Bank of Baroda Limited (BANKBARODA) Earnings Call Transcript & Summary

Good evening, everyone and welcome to Bank of Baroda's analyst meet for our quarterly results for the quarter ended 30th June 2026. Thank you for joining us. We have with us today our Managing Director and CEO, Dr. Debadatta Chand. He is joined by the bank's Executive Director and CFO. We will start with brief introductions and a short presentation, followed by opening remarks by Dr. Chand and then we will have the Q&A session.

Thanks, Firoza, and good evening to all my analyst friends here. I'm just to introduce the management team. I'm D Chand, MD and CEO of Bank of Baroda. With me, we have Mr. Lalit Tyagi, he's the Executive Director, looking after corporate credit, international banking and treasury. With him, Mr. Sanjay Mudaliar, he's the Equity Director. He looks after the IT functions and more importantly, the retail asset of the bank. We have Mr. Lal Singh, he's Executive Director. He looks after HR function, recovery function and also the MSME vertical of the bank. And we have Madam Beena Vaheed, she's the Executive Director, looks after the control and insurance function and more importantly, the retail liability function of the bank. And we have the CFO, Mr. Sridhar, who have joined [indiscernible]. So with this, I request our CFO to make a presentation, and then I'll have my quick comments, and then we'll go for the question and answer. Over to you, Mr. Sridhar.

Thank you, MD sir. Good evening, everybody. It's my privilege to present before you the financial highlights of Bank of Baroda for the quarter ended 30 June 2026. As at the end of Q1 FY 2027, the bank's global business stood at INR 30.5 lakh crores, registering a Y-o-Y growth of 15.4%. Our global advances have grown by 17.4% Y-o-Y with the domestic advances growing at 16.1% and international at 23.3%. Within the advances book, the bank has continued to focus on RAM advances. Our organic retail book grew by 18.4%, agriculture by 18.7% and organic MSME by 20.3%. Corporate loans have grown by 15.3% Y-o-Y. Within the Retail segment, we have seen smart growth across the portfolio with education on at 10.8%, home loan by 14.7%, auto loan by 25.3% and mortgage loan by 7.4% Y-o-Y. Regarding deposit growth, our total deposits have grown by 13.8%, with international deposits growing by 8.9% and domestic by 14.7%. The domestic asset deposits have grown by 10%, and term depots have registered a growth of 17.8% Y-o-Y. As of 30 June 2026, the bank's domestic credit deposit ratio stands at 83.31%, the CASA ratio stands at 37.72%. With regard to our quarterly profitability metrics, our operating profit for the quarter stands at INR 8,127 crores. As you are aware, the bank entered into an out-of-court settlement to resolve a legacy litigation issue of NMC Group. The liability of the bank in these proceedings is limited to the sum of USD 600 million, which was paid on 1 July 2026. The settlement amount has been divided to the Profit and Loss statement for the quarter ended 30th June 2026. Therefore, our net profit for Q1 FY 2027 after observing the impact of the settlement stands at INR 1,278 crores. Without the impact of this exceptional item, net profit for the quarter would have been INR 5,548 crores. Return on assets stands at 25 bps, excluding the impact of the exceptional item, ROA would have been 1.10%. Internal equity similarly stands at 3.89% for the quarter. If you -- if we don't include the impact of this exceptional item, return on equity would have been 16.37%. With regard to key ratios, our yield on advances stands at 7.37% for the quarter. Bank's cost of deposits for the quarter stands at 4.66%, reduced by 12 bps on Q-on-Q basis. Our net interest margin stands at 2.77% for the quarter. Now we come to the asset quality, which continues to remain robust. Our GNP ratio has improved by 29 bps Y-o-Y and stands at 1.99%. Net NPA ratio is below 1% at 50 bps, an improvement of 10 bps Y-o-Y. Our provision coverage ratio, including TWA is comfortable at 93.28%. Our slippage ratio for Q1 FY 2027 has reduced by 25 bps Y-o-Y and stands at 91 bps. Credit cards for Q1 FY 2027 stands at 29 bps as against 55 bps in Q1 FY 2026. Coming to our SMA and collection efficiency. Our CRILC SMA 1 and 2 as a percentage of our standard advances reduced to 7 bps as of June '26, as against 40 bps for June 2025. Our collection efficiency, excluding agriculture, remains robust at [ 19.2% ]. In terms of capital adequacy, our required capital position continues to be strong with the CET1 at 13.9%, Tier 1 at 14.1% and CRAR at 16.30%. Our quarterly average LCR remains healthy at approximately 127%. Thank you. Over to you, MD sir.

