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Deepak Parekh: An unofficial crisis consultant

Tamal Bandyopadhyay | October 06, 2003

Deepak ParekhOn October 4, when the group of ministers met to take a final decision on the unified licensing regime in telecom, it did so after sitting through presentations by the Telecom Regulatory Authority of India and Housing Development Finance Corporation chief Deepak Shantilal Parekh.

The involvement of the chief of India's largest housing finance company in as contentious an issue as telecom licensing attracted little comment.

That in itself is telling. Parekh, who turns 59 on October 18, has become something of an unofficial crisis consultant for the government in recent years.

It was Parekh who chalked out the rescue plan for the former Unit Trust of India during its first crisis in the late nineties.

Telecom, however, marks a new advisory foray for Parekh. In the past, his role in policy-making has been mostly connected with banking and finance.

Indeed, he seems to have had a monopoly on memberships to key committees -- the Malhotra committee on insurance reforms, the Narasimham committee on banking reforms and the panel that did the groundwork for a housing finance regulator.

His membership of the infrastructure task force of the Prime Minister's Office may have influenced the government's request for advice on telecom licensing.

Yet banking is in Parekh's genes. His grandfather was the first employee of Central Bank. His father spent 40 years in the same bank and retired as deputy managing director. His uncle was the legendary H T Parekh -- the man who founded HDFC in 1977.

After graduating from Mumbai's Sydenham College in 1965, Parekh qualified as a chartered accountant in England and worked with Ernst & Young, Precision Fasteners, ANZ Grindlays and Chase Manhattan in New York and Mumbai. It was his uncle who brought Parekh to HDFC in 1987.

"How long will you continue to go round the world? Come and settle down, this is an Indian organisation," HT told him. Parekh, 34 then, took a 50 per cent cut in his Chase Manhattan salary and joined HDFC as a deputy general manager.

Today, HDFC has a balance sheet size of Rs 28,000 crore (Rs 280 billion). From a single-product company that focussed on the Indian middle class to develop the mortgage market, the HDFC family offers a buffet of every possible financial product.

There is HDFC Bank, a life insurance company with Standard Life, a general insurance outfit with Chubb, a mutual fund again with Standard Life, a brokerage with Chase, a credit information bureau with Dun & Bradstreet and even a business process outsourcing venture with TCS.

The group asset size is over Rs 70,000 crore (Rs 700 billion).

HDFC was H T Parekh's creation but it was Deepak Parekh's vision and entrepreneurship that have built the empire. As an insider puts it, Parekh runs HDFC as if he owns it. He is manager, entrepreneur and leader rolled into one.

But HDFC employees know a different Parekh: a tough taskmaster, yet always accessible and helpful. It is telling that none of HDFC's senior employees -- directors, general managers and deputy general managers -- have left the organisation over the past decade. "He can cram a 48-hour schedule into 24 hours," says one of his close colleagues.

When he is not travelling he comes to office in a chauffer-driven Toyota Camry and normally does not leave work before eight in the evening. He has three secretaries and never uses a computer -- his brain has enough capacity, HDFC insiders say.

But Parekh is no workaholic suit. He is a familiar face on Mumbai's social circuit and has the record of attending six parties a day. He socialises to network, which is important in the financial sector.

His close friends say he does not drink at any of these parties, though he does enjoy an occasional good whisky -- a 30-year-old Ballantyne being his favourite -- and his Sunday afternoon beer (Heineken or Becks) with friends.

Well-known food critic Rashmi Uday Singh says Parekh loves chocolate-covered biscuits and good food.

He is fond of Hindi music and playing bridge. Despite his hectic schedule Parekh never misses Wimbledon or the cricket matches at Sharjah.

Parekh admires Dhirubhai Ambani, Narayana Murthy and Kumar Managalam Birla, the last named for taking so much responsibility at such a young age.

But when it comes to hero worship, his choice is Keshub Mahindra, who has been vice-chairman of HDFC since its inception. "I look up to Keshub for everything," Parekh once said.

Parekh's vision for HDFC is to make it the GE Capital of India. His critics say this is possible if HDFC merges with the bank because the housing finance company may not be able to hold on its own against the fierce competition put up by commercial banks.

Parekh, however, thinks a merger brings no value-addition. He should know what he is talking about: after all, Deepak Parekh, the brand, is no smaller than HDFC.

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