Shares of HDFC, HDFC Bank and HDFC jump 10 % each in early trade after the entities announced a scheme of merger on Monday

HDFC Bank share hikes 9.99 per cent to Rs 1,656.90 against the previous close of Rs 1,506.30 on BSE.

The merger between HDFC and HDFC Bank, 42 shares of HDFC Bank would be given for every 25 shares of HDFC.

The board of directors has also approval for the execution of an implementation agreement between HDFC and HDFC Bank.

The proposed transaction, will enable HDFC Bank to build its housing loan portfolio and enhance its existing customer base.

The proposed transaction is based on leveraging the significant complementarities that exist amongst the parties.

HDFC Bank is a private sector bank and has a large base of over 6.8 crore customers.

The bank platform will provide a well-diversified low-cost funding base for growing the long tenor loan book acquired by HDFC Bank.