Thank you, Mr. Sridhar. Again, friends, Mr. Sridhar has said about all the financial numbers. So you know better in terms of numbers, so only I'll make a couple of comments here. That the bank growth engines are all intact, growing strongly kicking and rolling also. The numbers would have seen that the June quarter numbers have been better than the full year of March. And March 2026 for the full year, we had a very strong number. Credit growth in March was 16.2% and June now 17.4%. The deposit growth in March was -- full year was 12% and now it is 13.8%, and the domestic is almost above 14%. So in terms of the growth engine, the bank's ability to grow, I mean, significantly the capacity is all performing well, rather doing better than the system I would believe. [indiscernible], asset quality, it's -- the benign asset quality continuing. The CRILC data, the slippage ratio, you would have seen, the collection efficiencies now all time high at above 99%. I think the asset quality the journey continues. Marginal in terms of Y-o-Y, the GNP and net NPA, it has significantly gone down, but sequentially, you would have seen a marginal uptick that precisely because of the lower denominator, point one; and secondly, a conservative write-off that we have followed in this quarter as compared to the same quarter last year. The write-off last year June quarter was almost INR 2,200 crores. Here, it is INR 625 crores. So in that way, the banks -- the business growth, asset quality continued to be strong, robust, and that's something is also getting reflected in our profitability, more particularly on the NII growth and also on the operating profit. I will come to net profit later. In terms of guidance, the credit growth, we continue to have the same guidance of 12% to 14%, although we are [indiscernible], but then geopolitical is something that [indiscernible] us to be slightly [indiscernible] at this point of time. The deposit growth, we again put it at 10% to 12%, same as [indiscernible] articulated. The credit deposit ratio is to operate between 84 to 86, as you carry a significant [indiscernible]. The NIM this quarter has been 2.77%, but earlier guidance was 2.75% to 2.95%. We continue to hold the same NIM guidance. The credit cost this quarter has been 0.29%. It is less than the 0.6% guidance we had given earlier. The slippage also at 0.91% better than the Q1 of last year. And on the guidance is 1% to 1.25%, we continue to hold that. ROA for the last 17, 18 quarters, we have been doing ROA in excess of 1. This quarter, because of the full impact of the settlement has been taken in June quarter, the ROA is 0.25%. But suppose you exclude that exceptional item, it is 1.10%. Our ROA guidance will hold and watch now. Possibly, the full year guidance, we'll give it up after we migrate to the next quarter. But at least Q2, Q3 and Q4, we expect the ROA to be more than 1%. Full year basis, we'll give guidance later. ROE continue to be between 15% to 16%. Let me come to the NMC case. Because of the silent period, we didn't articulate the -- post our announcement to the exchange on 2nd of July. As you know, I mean, the CFO also talked about, we entered into an out-of-court settlement with a joint administrator and the payment of USD 600 million was made on 1st July and the exchange was notified on 2nd July. The settlement reserves all the claim. I repeat, the settlement resolves all the claim between the parties without any admission of liability or wrong doings. The bank liability in this proceeding -- in both the proceeding [indiscernible] and also the U.K. court is limited to USD 600 million. The terms of the agreement is confidential because the case is it subsidized vis-a-vis other defendant. The claim against the bank has already been discontinued in both the court. The financial impact has been fully absorbed in June. We have not touch the floating provision that's continued to be INR 2,500 crores there in the books. Typically, we are -- I mean, on the ECL migration, we have kept the provision for that. This brings closer to a very complex and long-standing cross-border dispute, which inherently complex in nature involving multiple jurisdictions, different legal systems and extended legal processes. Commercial settlement will establish global practice for achieving certainty and finality in such meters. The decision to settle the case was taken after careful assessment based on the legal advice and it is based on the commercial consideration involved, including time, cost and uncertainty of [indiscernible] litigation. It's a commercially prudent decision taken without any admission of liability or wrong doings. It allows us to close a legacy matter. I repeat it allows us to close a legacy matter and focus on our customer, stakeholder and long-term sustainable growth. You would have seen those numbers in the June quarter itself. The Bank of Baroda strong, well capitalized and financially resilient financial institution. The bank continued to hold the footing provision of INR 2,500 crores, which I said earlier. Our capital adequacy remains very strong rather in June, it has improved vis-a-vis March, stronger asset quality. And also, we have seen the growth momentum across all balance sheet parameters. We remain committed to high standards of governance, prudent risk management and a strong compliance framework across all our operations, both domestic and international. Thank you very much, and we are open to question-answers now.

