HDFC Bank Limited ( HDB ) shares are trading lower on Friday.

The bank’s shares recorded their sharpest monthly decline following report of flat sequential deposit performance for the quarter ended June, Bloomberg reported.

The bank experienced a decrease in both advances and deposits sequentially for the quarter ending June 2024, reported Business Standard.

This decline comes after a sustained period of the bank’s stock price growth, driven by expectations of a higher weighting in the MSCI Emerging Market Index.

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This apart, Bloomberg added, citing people familiar with the discussions, that the banking giant is also considering selling a loan portfolio amid increased regulatory scrutiny of the nation’s lenders and a surge in credit growth the discussions.

India’s largest private sector bank has approached public sector lenders, non-banking finance companies, insurance companies, and asset managers to explore their interest in participating in the sale, the report read.

The Reserve Bank of India has focused attention on the credit-deposit ratio, which is at a decade high for India’s banking industry.

HDFC is considering selling parts of its loan portfolio to reduce this ratio, which rose after its 2023 merger with parent company HDFC Ltd., potentially bolstering liquidity as well.

Price Action: HDB shares are trading lower by 7.44% to $61.69 at last check Friday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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