HDFC Bank Full Form Name: HDFC Meaning
Full
Form of HDFC:
Housing
Development Finance Corporation
HDFC
Full Form is Housing Development Finance
Corporation. Better known as HDFC is a leading Indian private sector bank.
It was promoted by Housing Development Finance Corporation. This bank is very
popular and trustworthy among Indian people who use banking services. HDFC is
the leading private sector bank of India and 45th on the list of 50 banks in
the world in terms of market capitalization.
The
bank was incorporated in 1994. Headquartered in India, HDFC has numerous
branches across India. So, the availability of HDFC is also outstanding. It
provides its customers with a number of products and variety in the range of
its services. HDFC is one of the most trustworthy brands in terms of NRI
Banking, Wholesale Banking, Retail Banking, Treasury and much more. All
branches of HDFC are linked online on real time basis.
It
has two subsidiaries namely HDFC Financial Services Limited which deals with
retail asset financing and HDFC Securities Limited which is known for its
active engagement in stock broking. It has gained a number of awards and
recognitions over the years from across the globe. The variety of its services,
its trustworthy strategies, customer-oriented business policies and its
availability have made HDFC the fifth largest bank in India in terms of
measured assets.
HDFC
Full Form – Additional Information
As
our subject of discussion, we have Housing Development Finance Corporation
(also known by its abbreviated form HDFC) as our topic. Housing Development
Finance Corporation, hereinafter referred to as HDFC, is a big name in the
Indian market relating to finance and we shall see what is there to know about
this entity. HDFC is a giant financial conglomerate based in India. It is
headquartered in Mumbai, India and was established way back in the year 1977.
HDFC
is, and for a long time, a major finance provider in the country and has earned
public and professional acclaim for many years. The financial conglomerate
marks its presences in various sectors relating to finances such as insurance,
banking, education loans, management of assets, and venture capital. We shall
explore more about HDFC in the forthcoming paragraphs, which elaborate upon
some important aspects of the conglomerate in a more lucid manner. Here are
certain things you must know about HDFC.
History
behind the foundation of HDFC, the giant financial conglomerate
We
shall begin with certain historical facts that have contributed to the
establishment of such a big brand in the country. When we brief ourselves with
historical facts, we shall be able to fully prepare ourselves for more
complicated or rather other aspects about the conglomerate. So under this head,
we shall begin with the most important aspect, the history.
The
HDFC was founded in, as mentioned before, the year 1977. In the year 1977, the
conglomerate began as a merely specialized mortgage company and it was first of
its kind in India. The Industrial Credit and Investment Corporation of India
was a nodal agency that promoted HDFC in its formative years. Throughout the
formative years and even after, Hasmukhbhai Parekh played a prominent role in
the development and promotion of the company.
In
the year 2000, various mutual fund schemes were launched by the HDFC Asset
Management Company. An important event occurred in the same year as Insurance
Regulatory and Development Authority (abbreviated as IRDA) of India allowed
registration to HDFC Standard Life Insurance.
This
marked the launch of the country’s first ever private life insurance company.
This, in a nutshell, apprises the readers about the journey that HDFC has made.
This discussion is brief but highlights some important events that caused the
rise of the country’s one of the biggest private financial conglomerates.
Products
and Services by HDFC
This
is an important segment, which shall highlight the outreach of the HDFC in
terms of products and services it has to offer to several institutions and
common public. Some of the products and services offered by HDFC are:
- Mortgages: Of course, HDFC began as a specialized mortgage
company and thus, this service should be the first for this discussion.
The company is engaged in providing finance facilities to common public
and institutions, which are involved in the construction of buildings
meant for residential purposes. HDFC is currently the biggest provider of
home loans in the country. An Annual Report was published by the company
for the year 2012-13 in which it claimed to have disbursed about Rs.
456,000 crores in 35 years of business and has reached out to about 4.4.
housing units.
- Life Insurance: As mentioned earlier, HDFC has been granted
registration to carry out insurance business. Since the year 2000, the
company has been engaged in such activities. It is undertaking all of
these activities through its HDFC Standard Life Insurance Company Ltd.
This subsidiary has in its kitty 22 individual products and about 8 group
products. It also offers customized products as well. Currently, the
subsidiary has its operations in about 451 offices and serves about 965
locations. As far as the statistics of the year 2013 are concerned, the
HDFC’s life insurance business amounts to 4.6 percent share in the market.
- General Insurance: It is another service provided by HDFC. The company
provides general insurance for health, travel, home and personal accident.
This accounts for total 47 percent of the total business in the general
insurance sector. The subsidiary also provides general insurance in
marine, property, aviation, and other segments of corporates.
- Mutual funds: In 2000, the HDFC came up with various mutual funds
scheme. All these schemes are made available through its subsidiary HDFC
Asset Management Company Ltd. It is one of the major businesses of the
HDFC as its has average Assets Under Management (abbreviated as AUM)
amounting to trillions.
