cbop and hdfc merger
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Mergerof
Indian banking industrywith
foreign banking industry
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Presented by:
Slides
34 Surendra Madiwala 9-10
35 Kishan Parmar 7-8
36 Bhavesh Ahir 11-12
37 Sneha Patel 3-6
38 Marcel Chettiar 13-15
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Introduction
According to Oxford Dictionary the expression
merger means combing two commercial
companies into one
Bank merger is an event of when previously
distinct banks are consolidated into one
institution
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Merger between Centurion Bank
and Bank of Punjab and HDFC
The centurion bank of punjab (formerly centurion
bank) was an Indian private sector bank that
provided retail and corporate banking services
The Bank's shares were listed on the major Indian stock
exchanges and on the Luxembourg Stock Exchange.
On 23 May 2008 HDFC acquired Centurion Bank of
Punjab.
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History of Centurion Bank
Centurion Bank was incorporated on 30 June 1994
It was a joint venture between 20th Century Finance
Corporation and its associates and Keppel Group ofSingapore through Kephinance Investment (Mauritius)
On 29 June 2005, Centurion Bank and Bank of Punjab a
merger of the two banks. The combined bank took as itsname Centurion Bank of Punjab.
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History of Centurion Bank
2006 Centurion Bank of Punjab acquired Kochi-
based Lord Krishna Bank
(Lord Krishna acquired three commercial banks:Thiyya Bank, Josna Bank and Kerala Union
Bank.)
2008 HDFC Bank acquired Centurion Bank of
Punjab
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About HDFC Bank
Promoted in 1995 by (HDFC), India's leading
housing finance company, HDFC Bank is one of
India's premier banks providing a wide range of
financial products and services
Over the last 13 years, the bank has
successfully gained market share in its target
customer franchises while maintaining healthy
profitability and asset quality
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Acquisition of Centurian bank
of Punjab by HDFC It is indeed one of the largest banking sector
consolidation ever in India
The acquisition makes HDFC Bank the seventhlargest bank in terms of assets
The total assets would rise to Rs.1,10,110 crore,with branch network of 1150, ATM network of
2100 and 27000 staff.
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Main Highlights of Merger
The merger was effected using the pooling of
interest method. The banks main task was to
harmonize the accounting policies
The harmonizing was done to bring in more
stringent provisioning requirements for
identifying NPAs as the existing norms of the
erstwhile CBoP were comparatively more
relaxed.
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Main Highlights of Merger
CBoP had a much lower CASA ratio of around
25% compare to 56% of Pre-merged HDFC
Bank. By the end of the year, the target CASA
ratio is around 47-48%.
The cost/income ratio of the merged entity has
increased to around 56% from 50% levels for
standalone HDFC Bank. The increase was
expected as CBoPs C/I ratio was around 60%.
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KEY BUSINESS
PARAMETERS (Rs Million)
BANKING MERGER.xlsx
http://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsxhttp://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsxhttp://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsxhttp://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsx -
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MERGER
Branch expansion/Size likely
determinant of the merger
HDFC Bank would emerge as the biggest
private bank in terms of branches
Positive aspects of the merger
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HDFC Bank to be largest private sector
bank in terms of branch network
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POST MERGER SNAPSHOT
BANKING MERGER.xlsx
http://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsxhttp://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsxhttp://localhost/var/www/apps/conversion/tmp/scratch_3/BANKING%20MERGER.xlsx -
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Conclusion
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THANKYOU
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