In an exclusive face to face with the-south-asian, Aditya Puri, MD/CEO of the HDFC Bank, explains, in first person, how it all happened.

AP: "Over the last 5 years we have tried to establish a technical platform inclined towards growth – we have centralised processing, we have ‘Open’ systems that are scalable and all our branches are connected on-time and real-time. Our systems are in place, our technology is in place, our ability to expand is in place, our people are in place and our products are in place.

Five and a half years ago we had nothing. Today we have the basis for a very rapid growth – 95% of the banking business today is with nationalised banks who provide a very different level of service."

t-s-a: What led to the phenomenal growth? – products or services?

AP: There was a vacuum in the market – there were the nationalised banks on one side - providing to a larger part of the country both in terms of geography and people – and there were the foreign banks on the other side – small but catering to a premium segment. The entire centre – value for money services, international services was vacant and is still vacant – this was a large centre – so we wanted to come up with something that had the geographical reach of the Indian banks, had the comfort for the middle class people to walk in to an Indian bank and the products and services of the foreign banks. That left us with a very, very wide platform – there were 9 or 10 banks that were licensed at the same time – and fortunately for us the other banks hired people from the State Bank and other nationalised banks – so their thinking continued to be what it had been for 40 years – philosophy largely remained the same. We wanted to have a world class Indian bank and based on that we hired people who were the best in the field, who understood technology and where banking was going – I came from Citibank, my Head of Technology from Bank of America, Risk Manager from Citibank, head of Private Banking from UBS, Marketing Head from Levers and Bank of America, Control Head from the Reserve Bank of India, treasury team from Hong Kong Bank, local banks and Arthur Anderson – we got the best and preferably people who had international work exposure and understood what an international bank was and where technology was taking us.

We did not want to set up an Indian bank nor did we want to set up a subcontinental bank – we wanted to be state-of-the-art and be able to offer products that were better than Chase and Citi or Hong Kong Bank. We made a substantial change –previously you had to have a mainframe, proprietary products and that was one hell of an investment – now with the change that has taken place in computing and software that is available and the software expertise that is available –you can get much better products and you have options and choices. We no longer use a mainframe – we have small boxes – so we didn’t have to have this major capital requirement up front.

We really don’t define ourselves as a bank – we are a financial services provider – we want to meet the needs of the capital, retail and corporate markets. The paradigm has changed. A customer has the facility to deal with us anytime, anywhere, anyhow – we have 24 hour banking –on the ATM, telephone, PC, and mobile phone. The next question was- what else does the customer want? He wants depository products, loans, mutual funds, he wants to buy insurance, he wants housing, he wants to make bill payments, tax payments, he wants advice on mutual funds, FX, money markets – so we should be able to give him all of this. And we redefined what we call a networked organisation, in the sense, that we offer not only our products but others’ too - we’ll sell a Merrill Lynch Fund, we will sell a Jardine mutual fund.

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