[Operator Instructions] The first question is from Mr. Ashok Ajmera.

Sir, even if you take out this out-of-court settlement, this onetime USD 600 million hit, if you see the quarterly result of June quarter, sir, most of these parameters, sir, we are little bit faltered because if you see the credit growth, the deposit growth, the business growth, I think after many, many quarters, it is down than the previous quarter. I mean the settlement may not be a reason for that. Having said that, even that asset quality you are saying is robust. In this quarter, you see it both our gross NPA and net NPA has gone up in absolute terms as well as in the percentage terms because there is no growth, even the percentage terms also, it is higher. Now CRAR comfortable because you have not done the credit. So laterally, CRAR will be usage comparable. But sir, on the whole I mean we are a little bit disappointed. We have taken the hit. We have agreed, okay, so it may be a very good judgment assessment for -- from the management point of view. But otherwise, if you look at the quarter, because the provisions also reduced to see that the profit is at least there INR 1,278 crores. And secondly, even if you add this to the settlement, I think some part of settlement amount was anticipated and provided for also in the past. So even otherwise also the profit would have not been even equal to the last quarter. So on some of these things, sir, can you, I mean, clarify that why we have not only muted but a negative growth in this quarter on many of these fronts? And then going forward, when we say 12% to 14% this credit growth, how do we then will plan to achieve that? And in fact, even the ECL provision, yes, it cannot be touched because 2,500 floating is now basically earmarked for ECL provisioning. So on that front, what are our plans to take care of the remaining amount of the ECL because the assessment must have been over by now only. And so I mean, it's a very broad study. I mean just we got the result late today. But if you can add something to it because the treasury has added the -- even that INR 1,270 crores is also because of the treasury income going up to almost INR 900 crores as compared to only INR 43 crores in the last quarter. So operational wise, this quarter overall seems to be a little dismal, a little disappointing to me personally.

So I just tell you, I'm also slightly disappointed that I mean you have not read the numbers particularly. I'll just tell you why I'm saying so I'm disappointed. My credit growth for this quarter is 17.4%. My deposit growth is 13.8%, global and international is 14.5%. I mean domestic is 14.5%. These are possibly one of the strongest growth not only for the bank itself in all the quarters, but the strongest growth possible in the industry itself when I'm comparing with the large peers. So the asset quality, the CRLIC data, the SMA 1 and 2 more than INR 5 crores for the book as a whole, consisting of domestic and international. From 0.18, it has gone down to 0.07. The slippages have gone down. Treasury book of, I mean, almost INR 370,000 will have some treasury income and that treasury income is INR 893 crores, which is much less than the same quarter last year of INR 2,200 crores. So I think there is not a single parameter in the balance sheet on profitability other than the net profit, which has shown a decline trend or a lower growth or a lower profitability metrics. These are all very strong numbers. I would request -- honestly request you to please have a relook on the numbers because there are no count in any way, any of the number has given any negative vis-a-vis the last quarter. It is one of the strongest performance growth we have in all this quarter. In terms of profitability, look, we said earlier in one of the earlier conversion I was telling, we cannot make a provision on a settlement case for a specific provision or a litigation case. We buffer the balance sheet floating provision looking at the floating provision or buffer for the ECL impact. That's why the full impact of the settlement -- full impact has been given in this quarter. There is no earlier putting any provision which has helped in terms of negating the impact of the INR 5,680 crores that the impact on this quarter. On the ECL front, you said, right? The GMP and net NPA, if you compare June over June '25, there is a significant dip. Sequentially, it has gone up because of the denominator because the overall RWA has gone down because June is typically slightly lower than that of March. Secondly, if just look at one number therein, the write-off that we had in June 2025 was INR 2,200 crores. We have done a conservative write-off of INR 625 crores, and that's why I were looking at an absolute number of GNPA or NPA slightly high. And we're going for a similar write-off, the number would have been much, much lower. So I don't think any count -- slightly I'm disappointed rather in terms of my sincere request would be, please have a look, we'll be happy to further try to clarify all your doubts. The bank's financial strength position, balance sheet growth are one of the strongest as on June. Yes, this exceptional item impact has pulled down the net profit. But again, Q2, Q3, Q4, I'm expecting a ROA still above 1. Full year ROA guidance will adjust in the next quarter. But clearly, full year would be -- may not be exciting one, and we'll give guidance in the next quarter. I think the bank is doing well thankfully putting your confidence in the bank and analyzing the bank closely. I would happy to interact more with you just to clarify some of the doubts here.

