Bandhan Bank Limited (BANDHANBNK.NS) Q2 FY2026 Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Bandhan Bank Q2 FY '26 Earnings Conference Call. [Operator Instructions] I now hand the conference over to Mr. Vikash Mundhra, Head of Investor Relations. Thank you, and over to you, sir.

Thank you, Danish. Good evening, everyone, and a very warm welcome to all of you. It's a pleasure to have you with us today as we discuss Bandhan Bank's business and financial performance for the quarter and half year ended September 2025. We apologize for the late start and appreciate your time and continued interest in the bank. I also hope you all had a joyous festive season and wish you and your family good health, happiness and prosperity in the month ahead. In today's call, we will take you through our business performance, key achievements and challenges during the quarter. Joining us on the call today are Mr. Partha Pratim Sengupta sir, Managing Director and Chief Executive Officer; Mr. Ratan Kumar Kesh, Executive Director and Chief Operating Officer; Mr. Rajinder Kumar Babbar, Executive Director and Chief Business Officer; Mr. Rajeev Mantri, Chief Financial Officer; and myself, Vikash Mundhra, Head of Investor Relations; and other members of our senior management team. After the management's remarks, we will be happy to take your questions and provide any additional clarity on the quarter's performance and our outlook. With that, I would now like to invite our Managing Director and CEO, Mr. Partha Pratim Sengupta sir to share his thoughts on the bank's performance for the quarter. Over to you, sir.

Thank you, Vikash. Good evening, everyone, and thank you for joining us today. On behalf of Bandhan Bank, I would like to extend a very warm welcome to all participants on our earnings call for the second quarter of financial year '25-'26. I hope you and your families had a wonderful and fulfilling Diwali. I wish you continued good health and happiness in the festive season ahead. This quarter's performance reflects a transitional phase for the bank as we continue to realign our portfolio and operating model in response to the changing environment. The recent 75 basis point repo cut in Q1, which we proactively passed on to our customers on the first day of Q2 had a short-term impact on the margins. However, this is part of the adjustment process that will position us well for sustainable growth ahead. As the repricing of deposits takes place over the next few quarters, we expect to see the full benefit of lower funding cost, which will help improve margins and support profitability. Before delving into the quarter's performance, let me begin with a few initiatives we undertook during the quarter to improvise our products and services with innovative solutions and to better serve our customers. We continue to focus on strengthening our granular liability franchise through innovative and targeted offerings. We have successfully launched the Grow CASA Grow Together campaign and exclusive CASA drive aimed at promoting current and savings account growth across segments. This initiative is gaining traction and is already yielding encouraging results. This reinforces our commitment to building strong long-term relationships with our customers. We further placed emphasis on sourcing new corporate salary accounts by leveraging our revamped salary product offering. This initiative allows us to provide a more seamless and rewarding banking experience to employees of partner company while expanding our CASA base in a sustainable manner. The bank introduced specialized products for HNI individuals, including the Elite, Elite Plus, and Legacy Savings Accounts. It is designed to meet the unique needs of our HNI customers. These offerings not only enhance our value proposition, but also deepen relationship with this key customer segment. Through this focused initiative, we are confident of driving CASA growth, enhancing customer engagement and delivering long-term value for all stakeholders. We have made good progress in strengthening our digital and government ecosystem partnerships. I'm pleased to share that Bandhan Bank has successfully integrated with the Central Board of Indirect Taxes and Customs for the collection of customs duty through their corporate Internet banking platform. This initiative enhances our role in facilitating seamless digital payments from government collections. Further, the bank has also integrated with Khajane 2 payment system, a comprehensive digital platform of the Government of Karnataka. This system enables the state to manage all their financial transactions digitally, including revenue receipts and payments to employees, suppliers and contractors. Through this integration, Bandhan Bank now becomes part of the unified e-payment gateway that ensures real-time transaction recording, secure processing and online challan generation for various government deals. In addition, the bank is also integrated with the integrated financial management system in the states of Rajasthan, allows for efficient registration of bank accounts and real-time reporting of account balances with the respective government department, further strengthening transparency and efficiency in public finance management. These initiatives reflect our continuous effort to enhance digital capabilities, deepen relationships with government entities and support the nation's digital transformation journey. On the collection front, we continue to focus on enhancing customer convenience and improving the repayment experience. During the quarter, we introduced unique QR codes for our EEB customers and integrated them with the BBPS ecosystem. In addition, we launched a web-based collection module, enabling our customers to repay EMIs across products such as personal loans, auto loans and 2-wheeler loans with greater ease. With these initiatives, our customers now have multiple repayment options through the mBandhan app, retail Internet banking or via over 700 partner apps and web links. These steps significantly reduces friction, simplifies the repayment process and enhances the overall customer experience. We believe these enhancements not only improve convenience for our customers, but also strengthen collections efficiency and contribute to the bank's broader focus on digital innovation and customer centricity. I now move to the performance of Bandhan Bank for the Q2 financial year '26 and the first half of financial year '26. I would like to candidly acknowledge that our Q2 FY '26 performance were somewhat below than our internal expectations. However, the underlying trends and structural improvements give us