Certainl
y, despite being amongst the first to receive an ‘in principle’ approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, HDFC has not been successful enough in leveraging its brand equity to get market share. It has been continually losing its ground to ICICI and other banks on all possible fronts. The irony can be best illustrated by considering the fact that HDFC Bank’s fixed deposit programme has been rated ‘CARE AAA (FD) implying ‘best quality carrying negligible investment risk’; yet, the bank’s deposits stand at Rs.557.97 billion as compared to ICICI Bank’s deposits of Rs.1,650.83 billion, which are an unbelievable 300% more than HDFC Bank’s. Paradoxically again, be it CARE (as above), Fitch or CRISIL; all the rating agencies have rated HDFC Bank’s products high on their rating parameters, yet consumers’ response to the same has been mild and static, with an evident declining market share. It is argued that figures don’t lie, so we will let the figures do all the talking for us: HDFC Bank has 1,605 Automated Teller Machines (ATMs) across India, unquestionably a humungous figure if considered in isolation, but when compared to the number of ATMs that ICICI or SBI has, it bears a shoddy appearance.
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
y, despite being amongst the first to receive an ‘in principle’ approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, HDFC has not been successful enough in leveraging its brand equity to get market share. It has been continually losing its ground to ICICI and other banks on all possible fronts. The irony can be best illustrated by considering the fact that HDFC Bank’s fixed deposit programme has been rated ‘CARE AAA (FD) implying ‘best quality carrying negligible investment risk’; yet, the bank’s deposits stand at Rs.557.97 billion as compared to ICICI Bank’s deposits of Rs.1,650.83 billion, which are an unbelievable 300% more than HDFC Bank’s. Paradoxically again, be it CARE (as above), Fitch or CRISIL; all the rating agencies have rated HDFC Bank’s products high on their rating parameters, yet consumers’ response to the same has been mild and static, with an evident declining market share. It is argued that figures don’t lie, so we will let the figures do all the talking for us: HDFC Bank has 1,605 Automated Teller Machines (ATMs) across India, unquestionably a humungous figure if considered in isolation, but when compared to the number of ATMs that ICICI or SBI has, it bears a shoddy appearance.For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative
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