Investor Presentation

Contents

Well positioned across Indias GDP spectrum

Meeting Diverse Customers Needs
Unique Franchise in the Indian Banking Sector
Key Business Initiatives

Financial Highlights
Value Proposition

Well positioned across GDP spectrum

India GDP*

`. Tn

Private Consumption
Well positioned in urban and rural markets
Leading player across retail loan categories
Focus on working capital finance and trade services

120
90
60
30
0

FY 2012

FY 2013

Private consumption
Government
Investment

FY 2014

Government
Large tax collector for the Government of India
Significant provider of cash management services for public
sector and semi government undertakings

Investment
Term Loans for brown field and green field capex
Debt syndication Amongst the top 5 players in industry
Project financing to strong and established players
Leading working capital banker to capital goods
manufacturers

*Source CSO (GDP at Market Prices at current prices, FY 2014 data is advance estimates)
FY Fiscal year ended March 31
` - Rupees
2

Contents

Well positioned across GDP spectrum

Meeting Diverse Customers Needs
Unique Franchise in the Indian Banking Sector
Key Business Initiatives

Financial Highlights
Value Proposition

Wide Range of Products and Customer Segments

Retail
Banking

Wholesale
Banking

Treasury

Loan Products:

Deposit Products:

Other Products / Services:

Auto Loans
Personal Loans
Home Loans / Mortgages
Commercial Vehicles Finance
Retail Business Banking
Credit Cards
Loans against Gold
2-Wheeler /Consumer Durable Loans
Construction Equipment Finance
Loans against Securities
Agri and Tractor loans
Education Loans

Savings Accounts
Current Accounts
Fixed / Recurring Deposits
Corporate Salary Accounts

Depository Accounts
Mutual Fund Sales
Private Banking
Insurance Sales (Life, General)
NRI Services
Bill Payment Services
POS Terminals
Debit Cards
Foreign Exchange Services
Broking (HDFC Securities Ltd)

Loan products contd

Self Help Group Loans

Joint Liability Group Loans
Kisan Gold Card

Commercial Banking:

Transactional Banking:

Investment Banking:

Key Segments:

Working Capital
Term Loans
Bill / Invoice discounting
Forex & Derivatives
Wholesale Deposits
Letters of Credit
Guarantees

Cash Management
Custodial Services
Clearing Bank Services
Correspondent Banking
Tax Collections
Banker to Public Issues

Debt Capital Markets

Equity Capital Markets
Project Finance
M&A and Advisory

Large Corporate
Emerging Corporates
Financial Institutions
Government / PSUs
Business Banking / SME
Supply Chain (Suppliers and Dealers)
Agriculture
Commodities

Products / Segments:

Other Functions:

Foreign Exchange
Debt Securities
Derivatives
Equities

Asset Liability Management

Statutory Reserve Management

Complete Suite of Products to Meet Diverse Customers Needs

Business Mix
Total Deposits

Gross Advances

Profit Before Tax

`. Bn

`. Bn

`. Bn

3,700

3,100

140

1,850

1,550

70

0
2012

Retail

2013

2014

Wholesale

0
2012

Retail

2013

2014

2012

Wholesale

Over 90% of net revenues from customer segments

Large retail deposit franchise a source of stable funding

Well balanced loan mix between wholesale and retail segments

Equally well positioned to grow both segments

Retail

2013

2014

Wholesale

Indian GAAP figures. Fiscal Year ended 31st March; ` - Rupees

Gross advances and Profit Before Taxes classified as per RBI guidelines for segmental reporting (Basel II).
Other Banking Operations Segment (which includes Credit Cards, Third Party Product sales etc.) has been added to the Retail Segment
5

Contents

Well positioned across GDP spectrum

Meeting Diverse Customers Needs
Unique Franchise in the Indian Banking Sector
Key Business Initiatives

