City Bank PLC. (CITYBANK) Earnings Call Transcript & Summary

Welcome to Citi Bank PLC's earnings disclosure web event of the second quarter of 2025. I am Syeda Saima Hossain, your host for the event, welcoming you today. Thank you all very much for joining us. Today, we are honored to have among us Mr. Mohamed Mahbubur Rahman, Acting Managing Director & Chief Financial Officer, who will preside over the meeting in the absence of our Managing Director and Chief Executive Officer, Mr. Mashrur Arefin, who is currently outside the country for an official engagement. Moving on to the next member of our esteemed panel is Deputy Managing Director & Head of Wholesale Banking, Mr. Mesbaul Asif Siddiqui; Deputy Managing Director and Head of Internal Control & Compliance, Mr. A K M Saif Ullah Kowchar; and Chief Risk Officer, Mr. Mohammad Firoz. At City Bank, we take great pride in engaging the investment community in our endeavors. While disclosing our performance and actions, we adhere to a strict code of full transparency and responsibility. City Bank has always measured its success not only in terms of its bottom-line numbers, but also in terms of the goals it has set for itself in order to become one of the finest banks in Bangladesh. Our success is attributed to the continued growth of our business as well as the market's evolution to satisfy the increasingly sophisticated expectations of our respective clients in the areas of liquidity, service, reliability and mobility. We have made it this far with the help of our community, team and stockholders by tenaciously adhering to the motto of service and trust. In light of this, we have gathered here today to discuss the bank's current financial situation and its forward-looking strategy. We shall start with our AMD and CFO, Mr. Md. Mahbubur Rahman, presenting the financial performance and conclude the event with an interactive question-and-answer session. Before we proceed, I'd like to inform you all that while scheduling the event, we attempted to choose the most fitting time slots that we could accommodate most of the participants from local and foreign vicinities and time zones. I'd also like to add that we have opened our Q&A portal, which you can see at the bottom right corner of your screens. During our presentation you can log in and place any relevant question through the window. We shall try our best to address them in our Q&A session depending on the time available for the program. Ladies and gentlemen, I now request our AMD & CFO, Mr. Md. Mahbubur Rahman, to start with the financial performance presentation. Over to you, sir.

Okay. Thank you, Saima. Sharing the presentation. Hope you can see it?

Yes. The present is visible.

Welcome, everyone, to our earnings disclosure for quarter 2. We are really happy to be here to present our results and discuss about the progress of the bank and our outlook. First, we will start with our macro and industry outlook. Probably you are aware of it, but just we are highlighting a few points. You all know that GDP is at this moment is around 4%. Despite having political challenges and global issues, the country is, I think, still having a good GDP rate. And projection for the GDP for next year is higher than this, as projected by World Bank, IMF and ADB. So, we are hopeful that with the strong macroeconomic indicators, the country will move to normal GDP rate around 5.5% to 6% again. And one of the major challenges of the country was inflation. We have been suffering from double-digit inflation, and which has come down to single digit after a long time. And it is now around 8.5% point-to-point basis at the end of June and food inflation has also come down. So, it's a great relief for our consumer and it's a good news for our business. And country external exposure is getting stronger. Here, you can see that export is still growing even though we hear a lot of global challenges, but still we are having around 8% export growth, which reached $48.3 billion from $44 billion. Import has also increased a little bit, reached $66 billion from $63 billion. And most remarkable achievement we have seen in remittance, which has grown by 27% from around $24 billion to $30 billion. And because of this very high growth in remittance and good growth in export. Our foreign exchange has improved quite a lot. It was around $20.7 billion, which improved to $26.7 billion according to the calculation of IMF. So current account balance also improved drastically. It was, deficit in current account balance was $6 billion, which has reduced to only $400 million. So, it's a great relief for the country from the point of external shock. So, the country is again come to a very strong footing in terms of dealing with external issues. Private sector credit growth is a little bit timid, it's around 6.4% because of, definitely you can understand because of the political issues, it is a little bit slow, but hope we will get the momentum very soon. And NPL situation is showing very actually quite, it has actually deteriorated. So, the overall NPL ratio has increased to 20%. But most of the NPL, out of this NPL actually, most of