Highlights:

The economic activity was improving till March 2021, but a second wave halted the recovery.

As per the bank the retail and MSME sectors have been affected by lockdown in various parts of the country. The bank is closely watching and reviewing second wave impact on these sectors.

The bank expects to raise equity capital of Rs 510 crore in Q2FY2022 or early Q3FY2022. In the first tranche the bank had raised Rs 240 crore in Q4FY2021 out of proposed capital raising of Rs 750 crore.

The bank has improved CASA deposits ratio above 30% level for the first time to 30.4% end June 2021.

The bank has exhibited a 52% decline in bulk deposits. NRI deposits moved up 8% accounting for 31% of the total deposits.

The bank has recorded 32% growth in the NRI remittance business.

The bank has exhibited an improvement in the cost-to-income ratio to 48.5%, while its taking various initiatives to improve the cost to income ratio.

The bank is also taking a number of initiatives to improve competency and compliance.

The strong focus on improving ease and convenience to the customers.

The corporate loan book of the bank has declined 22%, while the focus is on source quality customer rated A and above in the corporate book.

The bank does not expect much decline in corporate book. The focus is on the personal and business loans segment for growth.

The bank has revamped the structure of the retail loan segment for quality sourcing. Within the retail segment, the bank is very positive on the gold loan segment.

The GNPA in the gold loan segment stood at 0.3% mainly on account of delay in auctions.

As per the bank, the loan book has declined due to limited opportunities. The bank expects reasonable uptick in credit growth in H2.

The bank had earlier targeted to grow loan book by Rs 10000 crore, but after the second covid wave the bank is now targeting to grow loan book by Rs 5000-6000 crore in FY2022.

The fresh slippages of loan stood at Rs 879 crore in Q1FY2022, mainly contributed by personal and business loan segments. The corporate loan segment contributed fresh slippages of Rs 168 crore in Q1FY2022, which came from real estate, hyper market, data management etc segments.

The corporate loan book stands at Rs 14227 crore with NPAs at Rs 1505 crore.

The bank has restructured loans amounting to Rs 691 crore in Q1FY2022. Under RBI restructuring guidelines 1.0 the bank has restructured loans of Rs 548 crore, while it has also restructured loans of Rs 71 crore under RBI restructuring guidelines 2.0 in Q1FY2022.

The bank expects further restructuring of Rs 700 crore under RBI restructuring guidelines 2.0 by September or December 2021.

As per the bank, the slippage rate for the restructured loan book has been 25-30%.

The bank witnessed decline in collection efficiency in April-May 2021, but improved from June 2021.

The recovery and upgradations of loans stood at Rs 349 crore in Q1FY2022.

The bank has restructured and upgraded one corporate account of Rs 207 crore, which was classified as NPA in the previous quarter.

The bank has posted robust 59% growth in the other income driven by surge treasury and forex income.

The income of sales of priority sector lending certificates surged to Rs 80 crore in Q1FY2022 from Rs 15 crore in Q4FY2021 and Rs 34 crore in Q1FY2021.

The provision coverage ratio has improved to 60.1% end June 2021 from 58.7% end March 2021. Provision coverage ratio excluding write offs has improved to 38% from 34% during Q1FY2022.

The bank expects to maintain provision coverage ratio at 60-65% and excluding write off at around 40%.

The bank expects slippages to remain elevated at Rs 2500 crore for FY2022 similar to FY2021. The fresh slippage ratio is expected to be 2.5% for FY2022.

For Q2FY2022, the bank is expecting slippages of Rs 600-700 crore.

Bank expects a provisioning requirement of Rs 1500-1600 crore for FY2022.

The interest income reversals stood at Rs 41 crore in Q1FY2022 on account of higher slippages of loans.

Under ECLGS scheme 1 the bank has disbursed loans of Rs 2600 crore, Rs 112 crore under ECLGS 2, Rs 7 crore under ECLGS 3 and nil under ECLGS 4.

The bank is tying up with various hospitals for speedy vaccination of its staff and expects most of the staff to be vaccinated by September 2021.