Financial Highlights
Value Proposition

Strong National Network

Mar 11 Mar 12 Mar 13 Mar 14

Branches

1,986 2,544 3,062 3,403

ATMs

5,471 8,913 10,743 11,256

Cities / Towns

996

1,399 1,845 2,171

Branch classification
Mar 11

Mar '14

Semi
Urban
31%
Urban
28%

Semi
Urban
34%
Rural
9%

Metro
32%

Urban
21%

Rural
22%

Metro
23%

All branches linked online, real time

55% of total branches (40% in Mar 11) in Semiurban and Rural locations
Customer base of over 28 million, new
customer acquisition of 3 million in FY 2014
FY Fiscal year ended March 31

High Quality Deposit Franchise

Total Deposits

Core CASA Ratio

Average Saving Balance per Account

`.

`. Bn
3,700

52%

52,000

1,850

26%

26,000

0%
2012

Time

2013

2014

Savings

Current

2012

2013

Savings

2014

0
2012

2013

2014

Current

Healthy proportion of CASA (current & savings) deposits

Floats from multiple transactional banking franchises

Provides customer base for ongoing cross-sell through branches

Raised US$ 3.4 billion FCNR deposits and swapped into rupees at a concessional rate
with RBI in November 2013

Indian GAAP figures. Fiscal year ended 31st March; FCNR Foreign Currency Non-Resident
Core CASA ratio based on daily average balances for the year

` - Rupees
8

Low Funding Costs Healthy Margins

Cost of Deposits
7.00%

5.72%

6.13%

Net Interest Margin

6.00%

5.97%

3.50%

4.43%

4.47%

4.37%

2012

2013

2014

3.00%

0.00%

0.00%
2012

2013

2014

Amongst the lowest deposit costs in the industry

Healthy margins relatively stable across interest rate and economic cycles

Average yields supported by higher proportion & product mix of retail loans

Indian GAAP figures. Fiscal year ended 31st March

Strong Non-Funded Revenues

`. Mn
80,000

Multiple sources of fees &

commissions:

70,000
60,000
50,000
Fees & Commission
40,000
Fx & Derivatives

30,000

Recoveries*

20,000

P/L on Investments

10,000
0
FY 2012

FY 2013

Banking charges (Retail & Wholesale)

Retail Asset Fees
Credit card Fees
Third party product sales
Cash management
Trade Finance
Depositary charges
Custody

FY 2014

-10,000

Other Income (non-fund revenues) at 30% of Net Revenues in FY 2014

Composition of Other Income in FY 2014:

Fees and commission 72%,

FX and Derivatives Revenues 18%,
Recoveries from written-off accounts 9%,
Profit / Loss on sale of Investments 1%

Indian GAAP figures ; FY - Fiscal Year ended 31st March.

* Recoveries includes miscellaneous income

` - Rupees
10

Leveraging Technology
Multiple Delivery Channels

Greater Choice and Convenience for Our Retail

Customers
2014

2004
Branches
15%
Branches
27%

ATM
53%

ATM
25%

Phone Banking
5%

Phone Banking
10%
Internet & Mobile
55%

Internet & Mobile

10%

% Customer Initiated Transactions by Channel

Central / Regional Processing Units

Economies of Scale; Branch focus: Sales & Service

Electronic Straight Through Processing

Lower Transaction Costs & Error Rates

Data Warehousing, CRM, Analytics

Higher Sales & Credit Efficiencies, Cross-sell

Innovative Technology Applications

Enable new Products / Channels including Apps

The charts above cover only transactions initiated by our own customers at our channels and which could have been transacted at the Banks branches.