the NPL comes from the problem banks. We all know that the problem banks are actually contributed the highest amount of NPL in this overall NPL portfolio. But other than this problem bank and a few government banks, still the other private commercial bank is having much less NPL compared to this ratio. Then now we are coming to City Bank's issues. We ended the second half with a quite satisfactory loan growth. Our loan growth was 13%. You have seen that the country's overall credit growth was 6% to 7%, but we have, our credit growth is higher than the country's credit growth. And for the first time, we have crossed Tk. 500 billion in this first half. So it is another milestone for the Citi Bank. And on the other hand, interest income has grown by 28.6% from Tk. 20.5 billion to Tk. 26.4 billion. And the main reason for this higher interest rate income is the rise of interest rate, and you know that Central Bank has opted for higher monetary, higher policy rate to contain the inflation. And it actually lead to, it has led to increase of interest rate in the market, which is for the time being is good for the bank. We are earning higher interest income, as you can see on this slide. And here, you can see that our various segments are contributing quite significant growth to the overall portfolio. Wholesale banking is holding 61%. This is because, we have merged our commercial banking with Wholesale banking as most of the commercial banking customer has become quite large. So, we have merged the 2 business units into one. That's why earlier, even if you remember 1 or 1.5 years back, Wholesale banking used to show 50% contribution to the loan, but now it's showing 61% because of the margin. But it is, then Retail is the second largest contributor with 17%, Small & Microfinance 9% medium segment 10%. So, all segments are having growth. But in last 1 year, especially we are having higher growth in Wholesale banking, Retail and Small & Microfinance is also growing consistently all through the year. Deposit and here, we think that this is one of the strong area of Citi Bank. You can see that deposit is growing at a very high rate. Our growth rate is 7% in 6 months. And also in deposit, we have crossed Tk. 600 billion for the first time in City Bank history. So last year also, we had around 25% growth. This year also in half year, we have grown by 7%. Here, you may ask that why actually interest expense has risen so much. We'll explain later on. Interest rate has increased by 98% from Tk. 12.4 billion to Tk. 24.6 billion. As actually, I have already told you that policy rate has increased and because of that, all banks have increased the FD or term deposit rate. And naturally, when term deposit rate is increased in the banking industry, our customer tend to deposit their money in term deposit. So that's why our growth in term deposit was higher, and that's why interest cost has increased. But we'll show you how we have recovered this additional cost through alternative investment strategy. And here, you can see that the cost of deposit has increased from 4.17% to 5.5%. Then in the next slide, you can see that Retail contributes 61% of deposit, but Wholesale banking is also contributing very strongly to the growth of deposit by providing very state-of-the-art cash management solution. And if you look at the bar on the right-hand side, it shows the CASA ratio. It shows the decline of CASA ratio in this half. But if you look at the number of CASA accounts, we have acquired in this half year, you can see that the growth in CASA acquisition is 115% higher compared to last year half year. So that means though actually in volume, our FDR or term deposit has increased, but we are still acquiring CASA accounts in numbers. So that shows the confidence of our customer with City Bank, and it also shows the governance and the brand image of the City Bank in the market. And you can see also the Citytouch volume, which is the #1 mobile app in the country has also increased by 38%. So, it indicates that for the time being, our term deposit interest cost has increased. But with time, actually, our cost of deposit will come down as per our plan because we are acquiring CASA accounts, we are maintaining relationship with our customer. So gradually, we can adjust this higher cost of deposit with more reasonable rates. Because, and here, you can see the movement of interest income, cost of deposit and spread. Blue line represent yield on advance, which you can see that it has increased from 9.8% to 10.4%. That means 60 basis points has increased. Red line represents cost of deposit, which increased from 4.8% to 5.5%. That means 70 basis points has increased. So, cost of deposit increased more than the yield. So that's why the spread has decreased a little bit from 5% to 4.8%. But we'll show you that how we have recovered this additional cost. This is the slide which explains how actually we have recovered the additional cost in deposit by investing in bill and bond and other investment, which actually help us to recover the additional cost from deposit. Here, you can see that the volume in investment has