Indian Bank conducted a conference call on 26 October 2023 to discuss its financial results for the quarter ended September 2023. Shanti Lal Jain, MD&CEO of the bank addressed the call:

Highlights:

The bank has recorded 10% growth in the business volumes to Rs 11.33 lakh crore. The deposits have increased 9% and advances moved up 12%.

The CASA deposits of the bank have increased 8% and the bank has continued to maintain healthy CASA are deposit ratio of above 41% end September 2023.

The bank has recorded 12% growth in the retail agriculture and MSME (RAM) loan book, while the corporate advances also moved up 11%.

Within the RAM segment, the retail loans have recorded 14% growth, agriculture 16% and MSME 5% end September 2023.

The bank has reduced gross NPA ratio to 4.97% and net NPA ratio to 0.6% end September 2023.

The provision coverage ratio has been raised to 95.64%.

The bank has maintained the trend of higher recovery and upgradations over fresh slippages of loans. The fresh slippages of loans was at Rs 1976 crore in Q2, while the recoveries and upgradations were higher at Rs 2265 crore.

The restructured loan book of the bank stood at Rs 9980 crore with 27% provisions end September 2023.

Including the profits for H1, the capital adequacy ratio would be higher by 100 bps. As per the bank, the internal accruals are sufficient to fund the credit growth of 12 to 14%.

The margins of the bank were impacted due to interest income reversals of Rs 276 crore in Q2FY2024

The bank is targeting loan growth of 10 to 12% and the deposit growth of 8 to 10% for FY2024.

About 64% of the loan book of the bank is linked to the MCLR and 31-32% is linked to the repo rate.

As per the bank, Rs 46500 crore of loan book is coming for repricing in Q3FY2024.

The bank is targeting recoveries and upgradations of Rs 8000 crore in FY2024 and it has already achieved recoveries and upgradations of Rs 4270 crore in H1FY2024.