HDFC Bank must surely be the envy of every banker in town, but the task of the man who runs it isn’t an enviable one. Nonetheless, Sashi Jagdishan who took over as MD&CEO of the country’s largest private sector lender in late 2020, has taken the job in his stride. If he inherited a large, robust organisation, with the cleanest book in the business, he will soon be running an even bigger one, now that HDFC is going to be merged with HDFC Bank.

HDFC Bank couldn’t have got luckier. It has just won a top-class mortgage portfolio at what analysts believe is a relatively inexpensive valuation. With combined assets of close to 18 trillion — twice the size of ICICI Bank’s book — the lender will be a formidable entity. But more than this, what will please the unassuming and reclusive Jagdishan is that the bank can now build a long-duration mortgage portfolio, the absence of which was slowing loan growth. Indeed, a disproportionate share of short-duration retail loans which are harder to re-fill because repayment rates are high, has been a problem. To try and compensate this for this HDFC Bank turned to non-salaried customers. But while the yields in this segment may be tempting, the loan losses can hurt. While the bank built up the corporate portfolio, in a bid to keep the growth momentum going, the demand from companies has been rather muted post the pandemic. Nonetheless, the strategy was working reasonable well allowing the bank to gain market share. But now, given that the balance sheet is considerably larger and that the market too has become a lot more competitive the lack of a mortgage portfolio may have seriously stymied growth. Home loans are a huge opportunity in a large under-penetrated market like India’s; mortgages as a share of GDP are at 11% while for China it is 20%. The outstanding portfolio is estimated to be in the region of25 trillion and in most years, the market grows in double digits. Around, 70% of HDFC Bank’s customers don’t have a home loan from HDFC so there’s an opportunity lurking right in his front yard.

A big mortgage portfolio should help HDFC Bank diversify the risk in the portfolio and for Jagdishan, therefore, the merger couldn’t have come a day too soon. At the press conference on Monday, held to announce the merger, Jagdishan hinted the lender doesn’t intend to waste any time. In addition, the deal will bring HDFC Bank a customer base — belonging to HDFC — to which it could cross-sell a range of products.

To take the bank to the next level, the down to earth Jagdishan, who loves thayirshadam and who makes it for his kids faithfully following a recipe from his grandfather, must make sure the technology platform is top class. In late 2020, the regulator had stopped the lender from rolling out digital products and services and issuing new credit card owing to technological glitches. This has since been sorted out but Jagdishan cannot afford such episodes.

Where he’s ahead of the curve is in readying a challenger digital bank that will target spends and borrowings of younger customers over a lifetime.That’s smart thinking at a time when banking is going increasingly digital.

At heart, Jagdishan is a scientist who traded his love for physics to become a CA and an economist. But having committed himself to a banker’s life, he’s done well. He knows the pulls and pressures of the job can be stressful and cycles every day to keep himself fit. He would love to play some cricket — he believes he could have been a good cricketer — but simply doesn’t have the time. He knows, it’s hard to get to the top, but it’s even harder to stay there.