Anyway, sir, I stand corrected, sir, because the results had come very late, and I couldn't have might have not have been fully understood the numbers as you are explaining. Sir, now when this...

I cannot hear you.

Is it over for everyone? Or you still have a claim on this? For any prospects of the...

On this case -- you were referring, NMC case?

Sir, the case is over for once and for all? Or...

Case as far as the legal in both the courts are all over but our claim against the principal individual would continue both in India and outside.

Okay. So there are chances of some recovery?

Yes, that's why I said, the principal individual in this case, that's as part of the agreement, we will continue both in India and outside.

Next question is from Rikin Shah.

I actually had 6 questions, but short ones. The first one is on the duration of the investment book, the question here is that the duration on the investment book has gone up both sharply Q-o-Q and Y-o-Y. Curious to understand the thought process in the context that the next potential reduction by the Central Bank could be a rate hike, not imminent, but eventually. So while the increasing duration, it's the coupons right now, but in the future, it can result in MTM losses. So just wanted to understand the thought process there. That's the first question.

Duration has gone up typically. You would have seen this quarter the peak yield was almost at [indiscernible]. Obviously, at a higher yield, the bank would like to have a bit of, what you can say, investment over there just to take upside of the yield movement. And precisely, that is the reason why the book also would have seen an increase. But the book has been spread out in 3 component AFS, HTM and also the [indiscernible]. So if you look at this component therein, and even it has now moved down to [ 675 or 680 ] kind of level. So you could have -- I mean, anticipate the upside on those investments, which we have made at a higher yield. At the same time, we are positioned in terms of all the 3 books in a manner where any impact of a rate hike consequent with the yield going up, the bank is, I mean, adequately protected in that comp. So it's a very prudent decision to add a bit of duration just to take advantage of the rate movement and which has come right for the bank in terms of the subsequent rate movement. But any rate upward movement, and we'll be absolutely providing in terms of how do you manage the duration there.

Got it. Understood, sir. Sir, the second question, happy to say that you have degrown your corporate loans by 7% and still the overall loan growth is strong. Could you talk a bit more about the competitive intensity in the corporate loan segment? And also, if you were able to shift some of the customers from the [ T-bill ] to MCLR rate in the quarter as you were mentioning last quarter?

You're right on the -- yes, the corporate loan growth has been very strong, but YTD there is -- I mean, that is the only component in the advanced book you would have seen there is a bit of degrowth. Otherwise, sequentially all the advanced book, whether it is agri, retail, MSME, that is quite positive, right? So rightly so, that is best strategy, wherein we wondered that in the corporate book itself, the non-MCLR link which can be any benchmark link. Considering the elevated cost structure on the deposit side, we are trying to move them upward in that way. And that precisely resulted into let go some of the very fine price assets. So you are right on that, the strategy is bang on that, I mean, taking advantage of the change in interest rate structure in the industry and moving a bit of non-MCLR book into -- be it an MCLR or near to MCLR book in that way, right?

