A big revelation has come to light regarding India's two giant financial institutions HDFC and ICICI. This was revealed by Deepak Parekh, former Chairman of HDFC Limited, during a conversation with Chanda Kochhar, former Chief Executive Officer (CEO) of ICICI Bank. Former HDFC Chairman Deepak Parekh, during a conversation on the YouTube channel of former ICICI Bank CEO Chanda Kochhar, said that ICICI once wanted to acquire HDFC.
While the attempt was ultimately rebuffed, Parekh’s remarks shed light on what could have been one of the most consequential mergers in Indian banking history — one that, if accepted, might have entirely redrawn the map of the nation’s financial ecosystem.
A Deal That Never Happened — But Almost Did
During the recorded discussion, Parekh casually dropped the bombshell: “ICICI had reached out to us, asking if we were open to selling HDFC. We politely declined.”
According to Parekh, the approach by ICICI Bank — now one of India’s top private lenders — came well before the eventual 2023 merger of HDFC with its banking arm, HDFC Bank. He offered no specific date, but emphasized that the pitch was serious enough to prompt internal deliberations at HDFC.
“We believed in HDFC’s independent identity,” Parekh said. “And at that time, merging with ICICI didn’t feel aligned with our long-term vision.”
The “Natural” HDFC-HDFC Bank Merger
Instead of merging with ICICI, HDFC eventually found its strategic synergy with its own subsidiary, HDFC Bank. The merger—which is officially completed in July 2023—was the largest in the history of India's banking sector, creating a financial powerhouse whose combined market capitalisation briefly surpassed that of ICICI Bank.
Parekh described the combination of HDFC and HDFC Bank as a "natural progression", driven by changing market needs, regulatory changes and a shared customer-first philosophy.
“It made sense for us to integrate with an entity that shared not only our name but also our DNA,” he explained.
RBI’s Crucial Role in the Final Merger
Parekh was quick to acknowledge the pivotal role of the Reserve Bank of India (RBI) in facilitating the merger between HDFC and HDFC Bank.“The RBI was not just supportive — it was visionary. They saw the long-term value this consolidation could bring to the Indian economy,” he said.
The merger process, involving complex regulatory frameworks and compliance layers, was cleared in record time. The RBI’s understanding and backing helped smooth what could have otherwise been a long and drawn-out integration.
A ‘What If’ That Might Have Changed Everything
Had ICICI succeeded in acquiring HDFC, analysts suggest that India’s private banking space could have consolidated far earlier — and very differently.
“Had HDFC merged with ICICI Bank, we could have seen a megabank rivaling not just domestic institutions but also major Asian financial giants,” said Shruti Kannan, a senior economist at a Mumbai-based think tank.