HDFC Bank announces 1500 Cr. Ex-gratia payment to staff

HDFC Bank announces 1500 Cr. Ex-gratia payment to staff

As a token of appreciation for the hard work during the merger of HDFC Bank with HDFC Ltd, the HDFC bank has announced anone time ex-gratia payment of around Rs 1,500 crore to its staff as per media reports.

HDFC Bank  reported a 37% year-on-year increase in net profit to Rs 16,512 crore in the fourth quarter of the previous financial year. However, net profit grew by only 0.84% on a quarter-on-quarter basis, impacted by a floating provision of Rs 10,900 crore during the fourth quarter.

“We are not a quantity player for liabilities or assets. Our focus is on quality, which is a balance between risk and margins. We have demonstrated that whenever there are any adverse or early indicators on the risk side, we tend to grow slow,” said Jagdishan.

“If there is heightened competition or irrational competition both on the liabilities and assets side, we are happy to give up that kind of a share. We’re happy to grow slowly.”

“To achieve that the key is to ensure the most important focus is the sustainability of our deposit franchise, especially the retail deposit franchise,” Jagdishan said.

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“Key to sustainable momentum is our enhanced customer engagement and elevated service-first culture,” he stated.

Regarding the rationale behind the ex-gratia payment of around Rs 1,500 crore for staff, he said the team’s hard work during the merger and subsequent challenges, aiming to motivate them to stay with the bank amid high attrition rates in recent years.

“There was a lot of hard work that happened in the run-up to the merger and subsequent to that on a much larger balance sheet and led by a complex and adverse liquidity situation in the system. I think the team has rallied to adjust to the new norms; they worked hard after being battered from all fronts at the ground level,” Jagdishan said. “It is our endeavour to ensure that the large ground workforce, which is 90% of our total manpower, is motivated and this is a way of trying to say thank you to them,” he said.

He clarified that was a one-time ex-gratia that the bank has provided for after getting a one-off gain from its stake sale in its education subsidiary HDFC Credila.

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