NHB approves HDFC and HDFC Bank merger

10 Aug 2022 , 08:21 AM

According to a regulatory statement on Tuesday, mortgage industry giant HDFC has gained approval from the National Housing Bank (NHB) for the merger with its subsidiary HDFC Bank.

The filing stated that the NHB had also authorized the merger of the housing financing company’s two wholly-owned subsidiaries, HDFC Investments and HDFC Holdings Limited, with HDFC.

As required by the refinance facilities that HDFC Ltd. had accessed from NHB, “We desire to tell you that the NHB via its letter dated August 8, 2022, has approved its no-objection to the plan,” HDFC said in the filing.

The Reserve Bank, Sebi, and the stock exchanges (NSE and BSE) have already given their approval to the proposed merger between HDFC and HDFC Bank, which would make it the largest mortgage lender in the nation by asset size.

The merger plan is still awaiting permission from a number of legal and regulatory bodies, including the NCLT, the Competition Commission of India, and the respective shareholders and creditors of the two companies.

The total asset base of the merging company will be close to Rs18 lakh crore. Before the second or third quarter of FY24, the merger is anticipated to be finished.

Once the agreement is in place, existing HDFC shareholders will own 41% of the bank, making public shareholders the sole owners of HDFC Bank.