Got it, sir. Sir, the third question is on commission exchange brokerage fee income. It is down almost 47% Y-o-Y, not looking Q-o-Q given the seasonality, but even Y-o-Y it's down. So what is dragging that down?

That's one element, actually, we need to optimize that. We need to focus more somewhere on our -- I mean, the pricing strategy on the commission exchange, we need to -- because somewhere sometimes we see on a higher growth on the advanced book than you led to a couple of, I mean, at a lower processing, lower yield. So these are all overall all-in yield concept, right? So in terms of overall yield that you got on those accounts. But you are right, this is one element we need to focus more in the coming quarters.

Got it. Sir, the next one is on the revaluation of investment gain of about INR 365 crores this quarter. Could you just provide some more color on that? What was...

That's typically because of the yield movement that happened because then -- when you compare the March over the June closing vis-a-vis March, the yields were lower, that was the reason why there is a bit of a write-back that is possible on that book.

Okay. Okay. And the second last question is, sir, you did mention that write-offs were lower in this quarter versus the last quarter last year. But you did mention it's conservative. I mean if the write-offs were higher, we would have seen even higher provisions in this quarter and the credit cost, right? So I do understand that the GNPA and NPA ratio going up because of lower write-offs but should one expect the write-offs to be higher in the coming quarter and consequently higher credit costs?

No. Look, the write-off book is a book which is fully provided, 100% provided, right? And then out of the [indiscernible] then you decide to vest on write-off -- technical write-off, not the actual write-down, don't get confused with that, depending upon, I mean, the ability to get recovery of this money within the timeframe. So this is all the banks would have seen this as an element in terms of finally impacting the GNPA and net NPA. So this quarter, we have done a conservative write-off. So write-off won't increase your provision, write-off rather would -- I mean your PCR it impacts in terms of lowering the PCR rather the other way. So we wanted to protect the provision coverage ratio, and that's why we've gone for a conservative write-off. The slightly marginally elevated the GNPA and net NPA on a sequential basis, although our GNPA, NPA in the system, if you compare, this is one of the good number to have. And that has seen a significant fall from the GNPA, net NPA of the June 2025. So in that way, I think it's the prudent management. What comfort you should take out of the book as of today, I mean, as we speak, that the SMA [indiscernible] data has seen a significant fall from 18 bps, it has gone down to 7 bps. The collection efficiency, excluding agriculture, which was at 98.9%, it has gone past 99% now. In terms of slippages that we have seen for this quarter, it is lower than the June quarter slippage because we can't compare with March because March is always a different quarter of [indiscernible]. So the recovery, if you combine the recovery of [indiscernible] that amount is also higher than that of the June last year. So in terms of asset quality story, I think things are quite -- I mean, the strong and the quality issue is something very benign in terms of the asset quality issue. As in today, on the books, we do not see slightly when we last interacted possibly, we're mindful of the geopolitical impact on the books. But rightly, the government came out with the ECLGS, so particularly in the segment of MSME has been protected well now. So in that, we don't see any numbers at this point of time, which talks about a stress in the book, which is higher than that of the last quarter. Stress in the book, which is normally at a minimum level and which is comparable with the -- lower than that of last quarter.

Fair enough, sir. Sir, then just my last question is on FCNR. If you could just talk about how much of the funds you have already mobilized, what is your target? And more importantly, if you provide self leverage on your balance sheet, how does that impact your margins, NII and PAT? I mean margins may potentially go down, but it is your NII, PAT. So just your thoughts on how it impacts your different financials as well. That's all from me.

MD sir, can you quickly take this last question?

Thank you, sir. So on FCNR, up till now, we have raised in excess of $600 million. And in terms of providing the facilities to the NRI depositors against their deposit, so we are facilitating them with the loan against their FCNR deposit. Apart from this, the normal NRI deposit flows are also there where the depositors are not opting for the loan against the deposit. We aim to get into the total flows of -- in excess of $4 billion to $5 billion, ballpark figure of $5 billion, which comprises of all 3 components, FCNR, FCB and ECP routes also.

Got it. And sir, how would you think about this FCNR impacting -- I mean, how does that flow through in your margins and PAT because the self-leverage when you provide would be at a lower spread. So does that dilute your NIM in the near term? And then, of course, as you deploy all of those funds, it flows down into your NII PAT, how do you think about that?