Transactions such as (a) SMS alerts sent to customers, (b) point of sale (POS) transactions, and (c) transactions by holders of other
banks cardholders have therefore been excluded. Apps include Micro/Lite App, Smart Phone App and Tablet App
11

Healthy Asset Quality

NPA% to Advances

Loan Loss Provisions

`. Bn
35

2%

1.02%

0.98%

0.97%

1%

0.20%

0.18%

18

0.27%
0

0%

2012

2013

Gross NPA %

2014

Net NPA %

2012

Gross NPAs

2013

Specific Provision

2014

General Provision

Amongst the best portfolio quality (wholesale & retail) in the industry

Strong credit culture, policies, processes

Specific provision cover at 73% of NPAs, total coverage ratio over 100%

Restructured loans at 0.2% of the Bank's gross advances as on March 31, 2014

Floating provisions at `18.4 Bn as on March 31, 2014

NPA rate lower than 10 year average even in current challenging environment

Indian GAAP figures. Fiscal year ended 31 st March.

Net Non Performing Assets (NPA) = Gross NPA less specific loan loss provisions

` - Rupees
12

Consistent Financial Performance

Net Profit

`. Mn

85,000

42,500

2004

2005

2006

2007

2008

ROA
2%

2010

2011

1.9%

2.0%

2012

2013

2014

EPS

`.
1.8%

1.5%

2009

35.5

36
28.5

1.6%
22.1

1%

18

0%

2010

2011

2012

2013

2014

17.0

13.5

2010

2011

2012

2013

2014

Indian GAAP figures. Fiscal year ended 31st March

13
1

Contents

Well positioned across GDP spectrum

Meeting Diverse Customers Needs
Unique Franchise in the Indian Banking Sector
Key Business Initiatives

Financial Highlights
Value Proposition

14

Retail Loans Profitable Growth

`. Bn

1,700
Two wheelers

Gold Loans
Others

Well diversified product mix

Balancing volumes and market

Kisan Gold Card

Credit Card

share with margins and risk

Commercial
Vehicles
Overseas
Retail

Home Loans* origination ` 118.9

Bn and buyback ` 55.6 Bn for FY

Home Loans

850

2014
Personal Loans

Loan losses for most products

stable and within product pricing

Business
Banking

parameters

Auto
Loans

0
2012

2013

2014

Retail loans are net of loans sold and include loan assignments. Retail loans are classified as per RBI guidelines for segmental reporting (Basel II).
* In arrangement with HDFC Ltd., Others includes Tractor Loans, Loans to Self Help Group, Retail overdrafts, Loans against Securities, etc
Indian GAAP figures. Fiscal year ended 31st March; ` - Rupees, Overseas Retail Secured by Deposits
15
1

Wholesale Banking - Accessing Multiple Segments

Wholesale Advances

`. Bn

Leveraging relationships with large & emerging

corporates for multiple revenue streams

Balanced mix between working capital financing,

term loans and transactional banking

Business Banking

Well diversified loan portfolio

Emerging Corporate

Investment banking capability across multiple

industry segments and product verticals

1,500
FIG
CV / CE
Others

750
Corporate

0
2012

2013

2014

Dealers
Vendors

Corporate

Distributors
OEM Customers

Leading provider of electronic banking services for supply chain management (SCM)

Structured cash management-cum-vendor/distributor finance

Indian GAAP figures. Fiscal year ended 31st March; Total wholesale advances are as per the RBI guidelines for segmental reporting (Basel II).
Others includes Capital markets ,commodity finance and other consumer loans over ` 50 million.
FIG Financial Institutions and Government group, CV/CE Large ticket commercial vehicle and construction equipment loans

` - Rupees
16
1

Focus on Transactional Banking Opportunities

`. Bn

Gross Cash Management Volumes *

Nos.

34,000

Primary Settlements Accounts

(Stock Exchanges)

1,700

17,000

850

0
2012

2013

2014

2012

2013

Clear market leader : cash settlements on stock & commodities exchanges

Leading provider of cash management solutions

Large corporates and SME

Financial Institutions

Government (including tax collections)

