BUSINESS DESK: ICICI’s Bid for HDFC: A Historical Proposal Unveiled
Deepak Parekh’s Revelation
Former HDFC chairman Deepak Parekh disclosed that ICICI Bank, under Chanda Kochhar’s leadership (2009–2018), proposed acquiring HDFC’s mortgage business before its 2023 merger with HDFC Bank. This revelation emerged during an interview on Kochhar’s YouTube channel.
Historical Context of the Proposal
Parekh noted ICICI’s historical ties to HDFC, as the latter was originally founded by ICICI. The acquisition proposal sought to reconsolidate HDFC’s mortgage operations under ICICI’s umbrella, leveraging their shared legacy.
Reasons for Rejection
The proposal was declined due to strategic misalignment. Parekh cited HDFC’s distinct brand identity, operational independence, and banking priorities as key factors that rendered the merger unsuitable at the time.
HDFC-HDFC Bank Merger Insights
Parekh described the 2023 HDFC-HDFC Bank merger as a “painful yet joyful” milestone, supported by the Reserve Bank of India (RBI) without special concessions. He emphasized its strategic benefits for long-term growth.
Vision for Banking Consolidation
Advocating for larger, globally competitive Indian banks, Parekh underscored the need for sector consolidation through acquisitions. He drew comparisons to China’s robust banking institutions, urging Indian banks to scale up.
Critique of Insurance Practices
Parekh expressed concerns over the insurance sector, criticizing banks for mis-selling insurance products to earn commissions. He highlighted the need for better consumer education and regulatory oversight.