Mergers challenge world's biggest banks

HDFC is a familiar name to Indians, but the name is not well known in the international market.

However, that is set to change, as the bank is set to enter the list of the world's most valuable banks after completing its merger with its parent company - Housing Development Finance Corporation (HDFC), a Mumbai-based private mortgage lender founded in 1977.

The $40 billion merger between India’s largest private bank and India’s largest housing finance company was announced in April 2022. It is considered the largest transaction in India’s history, creating a financial services giant with a market capitalization of more than $172 billion. This figure puts HDFC in fourth place, behind only JPMorgan, Industrial and Commercial Bank of China (ICBC) and Bank of America.

HDFC will leapfrog giants HSBC and Citigroup, and outstrip Indian peers State Bank of India and ICICI Bank, which had market capitalizations of around $62 billion and $79 billion, respectively, as of June 22.

With the merger taking effect on July 1, the new HDFC Bank entity will have around 120 million customers (larger than the population of Germany), over 8,300 branches and over 177,000 employees.

HDFC Bank will be 100% owned by public shareholders, and existing HDFC shareholders will own 41% of the bank. Each HDFC shareholder will receive 42 shares of HDFC Bank for every 25 shares they hold.

HDFC is expected to grow at 18-20%, and plans to double its branch count in the next four years, according to Suresh Ganapathy, head of India financial services research at Australian financial services group Macquarie .

Nguyen Tuyet (According to Quartz, Bloomberg, NDTV)

Source: https://www.nguoiduatin.vn/vu-sap-nhat-thach-thuc-cac-ngan-hang-lon-nhat-the-gioi-a615267.html