Annual Report 2012 - 2013 Encouraging sustainability Empowering lives Accolades 2012-2013 Asia Money Best Bank Awards Financial Express Best Bank Awards ••Best Domestic Bank in India Best Bank – Private Sector • Best in Strength and Soundness Businessworld Awards for Banking Excellence • Best Banker – Aditya Puri • Most tech-friendly Bank • Deal of the year (Rupee bonds) IBA Banking Technology Awards • Best Online Bank CNBC TV18 India Best Banks and Financial Institutions • Best use of Business Intelligence Awards • Best Customer Relationship Initiative • Best Private Sector Bank • Best Risk Management & Security Initiative • Best use of Mobile Technology in Banking CSO Forum Information Technology Award • Best Information Security Practice IDRBT Banking Technology Excellence Awards • Best Bank in IT for Operational Effectiveness DSCI Information Technology Awards • Security Leader of the year Mint-Aon Hewitt’s India’s Best Managed Boards • Security in Bank • HDFC Bank among India’s six best managed Boards Dun & Bradstreet Banking Awards Nasscom CNBC-TV18 Innovation Award • Overall Best Bank • Best IT driven innovation in Banking (Commercial) • Best Private Sector Bank • Best Asset Quality – Private Sector National Quality Excellence Awards ••Best Retail Banking – Private Sector Best Customer Service Result Dun & Bradstreet Corporate Awards – India’s Top 500 NDTV Profit Business Leadership Awards Companies • Best Bank in India • Best Bank in India Skoch Foundation Financial Inclusion Awards Economic Times Awards for Corporate Excellence • Organisation of the Year • Company of the Year 2012 Financial Highlights 2003-2004 2004-2005 2005-2006 Interest Income * 2,572.04 3,119.78 4,547.26 Interest Expense 1,211.05 1,315.56 1,929.50 Net Interest Income 1,360.99 1,804.22 2,617.76 Other Income * 519.28 719.36 1,237.08 Net Revenues 1,880.27 2,523.58 3,854.84 Operating Costs * 964.82 1,369.25 2,116.82 Operating Result 915.45 1,154.33 1,738.02 Provisions and Contingencies 196.49 175.39 484.51 Loan Loss Provisions * 179.04 174.74 484.21 Others 17.45 0.65 0.30 Profit Before Tax 718.96 978.94 1,253.51 Provision for Taxation 209.46 313.38 382.73 Profit After Tax 509.50 665.56 870.78 Funds : Deposits 30,408.86 36,354.25 55,796.82 Subordinated Debt 600.00 500.00 1,702.00 Stockholders’ Equity 2,691.88 4,519.85 5,299.53 Working Funds 42,306.99 51,429.00 73,506.39 Loans 17,744.51 25,566.30 35,061.26 Investments 19,256.79 19,349.81 28,393.96 Key Ratios : Earnings per Share (`) ** 3.59 4.58 5.58 Return on Average Networth 20.14% 20.44% 17.47% Tier 1 Capital Ratio 8.03% 9.60% 8.55% Total Capital Ratio 11.66% 12.16% 11.41% Dividend per Share (`) ** 0.70 0.90 1.10 Dividend Payout Ratio 22.15% 24.00% 22.55% Book value per Share as at March 31 (`) ** 18.90 29.17 33.85 Market price per Share as at March 31 (`) *** 75.75 114.73 154.85 Price to Earnings Ratio 21.10 25.03 27.74 ` 1 Crore = ` 10 Million * Figures for the previous years have been adjusted to reflect the effect of reclassification as mentioned in point number 2 of Sch 18-Notes to accounts ** Figures for the years prior to 2011-2012 have been adjusted to reflect the effect of split of equity shares from nominal value of ` 10 each into five equity shares of nominal value of ` 2 each. HDFC Bank Limited Annual Report 2012-13 10 (` crore) 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013 7,055.35 10,530.43 16,584.01 16,467.92 20,380.77 27,874.19 35,064.87 3,179.45 4,887.12 8,911.10 7,786.30 9,385.08 14,989.58 19,253.75 3,875.90 5,643.31 7,672.91 8,681.62 10,995.69 12,884.61 15,811.12 1,679.21 2,495.94 3,700.65 4,573.63 4,945.23 5,783.62 6,852.62 5,555.11 8,139.25 11,373.56 13,255.25 15,940.92 18,668.23 22,663.74 2,975.08 4,311.03 5,950.54 6,475.71 7,780.02 9,277.64 11,236.11 2,580.03 3,828.22 5,423.02 6,779.54 8,160.90 9,390.59 11,427.63 941.28 1,547.59 2,123.78 2,490.40 2,342.24 1,877.44 1,677.01 877.13 1,278.84 1,970.35 2,288.74 1,198.55 1,091.77 1,234.21 64.15 268.75 153.43 201.66 1,143.69 785.67 442.80 1,638.75 2,280.63 3,299.24 4,289.14 5,818.66 7,513.15 9,750.62 497.30 690.45 1,054.31 1,340.44 1,892.26 2,346.08 3,024.34 1,141.45 