as made an audacious pitch, proposing a merger of the 2 monetary powerhouses nicely earlier than HDFC’s eventual union with its banking arm.
“I keep in mind you speaking to me as soon as. I keep in mind it very clearly. It’s by no means been talked about in public, however I’m keen to share it now,” Parekh advised Kochhar throughout a candid dialog on her channel.
“You stated that ICICI began HDFC. ‘Why don’t you come again house?’ That was your supply.” Parekh stated he turned it down, calling it “unfair” and “improper” given the model id and banking construction of HDFC.
The eventual HDFC-HDFC Financial institution merger, finalized in July 2023, was not born of company ambition however regulatory push, Parekh stated.
The Reserve Financial institution of India had reclassified massive NBFCs like HDFC—with property exceeding ₹5 lakh crore—as systemically vital, far above the ₹50,000-crore threshold.
“RBI supported us they usually pushed us into it to some extent, they usually helped us,” Parekh famous. Nonetheless, he emphasised, “there have been no concessions, no aid, no time, nothing.”
The deal was stored underneath extraordinary secrecy. “It was stored a secret. Nobody knew about it—when it hit the press within the morning, that’s when everybody came upon. The federal government was conscious as a result of RBI was in contact with them, and we stored it so shut—simply attorneys, due diligence, accountants,” he recalled.
For Parekh, the day the merger closed was each “a tragic day and a cheerful day.” Whereas it marked the tip of HDFC as a standalone entity, he stated the transfer was important for India to construct banks that may compete globally. “Have a look at how massive Chinese language banks are. Now we have to be larger, bigger in India.”
He warned that Indian banks might want to develop by way of acquisitions to remain aggressive. On broader macroeconomic considerations, Parekh cited ongoing provide chain disruptions, export instability, and shifting commerce insurance policies as key worries for CEOs.
He additionally didn’t mince phrases on the insurance coverage sector, calling it “the least understood product” and slamming banks for mis-selling insurance policies pushed by excessive upfront commissions.
