Highlights:

The RBI has raised its policy repo rate by 250 bps in five consecutive policy meetings during the current financial year FY2023. The company has also raised its lending rate by 210 bps during the current financial year.

Loan book of the company has increased by 10% end December 2022 over December 2021. The individual loan book has increased by 14% and its share in the loan Book has increased to 83% end December 2022 up from 80% a year ago.

The disbursements stood at Rs 16100 crore in Q3FY23 with individual segment disbursements at Rs 13850 crore.

The net interest income has increased by 10%. Interest margin is stable at 2.42%. Better liability management and passing on of interest rate cost to the customers has contributed to the margin improvement

Asset quality trend is looking positive and improving. Stage 3 exposure has reduced to 4.75% end December 2022 as against 5.04% end December 2021 and 4.9% and September 2022.

The company has provided accelerated provisions of Rs 750 crore in Q3FY23 to enhance provision coverage ratio. Now stage 3 provision coverage ratio stands at 50.8% end December 2022 up from 43.6% a quarter ago and 39.7% a year ago. The bank has reached a comfortable level of provision coverage ratio and does not see any requirement of significant improvement in the provision coverage ratio ahead.

Cost of funds has increased to 7.4% up from 7.1% a quarter ago and 6.9% a year ago. An incremental cost of funds stands at 7.61% in Q3FY23.

The company has continued to guide at 15% slippage in the restructured loan book for the last 3 to 4 quarters.

The restructured loan book stands at Rs 1420 crore of which project loans stands at Rs 250 crore and retail loans at Rs 1159 crore. As per the company, Rs 600 crore of restructured loan book is expected to come out of moratorium by March 2023, another Rs 600 crore by June 2023 and rest by September 2023.

The original restructured loan book of the company was at Rs 7200 crore of which Rs 5200 crore has come out of moratorium and Rs 700 crore has been repaid.

The stage 3 assets in the individual housing loan segment stands at 1.62%, non housing individual segment at 6.74% and corporate non individual at 22.5%. Thus, the stage 3 in retail segment stands at 2.9% and project loans at 45.6%. The overall stage 3 asset assets stand at 4.75% end December 2022.

The bank is expecting it disbursements growth of around 13% for Q4FY23

An incremental yield on loan stands above 9%.

The number of accounts in the project loan segment stands at 300 of which 80 accounts are in the stage 3 and another 20 to 30 accounts are in and 60 + DPD end December 2022.