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Lending rates, especially in the retail segment such as auto loans, are likely to increase in the next few days. This may have some impact on big-ticket auto sales as monthly repayments would rise, said Mr Paresh Sukthankar, Executive Director, HDFC Bank.
As on December 31, 2010, HDFC Bank's auto loan portfolio grew by 36 per cent to Rs 24,600 crore. This segment accounts for the largest share in the total retail loan portfolio of Rs 89,000 crore.
The private sector bank is continuing to see healthy demand for retail loans such as for two-wheelers, cars, commercial vehicles and also for working capital loans on the corporate side, said Mr Sukthankar, while announcing the bank's third-quarter results.
“Deposit rates have gone up in the last few weeks. But on the retail side lending rates have not moved up to the extent that deposit rates have moved. So, there is an upward bias to lending rates,'' he said.
While there is an upward bias in deposit rates as well, they would rise with a lag and a further increase from the current levels would only be marginal, he added.
Net profit up 33%
For the December quarter, HDFC Bank reported 33 per cent higher net profit at Rs 1,088 crore, against Rs 818 crore in the corresponding quarter last year, aided by strong asset growth and robust fee income.
Year-on-year, wholesale loans grew by 29 per cent and retail loans by 34 per cent.
With a credit-deposit ratio of 82 per cent, the bank would need to step up deposit growth going ahead, Mr Sukthankar said.
“Going ahead we would need a greater alignment of credit and deposit growth. But we are comfortable from the liquidity perspective. We could utilise our capital funds and surplus liquidity to fund credit growth. We have not resorted to borrowing in the call market,'' he said.
The Tier-I capital of HDFC Bank is at 12 per cent.
Branch expansion
The bank will add about 100-150 branches in the last quarter, which will help in further increasing the share of low-cost current and savings accounts, Mr Sukthankar said.
Shares of HDFC Bank closed at Rs 2,052.15, down 1.67 per cent from the previous close of Rs 2,087, on the BSE, on Thursday.
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