1,590.18 2,244.93 2,948.70 3,926.40 5,167.07 6,726.28 68,297.94 100,768.60 142,811.58 167,404.44 208,586.41 246,706.45 296,246.98 3,282.60 3,249.10 8,738.58 6,353.10 7,393.05 11,105.65 16,586.75 6,433.15 11,497.23 14,646.33 21,519.58 25,376.35 29,924.37 36,214.15 91,235.61 133,176.60 183,270.77 222,458.57 277,352.59 337,909.50 400,331.90 46,944.78 63,426.90 98,883.05 125,830.59 159,982.67 195,420.03 239,720.64 30,564.80 49,393.54 58,817.55 58,607.62 70,929.37 97,482.91 111,613.60 7.26 9.24 10.57 13.51 17.00 22.11 28.49 19.40% 16.05% 16.12% 16.80% 16.52% 18.37% 20.07% 8.58% 10.30% 10.58% 13.26% 12.23% 11.60% 11.08% 13.08% 13.60% 15.69% 17.44% 16.22% 16.52% 16.80% 1.40 1.70 2.00 2.40 3.30 4.30 5.50 **** 22.92% 22.17% 22.17% 21.72% 22.72% 22.70% 22.77% 40.28 64.88 68.86 94.02 109.09 127.52 152.20 190.83 266.25 194.68 386.70 469.17 519.85 625.35 26.29 28.80 18.42 28.62 27.59 23.51 21.95 ***Source : NSE (prices for years prior to 2011-2012 have been divided by five to reflect the sub-division of shares) **** Proposed HDFC Bank Limited Annual Report 2012-13 11 BOARD OF DIRECTORS EXECUTIVE VICE PRESIDENT Mr. C. M. Vasudev, Chairman (LEGAL) & COMPANY SECRETARY Mrs. Renu Karnad Mr. Sanjay Dongre Mr. Ashim Samanta (upto 18.11.2012) Dr. Pandit Palande Mr. Partho Datta Mr. Bobby Parikh STATUTORY AUDITORS Mr. A. N. Roy BSR & Co., Chartered Accountants Mr. Keki Mistry Mr. Vijay Merchant (appointed on 14.03.2013) Mr. Aditya Puri, Managing Director Mr. Harish Engineer, Executive Director Mr. Paresh Sukthankar, Executive Director REGISTERED OFFICE HDFC Bank House, Senapati Bapat Marg, Lower Parel, Mumbai 400 013. SENIOR MANAGEMENT TEAM Tel: + 91 22 66521000 Mr. A Parthasarthy Fax: + 91 22 24960737 Website: www.hdfcbank.com Mr. Abhay Aima Mr. Anil Jaggia Mr. Anil Nath Mr. Bhavesh Zaveri Mr. Jimmy Tata REGISTRARS & TRANSFER AGENTS Mr. Kaizad Bharucha Datamatics Financial Services Ltd Mr. Navin Puri Plot No. B 5, Part B Crosslane, Mr. Rahul Bhagat MIDC, Marol, Andheri (East), Mr. Rajender Sehgal Mumbai 400 093. Tel: + 91 22 66712213-14 Mr. Sashi Jagdishan Fax: + 91 22 28213404 Mr. V Chakrapani E-mail: [email protected] HDFC Bank Limited Annual Report 2012-13 12 19th ANNUAL GENERAL MEETING Date : June 27, 2013 Day : Thursday Time : 2.30 p.m. Place : Birla Matushri Sabhagar, 19, New Marine Lines, Mumbai 400 020 Book Closure for AGM : 15th June, 2013 to 27th June, 2013 (both days inclusive) Contents Directors’ Report 14 - 27 Independent Auditor's Report 28 - 29 Financial Statements 30 - 86 Basel II - Pillar 3 Disclosures 89 - 111 Independent Auditor's Report for Consolidated Financial Statements 112 - 113 Consolidated Financial Statements 114 - 156 Information with regard to Subsidiary Companies 157 Independent Auditor's Certificate on Corporate Governance 158 Corporate Governance 159 - 173 Shareholder Information 174 HDFC Bank Limited Annual Report 2012-13 13 Directors' Report To the Members, Your Directors take great pleasure in presenting the Nineteenth Annual Report on the business and operations of your Bank together with the audited accounts for the year ended March 31, 2013. FINANCIAL PERFORMANCE (` in crore) For the year ended March 31, 2013 March 31, 2012 Deposits and Other Borrowings 329,253.6 270,553.0 Advances 239,720.6 195,420.0 Total Income 41,917.5 33,657.8 Profit before Depreciation and Tax 10,402.3 8,055.7 Net Profit 6,726.3 5,167.1 Profit brought forward 8,399.6 6,174.2 Total Profit available for Appropriation 15,125.9 11,341.3 Appropriations : Transfer to Statutory Reserve 1,681.6 1,291.8 Transfer to General Reserve 672.6 516.7 Transfer to Capital Reserve 85.8 - Transfer to / (from) Investment Reserve 17.7 (41.7) Proposed Dividend 1,309.1 1,009.1 Tax Including Surcharge and Education cess on Dividend 222.5 163.7 Dividend (including tax / cess thereon) pertaining to previous year paid during the year 4.5 2.1 Balance carried over to Balance Sheet 11,132.2 8,399.6 The Bank posted total income and net profit of ` 41,917.5 crore and ` 6,726.3 crore respectively for the financial year ended March 31, 2013 as against ` 33,657.8 crore and ` 5,167.1 crore respectively in the previous year.