2014

For the Fiscal year ended 31st March,

* Gross Cash Management Volumes adjusted for collections on account of IPOs

` - Rupees
17
1

Customer Focused Treasury Products

`. Mn

Customer Revenues Mix

FX & Derivatives Revenues

15,000
BB
5%

FIG
4%

Others
7%
Corp
15%
ECG
10%

7,500

Retail
59%

0
2012

2013

2014

Revenues Largely customer driven, low reliance on trading revenue

Treasury advisory services

Plain vanilla FX offerings to retail and business banking segments

FX and derivatives product sales to corporate and institutional customers

Indian GAAP figures. Fiscal year ended 31st March; ` - Rupees

Corp Corporate, ECG Emerging Corporate Group, BB Business Banking, FIG Financial Institutions & Government Group;
Others includes Capital Markets and Commodity Finance
18
1

Cards Market Leadership

Credit Cards Receivables

Number of Cards

Acquiring Thruputs

`.Bn

`.Bn

24

130

1,000

12

65

500

Mn

0
2012

Debit cards

2013

2014

2012

2013

2014

2012

2013

2014

Credit cards

Market leader in credit cards

Over 70% of new credit cards issued to internal customers

Rationalisation of inactive cards

Merchant acquiring over 215,000 POS terminals, 30% growth in thru-puts in FY 2014

Indian GAAP figures. Fiscal year ended 31 st March. ` - Rupees

FY 2014 Fiscal year ended 31st March 2014
POS Point of Sale
19
1

Banking on Rural India

Banking Services for the rural eco-system
through customised loan and deposit
products whilst maintaining credit standards

Loan Products
Pre and Post Harvest Credit / Kisan Card
Tractor Loans
Small Working Capital Loan

Individuals

Local
Government

Sustainable Livelihood Banking

Liability Products
Regular / Basic Savings Bank Deposit Account
Term / Micro deposits

Food
Processors

Self Help
Groups

Micro Recurring Deposits

Other banking products
Life and General Insurance
Payment ecosystem

Intermediaries
(Arhatiyas, traders)

Farmers

Rural banking products offered through

traditional and micro branches in the deeper
geography of the country

Micro branches are primarily two member branches to expand and deepen the penetration in the rural market including in unbanked areas.

20

Subsidiary Companies
HDB Financial Services Limited

NBFC catering to certain customer segments not served by the Bank

Main Products: Retail (LAP, CV/CE, PL), Insurance services and Collection services

Network of 275 branches

FY 2014 - Loan book : ` 133.9 Bn, Net Profit : ` 2.1 Bn

FY 2014 - Gross NPA : 0.81%, Capital adequacy ratio (CAR) : 18.4%

HDFC Securities Limited

Amongst the leading equity brokerages in the country

Over190 branches and 1.9 million customers

Revenues from equity broking as well as distribution of financial products

FY 2014 - Net Profit : ` 784 million

` - Rupees
FY 2014 Fiscal year ended March 31, 2014; LAP Loan Against Property; CV/CE Commercial Vehicle and Construction Equipment Loans;
PL Personal Loans
21

Contents

Well positioned across GDP spectrum

Meeting Diverse Customers Needs
Unique Franchise in the Indian Banking Sector
Key Business Initiatives

Financial Highlights
Value Proposition

22

Key Financials
`. In million

Quarter
Ended
Sep14

Quarter
Ended
Sep13

Change

Year
Ended
Mar14

Year
Ended
Mar13

Change

Net Interest Income

55,110

44,765

23.1%

184,826

158,111

16.9%

Fees & Commissions

15,365

13,544

13.4%

57,349

51,669

11.0%

2,217

5,014

-55.8%

14,011

10,101

38.7%

951

(1,733)

1,105

1,613

-31.5%

1,938

1,619

19.7%

6,732

5,143

30.9%

Net Revenues

75,581

63,209

19.6%

264,023

226,637

16.5%

Operating Costs

34,979

29,342

19.2%

120,422

112,361

7.2%

4,559

3,859

18.1%

15,880

16,770

-5.3%

Profit Before Tax

36,043

30,008

20.1%

127,720

97,506

31.0%

Tax

12,228

10,184

20.1%

42,937

30,243

42.0%

Profit After Tax

23,815

19,824

20.1%

84,784

67,263

26.0%

FX & Derivatives
Profit / (loss) on Investments
Recoveries

Provisions & Contingencies

Indian GAAP figures (` Mn) , ` - Rupees.