confidence for an improving second half. There are a few factors that contributed to the softer Q2 FY '26 performance outcome. Firstly, the 75 basis points repo cut impacted around 45% of our advances and the 200 basis points reduction in MCLR affected another 5% of our loan book, which moderated the interest income growth during the quarter. We have partly offset this impact to reducing cost of savings accounts. However, the larger benefit from lower cost of term deposits will come through mainly from Q4 onwards. Secondly, slippages remain elevated, reflecting the ongoing stress in the EEB segment, which was anticipated to get corrected during the quarter, but since that it will continue for 1, 2 months more. Thirdly, growth in our EEB portfolio remains subdued as the full impact of the industry-level guardrails is taking longer time to materialize than anticipated. And finally, our advances growth came largely during the end of the quarter, mostly during the last month of the quarter, which made limited contribution to the profit and loss in Q2. While these factors moderated our near-term performance, we remain confident in the bank's underlying strength. The initiatives we have undertaken, including enhanced collections, strengthened risk management and disciplined growth strategies are already in motion. We expect these measures to translate into improved growth and profitability in the upcoming quarters. On a positive note, there are some encouraging developments during this quarter. Firstly, growth in our non-EEB book remains strong, reflecting the resilience and diversification of our loan portfolio. At the same time, the share of secured assets continue to rise, which strengthens the overall quality of our advances. We are also seeing renewed momentum in CASA, which is a testament to our focused efforts in building a strong and stable deposit base. In parallel, our reliance on bulk deposits continues to decline, supporting a more granular and sustainable funding profile. From an operational perspective, our OpEx to asset ratio improved during the quarter, highlighting disciplined cost management. Importantly, in the EEB segment, SMA-1 and SMA-2 balances have declined sequentially, signaling early signs of improvement in asset quality that we expect to be reflected in the coming quarters. Finally, the bank's capital and liquidity position remains robust, providing a strong foundation to support future growth and strategic initiatives. Taken together, these developments give us confidence in the resilience efficiency and long-term growth potential of Bandhan Bank, and we remain optimistic about translating this strength into improved performance in the quarters ahead. While my colleague and Chief Financial Officer, Mr. Rajeev Mantri, will provide a comprehensive overview of the financials, I would like to take this opportunity to highlight a few key developments and performance indicators from the second quarter. As of September 30, 2025, our gross advances stood at about INR 1.40 lakh crores, reflecting a Y-o-Y growth of 7%. On the liability side, total deposits reached INR 1.58 lakh crores, growing by a healthy 11% Y-o-Y and importantly, outpacing the growth in advances. This clearly reflects our strategic emphasis on maintaining a healthy balance sheet that supports the sustainable growth. Our retail term deposits continued to show strong momentum, growing by 38% Y-on-Y. This growth reflects the increasing trust and engagement of our individual customers and the effectiveness of our distribution network. Our CASA deposits now account for 28% of the total deposit base and the overall share of retail deposits, including CASA and retail term deposits, it improved to 71% compared to 68% in the previous quarter. This demonstrates a strong improvement in the granularity and stability of our deposit base, aligning well with our focus on building a sustainable and customer-driven franchise. We continue to execute our diversification strategy with steady progress. During the quarter, our secured book recorded a Y-o-Y growth of 25%, resulting in an improvement in the secured portfolio mix to 55% compared to 47% a year ago. Our NIM for Q2 financial year '26 stood at 5.8%, reflecting some pressure mainly due to the impact of the repo rate moderation. That said, margins continue to remain at a healthy level. For half year financial year '26, NIM was at 6.1%. Credit costs show a small improvement sequentially, and we remain committed to bringing them down further throughout the year. We also undertook technical write-offs of about INR 865 crores during the quarter. Gross and net NPA ratios remained stable at 5% and 1.4%, respectively, while our PCR, including technical write-offs, improved slightly to 87.6%. For quarter 2 financial year '26, our net income stood at INR 3,135 crores, while operating profit was at INR 1,310 crores. The bank reported a PAT of INR 112 crores for the quarter. For half year financial year '26 ROA and ROE stood at 0.5% and 4%, respectively. Our capital position remains strong, including Q2 FY '26 profit, thus capital adequacy ratio stands at 18.6% and Tier 1 capital at 17.8%, providing adequate headroom to support future growth. Our branch network expanded to 1,754 branches with the addition of 4 new branches during the quarter. As the micro finance environment moves to a stability, we remain confident in our ability to leverage the emerging opportunities ahead. Our focus will firmly remain on prudent risk management, disciplined execution and identify new avenues of growth while continuously enhancing operational efficiency to drive sustained performance. Before I conclude, I'd like to reiterate that over the last year, we have articulated the Bandhan 2 strategy and have taken business to achieve the same. We have taken steps to transition from a microfinance-focused bank to a full service commercial bank. The focus of our transformation initiative has centered around the seamless integrated customer journey and a broad-based presence in various banking segments driven by technology and cost efficiencies. Risk, compliance and governance are the pillars on which we are moving ahead. These measures are being taken to achieve long-term value creation for our shareholders. However, during a transition, we may witness short-term pain, but I see good green shoots and I'm confident that in the long run, we will achieve balanced profitable growth with a focus on enhancing shareholder value. With that, I would now like to invite our Chief Financial Officer, Mr. Rajeev Mantri, to take you through the detailed financial performance for the quarter. Thank you all.

