HDFC Bank faces scrutiny as credit growth lags deposit expansion

HDFC Bank’s Q2 performance has drawn regulator and investor attention after deposit growth outpaced lending, narrowing its net interest margin. Analysts cite tighter liquidity and slower retail credit disbursal as contributing factors. The Reserve Bank of India is reviewing banks’ loan-to-deposit ratios amid funding pressure. Market participants expect HDFC Bank to prioritize corporate lending and digital channels to offset margin compression. The stock slipped about 1% in early trade, tracking cautious sector sentiment across private lenders.