23

Financial Highlights - Quarter ended September 2014

Net revenues up by 19.6% to ` 75.6 Bn

Net Interest Margin at 4.5%

Cost-to-income ratio at 46.3%

Net profit up by 20.1% to ` 23.8 Bn

Gross advances increased by 21.8% to ` 3,295 Bn

Deposits up by 24.8% to ` 3,907 Bn

Gross NPA / gross advances at 1.0%

Net NPA / net advances at 0.3%

Capital adequacy ratio (CAR)* - Total 15.7% of which Tier I at 11.8%

Indian GAAP figures (Bn =Billion); ` - Rupees; Net NPA = Gross NPA less specific loan loss provisions;
* Capital adequacy ratio computed as per RBIs Basel III regulations
Comparisons are with respect to corresponding figures for the quarter ended September 30, 2013
24

Contents

Well positioned across GDP spectrum

Meeting Diverse Customers Needs

Unique Franchise in the Indian Banking Sector

Key Business Initiatives
Financial Highlights
Value Proposition

25

Value Proposition Healthy Growth, Low Risk

Growing economy /
banking industry,
Gaining market share

Nationwide network, with

expanding semi urban and
rural footprint

Wide Product range and

multiple customer
segments

Healthy balance sheet and

revenue growth

Leading player across

multiple products

Branch Sales Process,

Data Mining & CRM,
geared for Cross sell

Disciplined margin and

capital management with a
focus on ROA/ROE

Strong Risk management,

focus on asset quality

Leveraging organic and

inorganic growth
opportunities

Proven ability to generate

Shareholder Value

26

Certain statements are included in this release which contain words or phrases, such as will, aim, believe, expect, will continue,
anticipate, estimate, intend, plan, future, objective, project, should, and similar expressions or variations of these
expressions, that are forward-looking statements. Actual results may differ materially from those suggested by the forward-looking
statements due to certain risks or uncertainties associated with our expectations with respect to, but not limited to, our ability to
implement our strategy successfully, the market acceptance of and demand for various banking services, future levels of our nonperforming loans, our growth and expansion, the adequacy of our allowance for credit and investment losses, technological changes,
volatility in investment income, our ability to market new products, cash flow projections, the outcome of any legal, tax or regulatory
proceedings in India and in other jurisdictions we are or become a party to, any penalties imposed by the RBI, the future impact of new
accounting standards, our ability to pay dividends, the impact of changes in banking regulations and other regulatory changes in India
and other jurisdictions on us, our ability to roll over our short-term funding sources and our exposure to market and operational risks. By
their nature, certain of the market risk disclosures are only estimates and could be materially different from what may actually occur in
the future. As a result, actual future gains, losses or impact on net income could materially differ from those that have been estimated.
Our forward looking statements speak only as of the date on which they are made and we do not undertake any obligation, and we do
not intend, to update or revise any forward looking statements to reflect events or circumstances after the date in the statement, even if
our expectations or any related events or circumstances change. In addition, other factors that could cause actual results to differ
materially from those estimated by the forward-looking statements contained in this document include, but are not limited to: general
economic and political conditions, instability or uncertainty in India and other countries which have an impact on our business activities
or investments caused by any factor including the global financial crisis and problems in the Eurozone countries, any downgrade in
Indias debt rating or the debt rating of our borrowings, terrorist attacks in India, the United States or elsewhere, anti-terrorist or other
attacks by the United States, a United States-led coalition or any other country, tensions between India and Pakistan related to the
Kashmir region, military armament or social unrest in any part of India, the monetary and interest rate policies of the government of
India, natural calamities, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other
rates or prices, the performance of the financial markets in India and globally, changes in Indian and foreign laws and regulations,
including tax, accounting and banking regulations, changes in competition and the pricing environment in India, and regional or general
changes in asset valuations.