HDFC bank hit pause in Dubai

HDFC Bank, India’s largest private sector lender, has been prohibited from onboarding new customers at its Dubai International Financial Centre (DIFC) branch by the Dubai Financial Services Authority (DFSA).

The bank said it has received a formal “decision notice” from the DFSA, which cites alleged violations related to the financial services offered by the DIFC branch. The notice also mentions issues in onboarding customers at the branch. HDFC Bank did not provide specific details of the alleged violations, and the exact nature of the infractions remains unclear.

In addition to the restriction on new accounts, HDFC Bank has been barred from soliciting new customers. However, the bank will continue to service its existing clientele. The DIFC branch currently has 1,489 customers, including joint accounts.

HDFC Bank stated that it has initiated the necessary steps to comply with the DFSA notice and is committed to working with the regulator to address its concerns. The bank also noted that it does not anticipate any material impact from the regulatory action.

The restrictions will remain in force until HDFC Bank receives written communication from the DFSA amending or revoking the decision.

On the stock market, HDFC Bank shares closed 0.47 per cent lower at Rs 945.15 per share on the Bombay Stock Exchange on Friday, compared with a 0.90 per cent decline in the benchmark index.

HDFC Bank emphasised that it is taking steps to remediate the concerns raised by the DFSA and will continue to serve its existing customers in Dubai without disruption.