Highlights:

The bank has made provisions of Rs 156 crore for MTM loss on investment book in the quarter June 2022. The bank has charged this provision to interest income line, which has moderated the interest income growth to 6%, excluding which the interest income growth would have been higher at 17%.

One corporate account of Rs 308 crore has contributed to the fresh slippages of loans in the quarter ended June 2022 causing sequential increase in gross NPA ratio of the bank. However, the bank has still improved GNPA ratio over a year ago level.

However, the same account has been recovered during the first week of July 2022.

This also contributed to the higher slippages ratio of 1.03%, while excluding this account at the slippage ratio is lower at 0.47% compared with 0.73% in the previous quarter.

The credit cost is also higher at 0.69%, while excluding the account the credit cost is lower at 0.16% compared with 0.21% in the previous quarter and 0.45% in the corresponding quarter last year.

Despite the impact of the account, the net interest income of the bank has increased 20% and the net profit has increased 8% in the quarter in the June 2022.

The bank has also increased its net interest marching to 3.33% in the quarter and the June 2022 from 3.15% in the previous quarter and 2.98% in the corresponding quarter last year.

The net NPA ratio has declined to 2.16% from 2.42% a quarter ago.

The provision coverage ratio has increased to 76.77% from 73.47% quarter ago. The bank expects maintain provision coverage ratio of 72 - 75%.

The advances of the bank have increased 13%, while the Casa deposits have increased 12.5%. The Casa ratio has improved to 32.8% from 30.97% a quarter ago.

The bank is focusing on maintaining strong growth in the loan book and Casa deposits.

Bank aims to improve asset quality by focusing on credit monitoring and reducing slippages.

The bank is targeting loan growth of above 15% for FY2023

GNPA ratio excluding the accounts stands at 3.51%.

The bank is looking at capital raising from various options.

About 52% of the loan book is linked to the external benchmark lending rates.

The bank is looking at credit to deposit ratio of 73 to 75%.

The bank expects the trend of decline in gross NPA and net NPA ratio to continue ahead. The bank expects to reduce gross NPA ratio to 3% and net NPA ratio to 2%.

The bank expects to reduce credit cost to below 0.5-0.6% in FY2023.