Deepak Parekh Remarkable journey: From a Banker to Entrepreneur

Deepak Parekh, widely regarded as India’s most esteemed banker, has made the announcement of his retirement as the Chairman of HDFC Bank. This decision follows the merger between the bank and the company’s lending division. With a career spanning over four decades, Deepak Parekh has played a pivotal role in shaping India’s banking sector and has remained a prominent figure within the industry.

Following the merger, HDFC has achieved the remarkable feat of becoming the fourth largest bank in the world based on market value. The combined market capitalisation of the merged entity now stands at approximately Rs 15 lakh crore. This achievement highlights the significant growth and consolidation of HDFC, solidifying its position as a major player in the banking industry.

HDFC Bank holds the distinction of being the largest private bank in India. Its foundation can be traced back to the 1970s when it was established by HT Parekh, who was Deepak Parekh’s uncle.

HDFC, originally established by Deepak Parekh’s uncle HT Parekh in 1977, initially operated as a small lending firm. HT Parekh held a deep affection for Deepak Parekh and regarded him as a son. Recognizing Deepak’s talent, HT Parekh extended an invitation for him to join HDFC.

He became an employee of HDFC in 1978 and gradually opted for the role of an entrepreneur within the organisation. This decision marked the beginning of Deepak Parekh’s illustrious career with the company. Despite earning 50% less than his previous lucrative banking job, he possessed a visionary outlook, driven by the goal of enabling individuals to fulfill their dream of owning a home at an early stage of life.

Over the years, under his leadership, HDFC Bank grew into a banking powerhouse. Deepak Parekh’s visionary guidance and hands-on approach played a pivotal role in the bank’s success and emergence as a leading financial institution in India. He was renowned for his modest and low-profile behaviour. 

Despite his prominent position, his shareholding in HDFC Bank amounts to only Rs 155 crore as of 2022, reflecting a mere 0.04% stake. He once stated in an interview that he considers himself an entrepreneur who operates with the mindset of a salaried employee. This mindset resonates with his uncle, who also worked for a salary and resided in a rented house.

Parekh’s salary was 50% lesser than what he was earning in London. He pushed for the company’s banking license even though the board didn’t agree with the decision at that time. He also gave a free hand to Aditya Puri to run the bank. Due to efforts made by them, the bank has a customer base of approximately 7 crore and has 7821 branches across 3811 cities or towns.

He not only spearheaded the bank successfully and with full honesty but also helped others put their houses in order. His legacy isn’t limited to business growth and development. He is lauded for his unrelenting calls for standardisation and transparency in the real estate sector. He also served as a Special Director on the Satyam Board in 2009, enabling its resurgence. He played a pivotal role in the restructuring of UTI in the late 1990s, rebuilding investor trust.

In his last message to the shareholders, Parekh emphasised the immeasurable value of the HDFC experience, stating that our history is indelible and cannot be erased. 

“It is my time to hang my boots with both anticipation and hope for the future. While this will be my last communication to shareholders of HDFC, rest assured we now stride tall into a very exciting future of growth and prosperity. The HDFC experience is invaluable. Our history cannot be erased and our legacy will be taken forward,” he was quoted as telling shareholders.