Key
subsidiaries and associates of HDFC
In
the preceding paragraphs, many subsidiaries have been mentioned. Under this
segment, we shall elaborate a little on some of the subsidiaries and associates
operational under the aegis of HDFC. Some of the major associates and
subsidiaries of the HDFC include HDFC ERGO General Insurance Company Limited,
GRUH Finance Limited, its HDFC Standard Life Insurance Company Ltd, HDFC
Venture Capital Limited., HDFC Asset Management Company Limited, Credila
Financial Services Private Limited, HDFC Bank Limited, etc.
- HDFC ERGO General Insurance
Company Limited: This was formed with the ERGO
Insurance Company. In this, ERGO Insurance Company holds about 26 percent
whereas the HDFC General Insurance Company Limited 74 percent shares.
- GRUH Finance Limited: It is another functionary within the HDFC group. In
GRUH, the HDFC holds about 50 percent shares. GRUH Finance Limited is a
housing finance company that provides loans to common public for works
such as renovation, construction, and purchase of residential houses. It
also facilitates loans in cases of self-employed segments. It has a
network of 136 retail offices across seven states in the country.
- HDFC Standard Life Insurance
Company Ltd: In association with Standard
Life, HDFC Standard Life Insurance Company Ltd provides private life
insurance in the country. In this, the HDFC holds about 72 percent shares
whereas Standard Life holds about 26 percent shares. HDFC Standard Life
Insurance Company Ltd ranks third in terms of market share of private
companies engaged in providing life insurance facilities in the country.
Thus, it is a big name in the country.
- HDFC Bank Limited: In HDFC Bank, HDFC holds approximately 22.8 percent
shares. The focus zones of HDFC Bank Limited are retail and wholesale
banking services and undertaking treasury operations. It is the country’s
seventh-biggest publicly traded company.
- HDFC Asset Management Company
Limited: The HDFC Asset Management
Company Limited was founded with Standard Life has the key investor. HDFC
holds 60 percent shares in this association. It undertakes the management
of 44 schemes and these schemes compose of equity exchange and debt, etc.
HDFC Asset Management Company Limited is ranked first as far as Average
Assets Under Management (AUM) is concerned.
- Credila Financial Services
Private Limited: It is a nonbanking company
undertaking financing. It is the country’s first ever that focused purely
on grant of education loans. This company provides loans for undergraduate
and post graduate students studying in India or in any foreign
destination. (8 percent shares in the company are held by HDFC.
Awards
and recognition achieved by HDFC
It
can be easily inferred that HDFC has played a key role in the development of
private financing system in the country and this has been acknowledged by many.
HDFC group has received many awards and recognition for its many contributions.
In
the year 2013, HDFC’s Board of Directors was listed as one of the best five
boards in the country. Forbes has listed HDFC on the rank 561 in its Global
2000 list of companies in the year 2013. HDFC has also been recognized as one
of the best companies to work and recognition by Economic Times and The Great
Place To Work Institute is a proof. Its subsidiaries and associates have
garnered much national and international attention too thus making HDFC as one
of the most successful financial conglomerate in the country and beyond. If one
reads about its associates and their recognition, one will understand it well.
Full
Form of HDFC – Important information
HDFC
Bank – Housing Development Finance Corporation Bank
We
have for our discussion one of the country’s most prominent private banks in
the country, which has successfully managed to secure a strong place in the
foreign banking market. We are talking about Housing Development Finance
Corporation Bank, which is known popularly by its abbreviated form HDFC Bank.
In this segment, we shall discuss various aspects about HDFC and what makes it
one of the most credible private banks in the country. However, before we
engage ourselves in those aspects, let us discuss about HDFC.
Housing
Development Finance Corporation Bank hereinafter will be referred to as HDFC Bank
throughout the article, is a banking and financing service providing company in
India. The bank is headquartered in Mumbai, India. The Bank, which was
incorporated in the year 1994, is the biggest bank in the country as far as
market capitalization is concerned in the year 2016. In terms of assets, HDFC
Bank is the second biggest private bank in the country.
What
more, the Bank has been listed at 58th position in the list of
India’s most trusted Band produced by Brand Trust report in the year 2015. HDFC
Bank has garnered international recognition too with it being listed in top 50
global banks in respect of market capitalization. The net revenues of the bank
have increased by 20.7 percent as of December 2015 is concerned.
The
current Managing Director of the HDFC Bank is Aditya Puri and he has held this
position ever since the incorporation of the Bank in the year 1994. He has been
named in the list of 30 best CEO’s and business leaders produced by AIMA. Now
that we have briefly discussed about the Bank, we shall now move our attention
towards various aspects of the Bank.
History
behind the establishment and development of the Bank
Let
us begin with the history behind the establishment and development of the bank,
which ultimately went on to become the country’s most prominent private bank.