Thank you, Partha sir, and I welcome again, everyone, to the earnings call. We will now move on to the business performance for the quarter. I'll walk you through the key financial highlights and provide an overview of how we have performed. We'll start with the advances. As of September 2025, the gross advances stood at INR 1.4 lakh crores, reflecting a growth of 7% year-on-year and on a sequential basis, the growth was healthy at 5%. Our emerging entrepreneur business or EEP portfolio stood at INR 51,733 crores as of September 30, 2025, reflecting a decline of 13% year-on-year and 2% sequentially. However, if we adjust for the technical write-offs undertaken during the quarter, the portfolio would have remained broadly flat on a sequential basis. This is a result of steps taken to arrest the decline in EEB book, while ensuring that the portfolio controls and guardrails continue to be implemented to manage elevated sectoral risks. With the operating environment showing some signs of recovery, we are expecting to see gradual growth in the EEB portfolio from Q3 onwards, supported by prudent lending, improvement in collections and strengthened field discipline. Our non-EEB portfolio continues to deliver strong broad-based growth. It now accounts for nearly 63% of total advances, up from 60% last quarter and 55% a year ago. The portfolio grew 24% year-on-year, driven by sustained momentum across both retail assets as well as wholesale banking. Retail assets grew by 66% year-on-year, led by secured products, such as commercial vehicle and equipment loans, auto loans and gold loans. Wholesale banking also performed very well, recording a 27% year-on-year increase, reflecting strong client engagement and execution. Overall, these results highlight the strength of our diversified growth strategy and continued expansion of our high-quality non-EEB franchise. Driven by focus on diversification and enhancing asset quality, we have further strengthened the secured loan portfolio driven by wholesale banking, housing and retail. The secured loan book grew 25% year-on-year and now accounts for 55% of the total advances, reflecting the steady shift towards a more secure and balanced asset base. From a business mix perspective, our advances remain well diversified across the various segments. The EEB group lending accounted for 24% of total advances, SBAL stood at 13%, wholesale banking at 29%, housing at 24% and retail assets at 9%. This balanced distribution highlights a conscious effort to reduce concentration and strengthen the portfolio stability and resilience. Moving to liabilities. As of September 30, 2025, our total deposits stood at INR 1.58 lakh crores compared to INR 1.43 lakh crores a year ago, reflecting a growth of 11% year-on-year. The deposit growth continues to outpace the expansion in our advances, underscoring our strategic focus on balance sheet resilience and stable funding base. We remain firmly focused on building a granular and stable deposit base with emphasis on growing our retail deposits. Our total retail deposits comprising both CASA and retail term deposits grew by 16% year-on-year. Within this, retail term deposits showed strong momentum, recording a robust growth of 38% year-on-year, reflecting the trust and confidence our customers continue to place in the bank. The proportion of bulk deposits to total deposits declined to around 29% from 32% a year ago. This downward trend reflects our focus on enhancing stability and granularity of our funding base. Our CASA deposits stood at INR 44,211 crores, reflecting a 6.5% decline year-on-year. This was primarily due to savings interest rate reduction implemented in Q1, which led to some outflow from savings accounts and some shift towards retail term deposits. However, it has helped us in terms of reducing the cost of funds for savings as well. However, during the quarter, we have arrested the decline in savings balances and savings accounts grew sequentially by 3.2%. Overall, CASA is showing signs of recovery, registering a 5.6% sequential growth. Moving to collection and asset quality. The bank's overall collection efficiency, including -- excluding NPAs, stood at 98.0% for Q2 FY '26 compared to 97.9% in Q1 FY '26. Within the EEB portfolio, collection efficiency for the month of September was at 97.5%. And for the full quarter of Q2, it was 97.8% compared to 97.6% for Q1 FY '26. For additional information on collection efficiency, we have a detailed Slide 19 in our investor deck. On the asset quality front, while headline metrics remained largely stable quarter-on-quarter, gross slippages at the overall bank level increased slightly to INR 1,590 crores compared to INR 1,553 crores in the previous quarter, primarily driven by the EEB segment. Slippages in the EEB portfolio were higher at INR 1,118 crores during the quarter versus INR 1,089 crores in the preceding quarter, reflecting ongoing stress in the segment. Recoveries and upgrades during the quarter stood at INR 332 crores, marginally better versus INR 319 crores recorded in Q1 FY '26, which is at the overall bank level. While we observed some higher slippages in the EEB segment, there are signs of improvement in the SMA-1 and SMA-2 books. As of second quarter FY '26, the SMA-1 book of EEB has improved to INR 527 crores compared to INR 532 crores in the previous quarter and the SMA-2 book stands at INR 388 crores versus INR 484 crores in the last quarter. The increase, however, in the EEB SMA-0 book is largely due to the impact of raising installment demand on holidays. As we had mentioned earlier, when there is a holiday, we actually see some bit of an increase in the SMA-0 book. And therefore, that we saw in this particular quarter as well. If we adjust for this increase in the holiday-related impact, we actually see a sequential improvement in the SMA-0 book as well for EEB. Out of the total EEB SMA-0 book of INR 1,582 crores as of the end of Q2 FY '26 as against INR 1,009 crores in Q1 FY '26, nearly INR 650 crores of the increase occurred due to the holiday effect in late September on account of the festive season. And we have already recovered approximately INR 350 crores during October so far out of this INR 650 crores. Additionally, the bank undertook technical write-offs amounting to INR 865 crores during the quarter, of which write-off in the EEB portfolio was INR 799 crores. Consequently, the gross NPA and the net NPA ratio at the bank level were largely stable quarter-on-quarter at 5% and 1.4%, respectively. Credit costs improved marginally and stands at 3.4% for Q2 versus 3.5% in Q1 FY '26. The PCR, excluding write-offs, remained stable quarter-on-quarter at 73.7%. Turning to the quarterly profit/loss statement. In Q2, our NII stood at INR 2,589 crores, reflecting a year-on-year moderation of 12%. Our net interest margin for the quarter came in at 5.8% for Q2 compared to 6.4% in Q1 FY '26. This movement was mainly on account of the full impact of 75 basis points repo rate reduction implemented in the current quarter, which had a bearing on our advanced yields. In addition, the growing share of secured loans in our portfolio and some continued stress from elevated slippages also influenced the margin trajectory. We have taken proactive steps to mitigate this impact, including a calibrated reduction in the cost of our savings account rates. We expect to see further benefit from lower term deposit costs flowing through from the fourth quarter onwards, which should help support margin improvement going forward. Our noninterest income moderated by 10% year-on-year and 25% quarter-on-quarter, primarily due to lower treasury gains during the quarter. In the last quarter, we actually had good treasury gains. We continue to make strong progress in diversifying the revenue base. Income from third-party products grew by a robust 48% year-on-year underscoring the success of our cross-sell and customer engagement initiatives. Operating expenses for Q2 FY '26 remained largely stable at INR 1,825 crores, reflecting our continued focus on disciplined cost management. The OpEx to average assets ratio stood at 3.8% for the quarter, making a sequential improvement of 9 basis points. Operating profit for the quarter was INR 1,310 crores. The bank reported a net profit of INR 112 crores for the quarter as compared to INR 937 crores in Q2 FY '25 and INR 372 crores in Q1 FY '26. For the half year FY 2026, we had NII and operating profit at INR 5,346 crores and INR 2,979 crores, respectively. The net interest margin, operating expense to asset ratio and credit costs were at 6.1%, 3.8% and 3.4%, respectively. The bank reported a net profit of INR 484 crores in the first half of FY '26, with an annualized ROA of 0.5% and ROE of 4%. Thank you for your time and listening to all our updates. On behalf of the entire management team, I would like to once again thank all the participants for joining us today. We appreciate your continued interest and support. With that, we will now open the floor for questions.

