Aditya Puri: the chartered accountant who built HDFC Bank

Commerce, a CA and Citibank

Aditya Puri was born in Gurdaspur district of Punjab. He studied commerce at Panjab University in Chandigarh and then qualified as a chartered accountant. In 2020 the Institute of Chartered Accountants of India inducted him into its Chartered Accountants Hall of Fame.

He spent much of his early career at Citibank, working in India and abroad. By 1992 he was the chief executive of Citibank in Malaysia, running a foreign bank in a foreign country.

“He turned a start-up into a banking giant, and helped bring Indians into the modern financial era.”

— Barron's, quoted by The Economic Times, via The Economic Times

Starting a bank from scratch

In September 1994 Puri returned home as managing director of a brand-new bank set up by HDFC, the housing finance company. The Hindu BusinessLine describes him as the founder managing director and chief executive, in charge from the bank's inception.

He stayed for twenty-six years. By 2018, according to the Economic Times, HDFC Bank had 43 million customers, 4,787 branches and 12,635 ATMs in 2,691 towns and cities.

He retired in October 2020, the longest-serving head of a private bank in India. Business Today notes that under him HDFC Bank became one of India's most valuable banks by market capitalisation.

What the numbers showed

A chartered accountant judges a business by its numbers, and the numbers under Puri were unusual. The Economic Times, reporting the 2018 Barron's list, noted that HDFC Bank's shares had delivered annualised returns of about 24 per cent since the bank began, that profits had grown nearly 20 per cent a year over the previous five years, and that the bank was worth about 77.6 billion dollars.

Hindustan Times, reporting the 2016 Fortune list, added that the bank had earned 1.9 billion dollars in profit the year before, and that its shares listed in the United States had risen about 2,200 per cent over fifteen years.

None of this came from one big gamble. It came from growing deposits and loans steadily, year after year, and from keeping bad loans low while competitors ran into trouble. That is the same patience a long professional course asks of a student.

Recognition

International magazines took notice. In 2016 Fortune ranked him 36th on its list of the world's top 50 business people, the only Indian on that list. In 2018 Barron's named him among its top 30 global chief executives for the fourth year in a row, alongside names like Jeff Bezos and Warren Buffett.

Barron's described him as a career banker who methodically built a start-up into India's second-largest private sector bank by serving the country's growing middle class, while avoiding the bad corporate loans and governance problems that hurt rivals. Investors, the magazine said, praised him in glowing terms even after twenty-four years at the top.

In 2020 he received a lifetime achievement award at the Euromoney Awards for Excellence. After retiring he joined the Strides group as an adviser in January 2021 and became a director of its biotech company Stelis Biopharma, saying he wanted to help build institutions that make affordable medicines.

The skills and habits that made the difference

The first was his accounting base. A bank is a balance sheet: deposits on one side, loans on the other, and risk in between. As a chartered accountant he could read that balance sheet line by line, which is the core of the caution Barron's praised.

The second was method. Barron's chose the word methodically for how he built the bank. Branch by branch and year by year, he grew it without chasing risky loans that looked attractive in the short run.

The third was learning abroad and applying at home. Years at Citibank, including running its Malaysian operation, taught him how a modern bank works. He brought those lessons to India when the opportunity came in 1994.