One morning in February 2016, when Aditya (Puri) got up from his bed, he felt an acute backache. His wife Smiley found him sweating profusely and turning pale and insisted on seeing a doctor immediately. Usually, the driver does not turn up before 8.30 a.m. when Aditya leaves for office. She went out, hailed a cab and rushed to Hinduja Hospital at Mahim. Aditya didn't have a blockage in his heart but a clot at the cross section of the main artery.
Dr Sudhanshu Bhattacharya and his second-in-command, Dr Laxman Khyade, operated on Aditya at Breach Candy Hospital - a bypass surgery. After the stitches were removed, Aditya saw the doctors' bill. He was surprised - not at the amount but how his bank had missed out this segment of customers. Aditya realised that the bank never focussed on doctors and asked the bank staff to work out a plan to woo them.
Two years down the line, when they were holding a meeting in the boardroom, suddenly Aditya asked all the eight people present there to follow him. He walked down on the streets of Parel (in the vicinity of HDFC Bank's headquarters) and asked them to choose any shop where he would go and try to sell his products. When none of them could figure out where to go, he himself walked down to a lane off Senapati Bapat Marg.
Aditya went into the first shop - a garment shop. He asked the shop keeper whether he wanted anything. The shopkeeper said that he had everything by God's grace and didn't want anything else. "Bhaiya main MD hoon HDFC Bank ka. MD aya hai kuch toh de sakenge na." Aditya explained to him all the offers of HDFC Bank and the shopkeeper immediately shifted his account to the bank.
There is a background to this. Aditya had a vision of getting organised merchants on the banking platform. Although approximately two million such customers were already into the fold of banks, the market was too large. He asked his employees to go out in the market and see it themselves. One day, he stood up in anger and said, "I have had enough of you. Only one of us can be right." He left the meeting room, took the lift and walked down the road; others followed.
Common Sense Banker
Common sense and curiosity are far more important than anything else in banking. Technology, products and profile of competition have been changing and, to understand the change, one has to be like a school kid or a teenager while heading an institution. Aditya has done that remarkably well, and very differently. Nobody knows this difference better than Arun Maira, member of the now defunct Planning Commission.
Arun was an Executive Director of TELCO (now Tata Motors), and Aditya was with Citibank, looking after corporate banking. Arun's responsibility was getting TELCO into new markets. At that time, he was working on a proposed joint venture with General Motors to develop a pickup truck suitable for southern regions of the USA and the Middle East. General Motors was pushing for a very stiff price formula as it believed that the rupee would depreciate and, therefore, TELCO would gain a lot even though they would not have to pay much in dollars. Arun asked for Aditya's view on the rupee. Aditya's projection was quite different. "He was just talking from common sense. He wasn't a fancy financier," Arun told me.
Arun also knows Deepak (Parekh) well. One of HDFC's first big projects was with TELCO in Pune. The Tata Group company didn't have enough money to build a big colony like it had done in Jamshedpur, though it had land. Hasmukh-bhai came up with a proposal that HDFC could lend money to the TELCO workers to build houses.
HDFC lent to TELCO employees and the company took the responsibility of repaying by deducting money from their salaries every month. Deepak had just come back from the USA and Arun was a young general manager, in charge of the Pune factories. Deepak asked Arun to join his board but expressed helplessness in not being able to offer much money as RBI rules did not allow the bank to pay commission to its directors. Aditya advised him not to jump at the offer unless he was convinced that money was not important. Arun listened to him.
"Deepak is someone very sound and conservative in his approach who wants to do the right thing. Aditya has the same approach but he is different from others," observes Arun. For instance, Deepak's business habits are similar to common business habits such as playing bridge with friends, but Aditya spends time only with his family. Deepak spends long hours in office, Aditya does not.
The Tough Man
During the initial days, the bank had exposure to a company of a large group. HDFC Bank was part of a consortium which had given loan to this entity. The loan was declared as an NPA and the promoter was trying to route their cash flows through a group company. Luckily, the group company's account was with HDFC Bank too. The bank immediately froze the account and seized the money which the company did not like and moved court against the bank. The court case is still on.
In February 2015, the bank had an exposure to a large steel company. By that time, the RBI had come up with the concept of Joint Lenders' Forum (JLF) to speed up the decisions in relation to stressed assets. The decision by the JLF, taken by the majority, was to be followed by all the members of the forum. In this case, although the JLF thought that the projections given by the steel company were feasible to lend fresh money, Aditya was not convinced. When he told the promoter that he would not give a new loan, the promoter threatened Aditya that he would pay other lenders but not HDFC Bank. Aditya just said, "No problem; go ahead and do that. I know how to extract the money." Within the next eight hours, Aditya sold the bank's exposure to an asset reconstruction company, before even the JLF could take a decision.
The promoter of a now defunct airline and Aditya were good friends. While the airline was at the height of glory, he approached the bank for credit lines. Although denied, the gentleman, known for his flamboyance, wanted to meet Aditya to leverage on his relations with him. Aditya told him that they were good friends but the bank didn't want to go ahead with the project as they were professionally not comfortable with it. The airline boss got upset and said, "Aditya, I thought you were a good banker but I am convinced that you need to learn some more banking". A calm Aditya retorted that time would tell who knew banking and who did not.
Aditya has the guts to say no to many such high profile promoters. A fugitive diamond merchant had approached him twice for a credit line in 2017, a year before he left India after PNB complained to the CBI of being defrauded by his company around $2 billion. The gentleman approached for the second time. A sweet talker, the diamond merchant said that two reputed organisations like his and that of Aditya's should come together and do business. Aditya was very clear that if there were opportunities and synergies then they surely would, but at that moment the bank did not understand the diamond business and was not willing to get into it.