[Operator Instructions] Our first question comes from the line of Mahrukh Adajania from Nuvama.

So I had a couple of questions. Where do you expect the full year and the 2-year credit cost to settle, right? And I understand that there were holidays, but even so there's like a 54% increase in SMA-0, which is the sharpest? I know you explained, but even so. So where do you see the SMA-0 -- you gave some October numbers, but where do you see the SMA-0 settling in the third quarter? And also, if you could highlight on the credit cost. That's my first question. My second question is that your PPOP margin, right, PPOP to assets has really fallen to a low in the second quarter and it hardly -- I mean, there's very little margin now to cover the credit costs, right? So how do you strengthen the PPOP margin because the book will play out in terms of the change in mix and its impact on margins. So what are the levers we have to improve the PPOP margin to take care of the volatility in credit cost? And my third question is that in the Bihar election manifestos of opposition parties, debt waiver figures and a lot of soft to self-help groups are being talked about. So how much of that would you expect to rub off to MFI in case these things come through in Bihar? These are my questions.

So first of all, to answer your query on credit costs. So we have a guidance for the next 2, 3 years, where we have said that we should come to around 2.5%. So this is a transition phase. As we have already said during this transition phase, the NPAs are going to rise as you have seen that we have done some major accounting changes also, definitely for which SMA-0 is one of the conditions. We had some effect of the -- ballooning effect of the accounting system earlier where the accounting -- where actually the dues -- overdues were getting ballooned at the end of the EMI schedule, but now we are actually brought it forward. So that has resulted in some ballooning effect, so which is the reason of the increasing credit costs. But it will -- gradually, it is coming down and it will gradually come down. This is the first thing. Second thing is that gross slippages of EEB from the EEB segment. So these are yet to get arrested. So till quarter 2, what was our expectation, it has not happened for definite reasons across the industry. And so that slippages are now showing some good trend as what Rajeev has recently just said for the day that the SMA-2 figures almost decreased by INR 100 crores on a month -- quarter-to-quarter basis. And the trend is on the similar line. So we expect the substantial slippages can be arrested. So with the slippages get arrested, definitely, the provision requirement will come down and the credit cost will improve. This is first thing. So we are still maintaining our guidance that after 2, 3 years, we will be putting at around 2.5 years.

Yes. Just further supplement and clarify on the first point, what we have said is by FY '27 exit is where we are expecting a credit cost of 2.5% to 3% for EEB on a stable state basis. On an overall bank basis, we'll be looking at a credit cost of 1.5% to 1.6%. And that is because we are improving our secured mix as we've already seen. We will continue to endeavor towards that. And also, we expect that the recovery in the EEB environment comes through over the next 6 to 7 quarters.

So second part, your SMA-0, as you've already said that if holidays are there, we can't help because demands are generated, but people are not there in the field for collections. So -- but Rajeev has already given a trend that almost 85% of the amount of SMA-0 in the EEB segment has already been recovered during the first month of this -- whenever it is due. We expect that this will also come down, but it will definitely depend on the holiday period. As regarding your PPOP margin, so the effect of the reduced cost of funds, that will come into our balance sheet almost on a large basis is a partial will come in Q3, but majority will come in Q4 and Q1 of next quarter, we will see a substantial impact of this cost of reduction of our interest rates, the moderation of interest rates. And definitely, that will also improve our margin. Further, we are also taking steps to increase our other income. So recently, we have also revised some of our service charges, and we are taking much -- many more steps to increase our other income. The treasury operations, which has given us a huge profit in the Q1, obviously, because of the increasing rates, it has not happened during this quarter. So we are also looking if we can gain some -- make some treasury gains. So these are the steps we are taking to improve our PPOP margin. And the fourth one is regarding Bihar elections. So we find that during election manifestos, many political parties do come with debt waiver. But we have also seen that most political parties have realized that this is not a permanent solution. And even the states do not have the capacity actually to fulfill this commitment. So we'll look into it, but I don't see a major problem because Bihar has been one of the good states compared to many other MFIs, at least for Bandhan Bank, the recovery has been quite good.

Yes, and I think just to supplement the PPOP margin because the full brunt of the repo rate impact came through in this quarter on the advances book, whilst we have taken actions to reduce the savings account rates, which has immediately given some benefits, the reduction in the term deposit rates will take a bit of time depending on when the deposits come for renewal. And that's what we said from Q4, we should start to see. So effectively, this net interest margin will be sort of the lower point. And from this coming quarter onwards, we should start to see some improvement in the net interest margins.

How much did you cut your MCLR by, say, since April?

So 200...

Roughly 200 basis points.

But has anyone cut MCLR so sharply or you are higher than peers?

No, we have just moderated the calculation. So earlier, what was the basis of the parameters of doing MCLR because we took this opportunity. It was -- we are one of the outliers. So we had an MCLR of almost 11.5% compared to the next one in the line, in the queue with around 9.5% or 9.7%. So we did a recalculation and we thought that it should be prudent enough that we make the correction at one time because it may be a requirement going forward. So that has impacted almost INR 5,000 crores of our housing loans.

Okay. But as in it changed the way you calculate what in MCLR, like cost of funds is a given?

Yes, yes. So definitely, so some of the service charges, which we are actually recovering from the customers. So that was the basis for that year. So that was -- since we are recovering it, we have not taken it as the cost of funds.

I think some of the elements which are broadly aligned with the way the market actually computes it, so we aligned it to the market.

[Operator Instructions] The next question comes from the line of Abhishek Murarka from HSBC Bank.

So I have a follow-up question on the microfinance business. So in Bihar, has the MFIN stepped in or have you or some of the large lenders have you all made some of the representations or at least issued some guidelines so that your field agents, et cetera, can work without any hindrance or if customers tell them that it's going to be waived, they have some official document to show saying that right now, you have to service your loans. So just the reaction from the industry and the support that you might be getting or might not be getting from the government if you can comment on that? So that's question one. I'll come back on question 2 actually.

So Bihar, again, I'm telling you that if you look at our portfolio, the delinquency trend is a very acceptable level, I can say for that. So almost 30% against -- 30% if you look at the delinquency trend for the day. Industry trend is 5.14 against which our trend is 3.8. So if you look at the 90-plus delinquency trend, the industry trend is 3.0, ours is 2.04. If you look at 180-plus delinquency trend, 12.54 is the industry trend and ours is 6.84. So we are a little bit comfortably placed than what the industry is doing for the day. And this election manifestos, each time, whenever it happens in any state, one of the -- I think, many of the political parties do come up. But till now at least no major political party, we are not seeing that they've come with these manifestos. But Vishal, if you want to add any.

This is Vishal here. In terms of the Bihar, we are watching it very closely in terms of the impact in the last 1 month or so. In our portfolio as such, we have seen regular collections has been the way it's been happening in the previous quarter, though we have taken the cognizance in terms of the noise which is going around in the political environment out there because that's one of the things is always getting highlighted whenever a state election is happening. We are closely tracking. It's been performing as expectation, and in fact, in the same manner it was performing in the previous quarter as well. So I don't think as of now, we see a challenge but we are cognizant of being -- keeping a very close eye in terms of how things are progressing there.

So sir, some preemptive steps have still not been taken or you've not felt the need to take...

No, no, preemptive steps have been already taken.

That's what I was [ thinking of ] actually. I understand your portfolio is good.

We're also guiding with MFIN body and the directives from there given to all the relationship officers to carry it along and to explain that these wavier talk and all is all not sustainable and not rightful and that is given to all of the ROs, which are the relationship officers who travel and make the customer -- in their weekly meetings, they will meet customer, very much understand, whoever comes up with that query. We haven't seen thus far so much of customer noise saying that please waive our loan amount or we would not like to pay because there is people who are saying we won't pay on behalf of us. Those things have really not come up. There have been very small 1 or 2 group meetings in which it had come up, and we've explained. So we haven't seen much of a number difference of collection.

In fact, much better than the industry.

So whatever -- so even the MFIN has given us one pager to inform all our customers in terms of -- during the election time and not only specific to Bihar. Whenever state elections are there, MFIN with common data and with common guideline given to all of us in terms of how do we explain to the customers who are raising this point of political interferences and waiver for the loan.

