cbop and hdfc merger

8/22/2019 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

cbop and hdfc merger

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