As mentioned before, the bank was incorporated in the year 1994. The registered
office was Mumbai, India. It was incorporated under the name HDFC Bank Limited
and began its operations as a Scheduled Commercial Bank in the year 1995 after
having received a licence to provide banking services. In the formative years,
the bank engaged itself with National Westminster Bank Group.
Eventually,
the Housing Development Finance Corporation, which is a major housing financing
company in the country promoted the HDFC Bank. It was HDFC only which was the
first to receive a positive response from the nodal Bank of the country,
Reserve Bank of India (abbreviated as RBI), to establish a private bank. In the
year 1995, the Bank launched its Initial Public Offering (abbreviated as IPO)
and went public.
Acquisition
credited to HDFC
HDFC
gradually expanded through various acquisitions that it undertook. This created
a strong identity of HDFC Bank in the financial market. Under this segment, we
shall explore important acquisitions undertaken by HDFC, which is essentially
two in number.
The
first acquisition we shall discuss is that of the Times Bank, which was merged
with the HDFC Bank Ltd. in the year 2000. It was a major merger as the Times
Bank was promoted by famous Bennett, Coleman & Co. This was the first ever
merger between two private banks belonging to the New Generation Private Sector
Banks category and thus holds significance. The scheme of amalgamation provided
that the Times Bank would receive one share of the HDFC Bank for each 5.75
shares of the Time Bank.
The
second acquisition that we shall discuss is that of Centurion Bank of Punjab.
The acquisition happened in the year 2008. The Board of HDFC Bank Limited
agreed on the acquisition of the Centurion Bank of Punjab for the huge sum of
Rs. 9,510 crores and this has made it one of the largest acquisitions in the
financial market of the country. The scheme of amalgamation provided that the
Centurion Bank of Punjab would obtain 1 share of the HDFC Bank for every
twenty-nine shares of the Centurion Bank of Punjab. These two aforementioned
acquisitions have become one of the key mergers to have happened in the Indian
financial market and these mergers are essentially responsible for the rise of
the HDFC Bank in the market.
Products
and services provided by HDFC Bank Limited.
There
is a big range of financing and banking services that HDFC Bank Limited
provides to its customers, both common public and institutions. This segment
shall elaborate upon some of the products and services offered by the bank.
- Wholesale Banking services: The Bank provides for a range of wholesale banking
facilities which include trade services, management of cash, etc to
several small and moderate sized corporations and those businesses which
are based on agriculture.
- Retail Banking Services: The Bank is known to be the first bank in the country
that came up with the service of International Debit card. It came up with
this service in association with VISA. Apart from this, the bank also
issues to its customers Maestro Debit Cards. In the year 2001, the bank
launched credit card services.
- Treasury operations: Currently, the bank provides three main product areas
namely, Equities, Local Currency Money Market & Debt Securities, and
Foreign Exchange. All these services are provided to the customers through
the treasury team under the HDFC Bank Limited. It is this treasury team
that is responsible for overseeing the management of returns and market
risks.
Operations
of HDFC Bank Limited
As
of the year 2016, the Bank operates a network of 4281 branches situated across
2505 cities in the country. The Bank also has branches operating in overseas
markets such as Dubai, Hong Kong, and Bahrain. The Bank operates two major
subsidiaries that undertake important services namely, HDB Financial Services
Limited (abbreviated as HDBFS) and HDFC Securities Limited (abbreviated as
HSL).
- HDB Financial Services Limited: This subsidiary is involved in retail asset
financing. It serves as Non-Bank Finance Company (Abbreviated as NBFC).
The subsidiary grants individual loans as well loans to enterprises
(small, medium and large). The subsidiary is promoted by the HDFC Bank
Limited, in which the latter has 97.42 percent as of the year 2012. The
HDBFS operates about 425 branches in across 265 cities, as per records of
the year 2015 are concerned.
- HDFC Securities :Limited (HSL): This subsidiary is engaged in the
business of stock broking. In this subsidiary, the HDFC Bank holds 89.24
percent.
Initiatives
undertaken by the HDFC Bank Limited as a part of Corporate Social
Responsibility (abbreviated as CSR)
HDFC
Bank has undertaken many CSR activities and some of them have been mentioned in
the following paragraphs.
- Sustainable Livelihood: It is an initiative that aims at providing finance
for livelihood to ensure empowerment of people belonging to rural areas.
The focus is on providing training sessions to people in areas relating to
credit Counseling Market linkages, etc. The initiative is stated to have
reached about 20 lacs beneficiaries.
- Education: It is yet another initiative wherein it conducts
Galli School Project. In this project, family based, literary programs are
organized. The project has participated in about 600 schools across Andhra
Pradesh and Orissa.
- Go Green: This initiative is aimed at investing the development
of a greener environment. In this, the company promotes multi-channel
delivery mechanisms such as Mobiles, ATM transactions, etc. It also
focuses on the development of green buildings.
- Training: In this, the company organizes many skill development
courses for youths such as basic computer skills, and other vocational
programs. The project is slated to have reached about 1500 youths in the
country.