[indiscernible], if I can. Yes. So in terms of the Indian book, the deposit -- the rupee deposit cost of the FCNR deposit is quite competitive. We are offering the rupee deposit rate around 6.5%, 6.4%. And this will be our landed cost for the rupee resources. When the [indiscernible] depositors take loan against [indiscernible] deposit at the oversee jurisdiction, they are provided by the overseas branches according to their own cost of fund. That's resulting into leaving margins at that end also. So at both ends, the business is resulting into the margins.

[Operator Instructions] The next question is from Kunal Shah. We will go to Gaurav Jani.

Yes, am I audible?

Yes, no go ahead.

So a few questions. Firstly, on this entire NMC case, in fact, in terms of the disclosure, even in the annual report, we just indicated that this case is pending. But in terms of the liability amount given that it was so huge, at almost USD 600-odd million. Why there was no indication in terms of the liability, which can accrue to us even closer to the settlement of the case? And if you can just highlight in terms of what actually has been the nature of the transaction? Is it like -- obviously, this is not the lending one. This is something related to the trade finance. And finally, maybe there was some fraud and our Abu Dhabi branch has been -- maybe it is -- maybe people have said like that's involved into it. So if you can just highlight the nature of this entire case that is leading to this kind of a liability. And you mentioned that out of the court settlement was better in terms of the time, quantum, everything involved. So would the liability have been much, much higher, okay? Maybe the [indiscernible] has not been settled out of the court. So that's the first question. The second question is, again, on ECL, was there -- sorry, on fee income, was there any write-back on account of this? Was any fee written back or something which is leading to the decline over there? Anything related to this particular transaction or not really? So that's the second question. And on ECL, maybe last time also you had indicated some impact, but has there been any change in that after having gone through in detail? Any change in the ECL quantum? And margins on the core basis, if we look at it, we have seen yield on advances falling lower than that of cost of deposits. So can we say that the core margins have behaved better. And was there any interest on IT refund during the quarter?

So Kunal, coming to the NMC case, the nature of transaction, as I said in my statement, it's a confidential agreement. And the case is still subjudice as far as the other defendants are concerned. So I'm afraid that we can articulate anything on the matter. In terms of the annual report and the settlement that you talked about, annual report was [indiscernible] on the position at that point of time. The case has gone for an advanced trial post March. And the settlement has been done vis-a-vis the court litigation process, both for the Abu Dhabi Global Market court and also the U.K. court, [indiscernible] on a commercially prudent decision as advised by the legal counsel on the matter. As you know that the best of global legal forms were, I mean, engaged by the bank. Similarly, the global individual also as a legal counsel therein. So that's a prudent call. But in terms of query with regard to the case details, I am afraid I am not in position to anything articulate at this point of time. But a legacy overhang issue, we're able to resolve that. And I believe there are 2 issues here. The underlying cause of the issue is overseas jurisdiction. Payment has been made out of a overseas jurisdiction, dipping into their own resources. Domestic book is insulated out of this. The legal framework, the legal processes, these are different country to country. So we need to be sensitive [indiscernible]. In terms of the fee income, the fee income is a composite of many factors. There are income out of that. There are expenditure out of that. Book growth has been very significant. You can't load everything to the customer. Typically, and globally also, many of the cases in the advanced portfolio look into all-in cost -- all-in yield. So these are the factors that impacted our fee income, and we are trying to -- again, we say that this is an element we need to look into to optimize. ECL impact, earlier I said, the impact would be 125 bps minus a pullback of 50 bps, but both the final guidance have been issued. The pullback is now almost like 15 bps. So the impact of the ECL would be almost 110 bps on the CRAR, translating into something around INR 12,000 crores. We have the ECL provision, floating provision of roughly INR 2,500 crores. So the balance should be spread over. We have a strong -- although the CRAR is adequate. We have a strong capital base plan. So I think the migration would be smooth, seamless. The core income part of the -- that is what I'm telling in spite of this condition when you look into multiple banks, the financial results. The NII growth is at 9.5%. We are able to optimize both in terms of the earning potential of the book. At the same time, the [indiscernible] interest [indiscernible] part of the book. Obviously, that has not translated into operating profit because of the lower fee income. But at the same time, the net profit has been impacted because the cost of the full settlement has been impacted this year. You may come say that why the provision was not held earlier? As for the legal advice on a case which is under litigation and negotiation, you can't have specific provision there, right? So these are the -- I think I answered all your query, any further query, you can raise it before us, we'll clarify to you.