Understood. Okay. The second question is, I see your disbursements in EEB have gone up. And obviously, in a couple of states, there is still an increase in SMA-1, 2, et cetera. And you're also -- you've also said in your opening remarks that stress may continue in EEB for 1 or 2 quarters. So which geography have you been comfortable in lending that is what I wanted to understand. Where has this disbursement happened?

Abhishek, just to clarify, what MD sir mentioned was, stress to probably continue for 1 or 2 more months and thereafter we should start to see a recovery, just to clarify that.

Sure. Okay. But the question still stands. So where have you found comfort in increasing your disbursements and lending more?

So definitely, I can say the Eastern part is doing reasonably well, so West Bengal, Assam, Bihar, all these states. In other parts also, we have seen delinquencies are improving. The collection efficiency has improved.

See rightfully, MD sir spoke about West Bengal, Bihar, Assam continues to be our strength areas, and that is where we have seen growth also coming in. We have a large existing base. So there is a renewal every 12 months or 18 months. So that is where we really -- for the good customers of ours, we really focus upon and try to get that renewed. So West Bengal, Assam and Bihar in that order keeps on doing well. We've also seen some traction happening now in parts of Orissa and Madhya Pradesh, though not in that scale of what Eastern India is going around. The places where we are really not able to grow because of guardrails are Tamil Nadu and Karnataka because of the late entrance of ours. Otherwise, we see decent renewals coming in, and you would have seen by the numbers, disbursal of EEB in last quarter, quarter 2 vis-à-vis quarter 1 has been almost back to the levels of FY '25 quarter 2 level. It's almost there. So that's one confident statement, which we get in where we see that the disbursals are picking up because this business runs both ways, disbursals and collections goes hand in hand.

So this quarter, I think we have made more than INR 5,000 crores, disbursals.

September month, we crossed INR 5,000 crores of disbursals in the month of September.

Our next question comes from the line of Aravind Ravichandran from Sundaram Alternates.

I just wanted to understand like in housing category also, NPA percentage moved up sequentially...

I think, can you speak a little clear, sorry, Aravind, your line is not very clear.

Yes. Sorry. Can you hear me now? Is it better now?

No, no, not better. There's this some I think associated echo is coming.

Hello, is it better now, sorry?

Yes, I think.

Yes, yes, sorry, sorry. I was trying to understand that in housing category also like sequentially, NPA has moved up, NPA percentage, is it again because of the holidays or is there something else in the play here, because growth is also a very strong in housing category despite the NPA percentage moved up sequentially, I would like to understand what is the...

Yes. So I think if I could understand, sorry, the audio was still in and out, what your question is around the housing NPA and the SMA, right, as to what is exactly driving that?

Yes, housing NPA sequentially moved up despite being higher growth, like having higher growth, just would like to understand what is happening there.

So I think like MD sir I had mentioned earlier, there had been some sort of ballooning related sort of NPA recognition which had happened some time back. And we do an assessment of that on a quarterly basis, so which affects some bit of housing. However, even if the SMA book has slightly gone up and we've seen that the credit cost and the final recoveries that come through are commensurate. And therefore, the net credit cost that comes through is aligned to the industry standards. The little bit of an increase that we see coming through the housing pertains to some of the underlying portfolio in the affordable segment. But the bank is taking efforts to make sure that the recovery comes through within that. So we are not seeing any kind of a material trend per se, which is causing a significant risk. But there are basically certain areas in certain sectors of sections within the housing where we're seeing the risk emanating a little bit more, but the bank is taking actions to make sure that the collection efforts increase on that particular front. But overall, on a net basis, even after the recovery, if you look at the credit cost, it's actually quite commensurate with what we see in the industry.

So slippages has gone to 2.4 percentage, so that is in the housing loan segment. But at the same time, recovery is around 15%. So the NPA through the total advances stands at 2.8% during the quarter. Slippages was 2.3%, not 2.4%.

Okay. And just one more question. Within the EEB portfolio, like Bandhan Plus more than 3 lenders, it has been actually stable for the past few quarters. Is it -- what is happening there? Like are you finding it difficult to run down that portfolio, what is happening there?

So see, we've put the guardrails on April 2 for FY '26. That means it's been 6 months since the time the guardrail has been put into effect for 3 lenders norm. I think we'll have to wait for 2 more quarters and gradually, it will speed up because as of now you have to compare in the first 2 quarters, the 3 lenders plus has gone down by 50 bps or 100 bps, 1% it has come down, from 11% to 9.5%, right? So this 9.5% now will go at a speeder pace from quarter 3, quarter 4 onwards. So from March -- because our loans also run for 12, 18, 24 months, so from March '26, you will see this number of 9.5% going down to a 7, 6 percentage is what when we checked out, it will become that way and below 5% maybe quarter 1 FY '26 -- '27.

Yes, actually, they are typically taken at this stage of renewal.

Yes. So what we are seeing, obviously, 100 bps has come down already in the last 2 quarters. And you'll see the traction really picking up now because whatever has been booked for last 18 months, it will start maturing now in 12 months and so on and so forth. So the numbers will [indiscernible] which will speeding up compared to what it has been happening. The numbers will keep on going down from there.

Understood, sir. Understood. Just one last question.

I'm so sorry sir, Aravind, sir, I'm sorry to interrupt, but please rejoin the queue for more questions. [Operator Instructions] Our next question comes from the line of Anish Rai from UBS.

So I had a question around your net new EEB customer accretion. So that has been hovering at the same level for quite a while now, I think, for last 2, 3 years now. So just wanted to check, do you still believe there's an increasing penetration story there? Or I think -- we think the market there has sort of saturated and now it's all going to market share gains? Because so -- and the related question is, so when you think about growth for the microfinance industry or for the bank, where do you see that growth coming from? Because I think anyway leverage and all would be quite conservative from here on. So how do you see that growth without that increase in customer accretion? So that is my question.

Sorry, Anish your question, just to understand, is the increase in customers or increase in advances?

No, net EEB customers, active customers, you disclosed net EEB active customer number, right?

Got it. Got it.

No, you're right that we have stagnated in terms of the new borrowers coming in month-on-month. But as we speak, even today, we keep on adding up 130,000, 140,000 customers. On an average in a quarter, we add up 3.5 lakh, 4 lakh customers. What we also have realized when we go for new customers, there are a lot of rejects which have increased in the industry due to delinquency and that's why we are also not able to really work upon in terms of getting the new borrowers because they have been rejected on account of their performance outside Bandhan Bank as well. And that's the industry trend. The good news is that on the renewal side, we have been working very closely with analytics to ensure that the good customers of us, which have been with us for a longer time, are all getting renewed and are all getting rolled for the new loans as well. So this traction, we will keep on seeing for the next 1 or 2 quarters. And once the industry stabilizes and the leverage issue is completely lift off, we will try and get further new customers. Currently, if you see and go by the industry number, around about 23%, 24% of the overall industry customers are ineligible to take loans going by the bank. I hope I'm able to answer your query.

