Highlights

The bank has continued to exhibit strong operating performance with improving net interest margin, deposit franchise getting stronger and granular and strong monitoring of asset quality and strengthening of balance sheet.

The bank is on track to achieve the retail wholesale loan mix of 55-45 with current mix improving to 54-46.

The gold loan growth is robust at 67% end December 2020 over December 2019.

The retail loan growth stands at 9%, while the bank is cautious in the corporate segment. The bank expects retail credit growth to improve ahead and targets 8-10% overall loan growth for FY2021.

The bank expects to launch credit cards business in March-April 2021.

The bank has materially raised provision coverage ratio material to 77.01% end December 2020, while bank aims to maintain provision coverage ratio excluding write-offs at 65-70%.

The fresh slippages remain under control and are in line with the guidance level.

The bank expects the restructuring requirement be at half of the earlier estimate. The bank has conducted restructuring of loans amounting to Rs 1067 crore and expect restructuring requirement of Rs 300 to 400 crore in Q4FY2021. Overall covid related restructuring is expected at Rs 1500-1600 crore compared with earlier estimate of Rs 3500 crore.

Bank intends to create 15-20% provision on the restructured book.

The gross NPA ratio stood at 2.7% and net NPA ratio at 0.6%, while including the proforma slippage the gross NPA ratio stands at 3.38% and net NPA ratio at 1.14% end December 2020.

The proforma slippages were Rs 1068 crore, of which Rs 234 crore related to Q2FY2021 and balance Rs 800 crore of proforma slippages related to Q3FY2021 that includes Rs 205 crore from IL&FS Infra account.

The bank has reversed interest income of Rs 73 crore on entire proforma slippages of Rs 1068 crore.

The collection efficiency remained stable at 95% in Q3FY2021, while the non-moratorium book collection efficiency is higher at 99%.

The SMA 1 and 2 loan book stands at 2.5-2.6% against pre-covid levels of 1.8%.

The bank has substantially strengthened its collection system and would help in supporting asset quality going forward.

The bank is well placed on provisioning front while it is awaiting regulatory clarity on further provisioning and utilization of provisions.

For a normal year, the bank continues to guide at credit cost of 60 to 70 bps.

The capital adequacy position of the bank is comfortable and the bank is not in a hurry to raise capital as and its business model does not consume much capital.

The bank may look at any capital raising only in the second half of calendar year 2021.

The bank has conducted disbursements of Rs 2600 crore under ECLGS scheme.

The bank has utilized covid related provisions of Rs 51 crore in Q3FY2021on account of restructuring of loans. The outstanding covid-19 related provisions stands at Rs 534 crore compared with Rs 587 crore a quarter ago.

The bank expects to maintain NIMs in the range of 3.15-20% and CASA at 33.5-34%.

The customer base of the bank stands at 80 lakh.

The board of the bank will approach RBI in advance for approval to extend the term of MD&CEO which will come to end in September 2021.