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HDFC Bank vs State Bank of India

Side-by-side credit pricing comparison from Pillar 3 disclosures.

Last updated: March 2026 · Data source: public Pillar 3 disclosures
Verdict:

On a representative BBB+ EUR 25M 5-year term loan, HDFC Bank is the cheaper lender by 10bp in minimum spread. For a EUR 25M facility, that's EUR 23,958 per year.

Bank profiles compared

Metric HDFC Bank
India		 State Bank of India
India
IRB approachStandardisedStandardised
Cost-to-income40.5%54.0%
Effective tax rate25.0%25.0%
Avg corporate PD1.10%1.80%
Avg LGD unsecured45.0%45.0%
Avg LGD secured25.0%25.0%
Funding spread (bp)15bp20bp
Corporate EADEUR 4926bnEUR 12410bn

Sample RAROC: BBB+ EUR 25M 5Y term loan

Both banks priced on the exact same deal — 150bp spread, 20bp commitment fee, 60-month maturity. Higher RAROC means the bank earns more from this deal. Lower min-spread means the borrower gets a better rate.

Component HDFC Bank State Bank of India
Annual revenueEUR 385,000EUR 385,000
Operating costEUR 154,000EUR 154,000
Expected lossEUR 28,750EUR 28,750
Capital required (FPE)EUR 2,451,320EUR 2,451,320
RAROC (after tax)7.31%6.87%
Min spread for 12% RAROC252bp262bp
This is just one sample deal.

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HDFC Bank full profile State Bank of India full profile All banks RAROC methodology

FAQ: HDFC Bank vs State Bank of India

Which bank is cheaper on corporate credit: HDFC Bank or State Bank of India?
On a BBB+ EUR 25M 5-year term loan, HDFC Bank requires a minimum spread of 252bp to reach a 12% RAROC hurdle, versus 262bp at the other bank — a difference of 10bp on the same deal.
How do HDFC Bank and State Bank of India compare on corporate PD?
HDFC Bank reports an EAD-weighted corporate PD of 1.10%, while State Bank of India reports 1.80%. The gap reflects differences in obligor mix and geography rather than underwriting quality.
How do the two banks differ on IRB approach?
HDFC Bank uses Standardised and State Bank of India uses Standardised. The IRB approach determines whether internal LGD models or supervisory LGDs apply, which materially affects capital required on every corporate facility.
What deal is used in this comparison?
A single standardised facility: BBB+ rated, EUR 25M drawn on a EUR 30M commitment, 5-year tenor, 150bp spread, 20bp commitment fee. Both banks are priced on this exact deal using their own disclosed Pillar 3 parameters.