Our next question comes from the line of Param Subramanian from Investec.

Firstly, on funding cost. So quarter-on-quarter, your cost of funds is -- there is not much movement, why is that the case? Because your CASA ratio is up. We have taken substantial cuts in our savings rate as well. So why is cost of funds not yet showing improvement? And related to that, how to think about NIMs going into second half and next year? Because I think at the beginning, we had -- of the cycle, we had called out that because of the mix shift, the bank would lose 70, 80 basis points of NIM. And it looks like we're already there. So how to think about NIMs from here on?

So the funding cost, what we have already explained that a moderation in the savings bank has come. So my funding cost of savings bank has -- almost by 200 basis points has come down. But the fixed deposits are yet to come. So we have got almost -- close to almost INR 70 plus thousand crores of retail term deposits and also fixed deposits, bulk deposits are also there. So there the moderation will take place as and when these get renewed. So it will take Q4 actually to...

So your CASA ratio is up, right, quarter-on-quarter, and there is a savings cost reduction.

Quarter on quarter, it is marginally up, yes, we have 28%. It has...

Yes, from 27.1% to 28%.

27% to 28%, we are marginally up. But the main thing is that because of the fixed deposits, which were carrying a very high rate of interest, so that needs to get moderated and that will get moderated only at the time of renewal or which we need to wait till quarter 4. A little bit impact will come in Q3, but not much. So Q4, actually the major impact will come.

Just to share some numbers, for instance, for our savings account, the cost has come down from an average of 5.52% last year, even in March '25 5.5% to almost 4.2% for this quarter. And in fact, September month was almost down to 4%. So we have done substantial reduction in savings cost, which will continue to give us benefit going forward as well. The term deposit rate reduction that we have done will take some time to effect because of the renewal date of the TDs coming in largely in Q4. Some will come in Q3, mostly in Q4, some will come in the first half of next year.

And the second question regarding the NIM, so we have already indicated that as we are moving towards more secured books, NIM would get impacted. It has got further impacted because of the upfronting of the repo cut, which we are not expecting. But again, the moderation definitely will continue. So -- but our guidance is that we should have it around 6%. So we are working towards it. It is not that EEB will not grow. So whatever the degrowth in the EEB has taken place, I think it will be arrested. And from Q3 onwards, we will be witnessing the growth. So that will definitely help us in actually achieving our NIM target. So currently, we are around 6.1% if we look at the half year. So already another 10 basis point moderation we have already taken into account. And thirdly, with the EEB segment going up, we will be able to achieve it.

Yes. And I think just to supplement, the NIMs for the quarter were 5.8%, and what we expect as the renewals for the TDs come through, the margin should improve from these levels. So we actually expect an upward trajectory from here. And this could be sort of the bottom point, at least during this financial year.

Okay. So from here on, it improves. And even from a mix perspective, right? So our strategy, we had initially highlighted that we want secured in the loan mix of about 55%. I think we are broadly there. Even microfinance, I mean, including the individual loan is 36%, 37%. We seem to be already there, right? So how to think about mix going forward for the next -- going into FY '27? Is microfinance going to grow from here? And has it bottomed out in the mix?

So that is our strategy. So if we grow in microfinance, our growth in the non-microfinance will be much more -- at a much higher rate. So this ratio will be maintained or a little bit, it will dip down.

Yes. So I think the secured mix could actually increase further by another, say, 2, 3 percentage points through the next 7 -- 6 to 7 quarters. But the degrowth in the EEB book is what we're trying to arrest so that we can at least start having a moderate bit of growth. That is why we are trying to get the mix.

Okay. So 55% can move towards something like 52-odd broadly, right? Is what you're saying 2, 3 percentage points? Oh, sorry, sorry...

No, no, what we're saying is 55% to go down further to say 55 -- yes, 57%, 58% over the next 7 quarters. But during that particular period, we will also try and get the growth back into EEB, so the ratio could move between...

Okay. Fair enough. And any briefings in our...

I'm really sorry to interrupt you Mr. Subramanian, you can rejoin the queue for the next question. Our next question comes from the line of Anand Dama from Emkay Global Financial Services Ltd.

Sir, this MCLR cut that we have done 200 basis point. Is that something to do with RBI telling us? Or is it basically we've done it voluntarily?

Let me make it very clear that it is -- it has got nothing to do with RBI.

Okay. And is there anything -- so basically, I'm sure that this year's RBI supervision would be largely over. Any adverse comments that basically came through in the RBI report?

I think that -- we cannot pinpoint at that. All banks do have report so -- but I would say that the major regulatory issues which were there, those have been already -- I think have been addressed. And where technology dependence is there, these are on the process of getting addressed. So that much I can say. So the major regulatory issues what were there, we have already addressed those things. But definitely, whenever you are in any banking operation, there will be some observations from the regulator, we will address as and when required.

Just confirming basically, we will not have any further shocks in terms of any PSL declassification or anything that would come from RBI?

No, nothing as such we have received in the supervisory.

Sure. Sir, secondly, on Bihar, I think it's the opposition manifesto, which has talked about some kind of waivers and so on. The ruling party hasn't. But is there any difficulty in terms of approaching the customer in terms of collections now given that the elections are around or we are able to reach to the customer, conduct center meetings and so on?

I answered this question before. I'll just quickly repeat in one sentence. As of now, we are cognizant of the issue, which is raised by the opposition. However, we haven't seen any material change in our collections as per today as well till date, but we are keeping a close watch. And it's been a part of the business of us now. Whenever there is a state election, these things have been spoken about and slowly it settles down and stabilize. So we haven't seen any disruption as of now. So customers visits are happening, group center meetings are happening in a normal way.

Our next question comes from the line of Hardik Shah from ICICI Securities.

Sir, if you can quantify the MFI slippages in this quarter.

Just a minute.

Sure. Just give us a moment.

And sir, any qualitative reason why the situation did not pan out the way it should have been because other banks -- all banks which have MFI segment, they have seen 20%, 30%, 40% decline in slippages. So what -- is this a geographical thing which is a bit of an adverse thing for us? Or why is it that the slippages seems to be elevated or not improved significantly versus others?