[indiscernible] IT refund?

IT refund -- it is something around INR 300-odd crores, I believe. CFO, what's the number?

Yes, sir. [indiscernible]

The next question is from Gaurav Jani.

Sir, just taking ahead Kunal's question. Just one simple question, right, on the NMC case. So why were we -- why did we have to settle? I believe we would be a [indiscernible], right, unless we had given a guarantee or something. So just a simple question out there. Secondly, I understand core margins sequentially would have gone up, right, adjusted for interest on IT refund. That's number two. Third, if you can just quantify the onetime impact in your staff cost seems to be up by about 20-odd percent sequentially, right? And lastly, sir, you did quantify about the onetime impact on capital of about 100 basis points. So what could be the sustainable impact due to ECL, right? One would be the onetime [indiscernible]. So what will be the sustainable impact here? Those are my questions.

So NMC case, I mean, I'm going to have to differentiate the credit engagement and the case itself, right? The settlement has been done based on the case that was going on against the bank in Abu Dhabi Global Market court and a similar case, which was pending, but on hold at the U.K. court. So you have to differentiate the credit engagement and this -- the litigation that was going on. So the settlement has been done based on the advanced trial nature of the court based on the legal advice to clear a overhang, which was there for long. And again, it's a dated case, right, dated [indiscernible]. Core margin last time also when were a 2.83% or 2.84%, I believe, on the NIM, I guided the market at 2.75% to 2.95%. Meaning thereby, there would be margin is under pressure. In spite of the fact that the NII has increased by 9.5%, obviously, the average asset has increased higher than that, impacting the core margin to 2.77% on that. The onetime impact on the ECL is an impact of 110 bps, which can be spread over [indiscernible] amortization plan therein. But earlier impact can be something around 20, 22 bps, and we have a huge capital plan. As in today, we are highly capitalized, so there is no impact on that. Stock cost has gone up. In fact, vis-a-vis March, but if you look at the stack cost compared to the June, it is below that level. But over March is because of the IAS-15 provision, which again tracks the yield movement. So in that way, that is the staff cost. Otherwise, we have a good control on the operating expenses. The operating expenses is contained. Rather, it is flat to negative. The stock cost is also contained. I mean, the increase that you are looking at the stock cost in June over March is precisely because of your IAS-15 provision, which is tracking the yield movement.

So how much would that be -- can you quantify the IAS-15 amount, the onetime impact?

I don't have data [indiscernible], either Madam Beena or CFO [indiscernible] otherwise you can share it. Madam Beena?

[indiscernible]

The next question is from [indiscernible]. He has typed in his question saying congratulations for a robust performance. Two questions from my side. What is the IT budget of the bank for the year? Any plans of raising funds through equity?

Gaurav, thank you very much, at least I got one congratulations now. So in terms of equity, I just tell you, before I hand it over to [indiscernible] equity, we have already announced earlier. It was -- we intend to reach INR 8,500 crores of equity over a medium-term outlook that's ending up to March 2028. So currently, as of today 16.3%, I do not feel there is a immediate requirement, but since the bank is growing strongly because 16%, 17% advanced growth is something sustaining that on the capital front is difficult. So bank may raise capital. But that will depend upon the timing of that our equity raise and the price at which we can raise the market, right? So that's what -- on the IT project, [indiscernible], sir, can you just take this question?

Yes. Thank you, sir. The IT budget is currently what we are having, both OpEx and CapEx put together is in excess of INR 4,000 crores.

The next question is from Jai Mundhra.

And congratulations on a steady quarter, barring the NMC thing. Sir, on NMC, I wanted to check, have you internally fixed any responsibility, any additional reaction sort of a thing now that the matter is closed from your end?