So maybe I'll answer both. So firstly, on the number, the slippages for the EEB, which is group loans as well both was INR 1,118 crores. These were the gross slippage. And the net slippage was INR 984 crores. The gross slippage increased marginally from INR 1,089 crores to INR 1,118 crores during the quarter. On your second question, I think, look, from our perspective, the bank had already been following the guardrails to a large extent, right? If you look at it, for us, the Bandhan Plus 2 portfolio was almost close to 90% and the overleveraging portfolio portion of the EEB was only around 10%. So that also has improved further down to 9.5%. However, the industry number used to be much larger. And what we see from the bureau report, the industry almost a year back was 19%. And over the period, they have tried to come down. So you will probably see the reduction more in the industry because they are coming from a position of a much higher delinquencies to lower delinquencies. From our standpoint, our delinquency levels were lower, and we have been doing better than the industry. However, at the same time, we are trying to put in efforts to make sure that our collection and recovery efforts to go up and also that we have lower slippages come through, which is what we are expecting sometime in Q3 onwards for the recoveries to come through.

Quickly, I'll just supplement in terms of what we spoke about the industry. I'll give you the figures, which is reported by the bureau end of September. 180 plus delinquency which is typically at an industry level is at 15.26%, we are at 7% at a 180 level. At a 90 to 180, industry is at 3.27%, we're at 2.08%. So comparatively, both 90-plus and 180-plus, we are far, far superior compared to the industry. So even if they have said slippages have reduced, maybe for this quarter, they have already been at a very high end of 180 and 90 already in the previous quarter. Current quarter, standing point, if I see in the month of September, a large difference between both 90 plus and 180 plus. So I'm not sure about where are we getting the figures of slippages of the industry overall improving by 20 basis points.

This is from other banks, so they have a very small amount of this EEB book. So there maybe -- they must percentage-wise have shown a better improvement compared to us because we have a large base. So on this large base, the percentage improvement is difficult to project.

Okay. Sure. And secondly, sir, this INR 650 crores of SMA-0, which was because of bunched-up holidays, that you have managed to recover INR 350 crores of them. Ideally, it should have been even much more, right? I mean, is that the understanding? Or this INR 650 crores of bunched-up holiday -- of course, the holiday season is over and then 2x for October should be a decent active month. You have only managed to recover INR 350 crores. Is that what -- I mean, this is what you said, right, that you have managed to recover INR 350 crores. So you have managed to regularize INR 350 crores out of INR 650 crores bunched up, right?

See, let me explain this holiday demand to -- for your understanding. What happened was because we have got a predominantly 53% of our portfolio in EEB and September 29 and 30 are holidays, there is an impact of holiday demand, in which we collected 92% of our customers. 92% of the customers on the days of 29th and 30th, we were able to collect. 8% of the customers, which one because we have weekly installments, we were not able to collect. And the following week, we are able to collect 95% of the 8% of the customers. But what happens is because of that 8% of the customers, that totals up to close to INR 600-odd crores of the principal outstanding, which moves to 1 DPD -- 1 to 7 DPD or 7 to 15 DPD, if there are 2 Monday holidays. Like in this month of October, there have been 3 holidays on Monday, which is -- as being a Monday weekly installment, plus we have to take advance, we take 92%, 93%, 7%, 8% are flown to the next weekly cycle and which we collect again in the next weekly cycle. So whatever flows like this INR 550 crores, which happened earlier as well in the month of March 31 and specifically on the last day of the month, we are able to collect 92%, 93% in advance, 7%, 8% in the following week. And that is a proof of a testament that when you see SMA 1 and 2, there is no increment there even from April to September, October, but SMA-0 gets elevated temporarily for a week primarily and slowly, slowly, it keeps on coming down week by week. So as I speak, this 1,500 number, which is reported here as an SMA-0 is the 1,200-odd number 3, 4 days back. So this number will slowly come down to below 1,000 number, which was there in quarter 2 and so on and so forth in the next 1 month because there are no more holidays in November and December and nothing coming at the end of the month. The last day of the holiday month -- of a holiday in the last day of the month becomes a bigger problem because we don't have time to collect for that particular. And September 29 and 30, October 1st and 2nd were holidays. So there were continuous holidays at least for that period. But like what Rajeev explained, bulk of it has already got collected in October. And whatever is still there 1 week pending will further get collected in November. So I don't see a risk in SMA-0 formation. The risk is very temporary for 2 to 3 weeks and then it stabilizes. This particular month because of 3 Monday holidays, it is taking maybe 1 week or 2 weeks more. From November, I feel that par 1 to 30 will stabilize back to the normal number of June numbers -- June quarter. I hope I made everybody clear. It's a temporary blip because of the last day being a holiday in a month.

And sir, just last thing on your notes, you have -- I mean, in the PPT, you mentioned that GNP has come from...

We can't hear you.

Sorry, Hardik, your audio is not very clear.

Yes, sir. Sir, is this better now?

Your voice is cracking.

Sure, sir. Sir, I wanted to check...

I think still some audio issue is there.

Okay. Sir, I just wanted to check this wholesale banking, ABG book and erstwhile SEL book, what is the reason for the rise in GNPA there?

If you're talking about the erstwhile SEL, which is ABG book, the increase in NPA. Is that the question? Yes, sir, hello?

What is the reason? I mean...

SEL increase in NPA.

See this SEL erstwhile book, the denominator impact is there. We have gone a little slow in terms of the growth in SEL, and we are planning to change our policies and making it far more robust. For that reason, there has been an impact of denominator growth in SEL. Otherwise, the slippage pattern of ABG has been on the similar numbers month-on-month, the way it was there also in the previous quarters or so. But because of the denominator coming down and the growth, we are trying to make it in a more robust manner, that is why you will see that impact of the NPAs elevated and the percentage is going higher. But in terms of the number as per se as such, it's pretty much in the same trend.

Sir, I was referring to absolute number only. INR 730 crores of GNPA has become INR 870 crores on a quarter-to-quarter basis on wholesale banking.

Which one?

And GNPA in wholesale banking, INR 730 crores has become INR 870 crores.

Yes, the wholesale banking book includes the ABG portfolio. I think if you look at the wholesale banking NPA levels, excluding the ABG, it is quite low, almost like 0.5% or 0.6%, 0.8%. But ABG is what has a slightly higher NPA primarily because the book actually has been degrowing and the denominator effect, like Vishal mentioned, is affecting the NPA percentage. But there are certain underlying risks, which the team is actually looking at in terms of improving the collections. It has been an unsecured portfolio, which actually has had some bit of an NPA level, but the team is focused in terms of making sure that the collections come through within that.

Okay. So this is unsecured business banking, right? I mean what we see at other banks business banking...

That is correct.

And this is not a LAP, right? Is the business banking unsecured working capital...

No, no. This is not a LAP.

Not a LAP, not a LAP.

It is unsecured.

Our next question comes from the line of Vatsal Parag Shah from Knightstone Capital Management.

So my question is regarding MFI. So we are seeing that Madhya Pradesh and Bihar and Maharashtra also has some difficulty in collections from some other players. So are you seeing any stress there?

So like I said, Bihar is doing reasonably well for us. For us, like I said, Tamil Nadu, Karnataka is a little stressed. Maharashtra is doing reasonably okay for us as far as we are concerned, though I see there is an industry difference from our portfolio compared to the industry portfolio. The industry doesn't do that well. For us, Gujarat is a little -- compared to the industry, a little cause of concern, but not that much to worry because our portfolio in Gujarat and Southern states are much lower, if I have to compare. And so we are keeping ourselves abreast in terms of -- and watching the Gujarat portfolio more qualitatively. Maharashtra is still holding for us the way it was earlier.

I hope the question was answered. Yes, Vatsal, could you hear that, the answer?

Give me one minute, sir.

Vatsal, please go ahead.

Yes. So my next question was more forward-looking in nature. So for H2, we were banking on the growth being higher in MFI and the asset quality improving. But next year in Q4, West Bengal and Assam both will have their election. So just wanted to understand, historically, in the past 2, 3 election cycles for West Bengal and Assam, what has been the trend in disbursement in asset quality? Like do they significantly deteriorate or we can bank on H2 being significantly better than H1 despite the election months being there?

In fact, 5 years back when the election took place, the portfolio quality was much better. There were no issues at all. In West Bengal, there is -- yes, I think no election, no political company -- political party leads campaign that loan waiver, [ get merger ]. I don't think that's going to happen in any way. But Assam also, there was post-election, this has come up earlier. But I don't think in Bengal specifically, anything of this is being even spoken at this point of time. But like I said, this business is such that there are political impediments, and we are aware of how to manage it even now because we have been doing it for a long time across the industry. And this business is also -- microfinance has been -- half 2 is far superior than half 1 in terms of both disbursement growth and stability in terms of quality of the book as well. So we are optimistic that quarter 3, quarter 4 will have better trends in terms of both growth as well as in quality of the asset book.

And also, I think because of the various guardrails and the communication, the borrowers are also well aware now of the need for a discipline in terms of repayments.

Absolutely.

Okay. Got it. And lastly, have you taken any price hikes in group loan?

No, no, no. We have not increased any price.

Our next question comes from the line of Aravind Ravichandran from Sundaram Alternates.

Yes, yes. So sorry, again I have this question but because we have seen different players because of the risk-based pricing in MFI, maybe inched up the yields like 75 basis points, 100 basis points, different lenders have done different things. But based on the past several quarters, they had to -- they felt like there is a need to raise the yields. Don't you see any need like that in pricing yields for JLG loans, MFI loans? That is my first question.

We are not looking at moving any risk-based pricing because the group concept is cohesive. So it's difficult to implement risk-based pricing in a group in many ways. We want to continue the way it is in terms of ensuring that we get the right quality book rather than looking at a risk-based pricing because the group concept is very cohesive and it has formed a group. And it is very difficult to implement on the ground that we have different risk-based pricing and explain in a particular group. And so we have been keeping the way in terms of keeping a flat rate at a group level. And we haven't increased the prices or yields in the recent past.

Yes. I think there is no plan to hike the rates in the MFI.

Rural market basically is a very sensitive market because one customer is getting a particular rate and another is getting another rate, then there is basically a disconnect. So most of them they want a similar rate, they have taken a loan of INR 50,000, in the fixed installment I am paying so much amount to the...

So if you look at the risk profile of this customer, the risk profile is also the same. It is very similar, excepting that some are paying on time and some are paying with some delay or some are not paying for the day. But if you look at the risk profile for anything, whether on the basis of income or whether the basis of the schemes, the unstructured information, the risk profile almost is very similar in respect of this particular segment of customers.

Just one more question on the branch addition. Branch addition has been, I think, like lesser than our desire, I guess, in terms of bringing back growth for the subsequent quarters, let's say, even '27 or '28 also. How are we looking at it now with...

I can't understand actually.

Yes, we are unable to understand the question.

Sorry. I was trying to understand like branch addition has been particularly slow in the last few quarters, yes. So if we want to get back the growth in the subsequent years, is this enough? Are we going to significantly accelerate the branch expansion rather investments? I understand that you mentioned that we need to make investments.

Yes. So we have already a plan for branch expansion during the next 1 year. So we are just going ahead with that plan only, but there is -- our motto is not that we would go very aggressively in branch expansion, rather we are focusing on the digital strength capability of the bank. But definitely in geographies where our presence is very less, so we are focusing now on the South. We are also focusing a little bit on the North, but definitely much lesser focus on the East.

Our next question comes from the line of Mahrukh Adajania from Nuvama.

Thank you for giving me one more chance at asking question. I just had one clarification that the ECL will be implemented now. So what would be your overall SMA pool because that will determine the Stage 2 provisions, right, in terms of even other loans. Obviously, you've been transparent enough and you are disclosing the EEB pool regularly, which is very helpful. But what is the total SMA pool, including non-EEB, like, say, for 0, 1 and 2?

Yes. So Mahrukh, we have sort of looked at the new regulation...

You want as of September 30 or what?

Sorry?

No, you want the figures as of September 30 or you...

Yes, yes. No, September 30, the total SMA.

No, are you asking for the SMA as per the current books or SMA as per the Ind AS new guidelines?

You can give either? I mean, you can give both.

No, no. So look, we are assessing and evaluating. I think the draft guidelines have come through. We are looking at what exactly it would mean for the bank. I think at this stage, that process is still on. So currently, I think whatever we have in terms of the DPD books in terms of SMA 1, 2, et cetera, we have already included in the investor deck for EEB. So I think you will be able to see the details there. But the assessment for the new guidelines of ECL is still under process. So we will not be able to have the details of that.

Sure. But in IndGAP, would you be able to share the total SMA pool under IndGAP, including non-EEB?

Sorry, Mahrukh, we will not have the figures for Ind AS right now, not for ECL as per the new guidelines.

IndGAP also, you won't have?

Yes, we can share it later. You can make...

Yes, yes, we'll re-connect to this.

In the interest of the time, that was the last question. I now hand the conference over to the management for the closing comments.

So thank you, everyone, for joining for the investor call and for patiently listening to the various updates as well as for asking the various questions. And thank you for reposing the trust in the bank. Thank you so much.

Thank you, sir. On behalf of Bandhan Bank, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.