increased by 24% from Tk. 138.7 billion to Tk. 171.9 billion. But investment income has increased by almost 192, almost 200%. So, it has increased from Tk. 5.6 billion to Tk. 16.5 billion. And the income has come from bill and bond through interest income, capital gain and other investment. So actually, whatever additional cost that we incurred for deposit, the whole amount has been actually recovered from investment income. The export has increased by 12.8%. We have seen that the country's export has increased by around 8%. So again, we have attained higher growth in export, which has reached $1.6 billion. Import has increased to $1.7 billion with 15.4%. So, our countries where import has increased around 4% to 5%. So, our growth is much higher. But the income has actually decreased because this year, the foreign exchange income has decreased drastically. Last year, we have earned it has decreased by 30%. So, because of that, this decline of foreign exchange income, actually, the overall commission and fees income has declined. But other than foreign exchange income, our commission income from trade business has actually increased. So, to strengthen our trade business, which is one of the focus area of this bank, we have launched online real-time trade solution for our customer. So, our customer can have 24/7 trade solution from us, and it is fully integrated with our core banking system and SWIP system. So, among private commercial bank, we are the first bank in the country which has launched this kind of solution. And as you know, the country is dominated by trade business, we are heavily involved in export and import business. This system will facilitate our customers to have a real-time solution, and which will actually help us to improve our credit business in coming days. So now we are coming back to other numbers. Credit card business is another area of City Bank, we are proud of. So, we are still the leader in the market in credit card. So, the base has increased by 7% and reached 727,000 customers. Credit card business has also increased by 7%, reached Tk. 26 billion. And also, credit card income has also increased, but not that much because we have actually reduced some rates. But this increase in credit card member will actually ensure a continuity of growth in credit card income. Then altogether, the revenue has increased by 25% on a solo basis and on a conso basis, 24%. So, because of the high growth in investment income and consistent growth in interest income, the revenue growth, we have attained very high growth in revenue. So the revenue has increased from Tk. 17.8 billion to Tk. 20.2 billion on a solo basis. So, it shows that we're still managing very high growth in revenue. Then after revenue, we are showing you the operating expense, operating expense, which has also increased by 23.8%, a little bit lower than the revenue growth, and it has increased from Tk. 7.9 billion to Tk. 9.8 billion. And the staff expense has increased by 32.3%. And major reason for this higher growth in the staff cost is that we have restructured our salary to reward actually our high-performing employees and also to motivate the whole team as we have been doing consistently well in the last few years. And we want to retain all the talent. So around 28% to 30% level of salary structure happened in last year. And because of that, this cost has increased. So almost around 40% of the total increase, has actually come from salary structure and the other comes from the new recruitment. We are expanding our branches, sub-branches, small segment, digital initiatives and also extending our divisions so, and also IT division. So, we are hiring a lot of people. So because of these 2 reasons, the salary staff cost has increased by 32%. Other expense, operating expenses also increased by 13%, not that much, but still we are investing in IT and other infrastructure development. Then after deducting operating cost from the revenue, the operating profit has increased by 24% from Tk. 10.3 billion to Tk. 12.9 billion. So this is operating profit actually that represents one of the key figures for any bank. So here, you can see that still we are maintaining 24% growth in operating profit in this tough situation. And cost to income, we are also maintaining cost-to-income ratio at the rate of 43%, so which is also a big success for the bank that after increasing salary cost, our cost-to-income ratio still remains same compared to last year. But the main challenge in the industry is the NPL. There are a few reasons for the increase of NPL. Definitely, the political situation change has implication on the NPL and also, sorry, NPL and other global issues and long domestic issues like probably that the industry has faced FX crisis, foreign exchange crisis for the last 2 years, which has also impact on our customer. So because of all 3 issues, the NPL ratio and volume has increased. You can see that the provision for this half is Tk. 6.5 billion, which was Tk. 4.3 billion last year. But in first quarter, we have charged Tk. 2.6 billion. So the provision charge has increased by 50% compared to last year. NPL volume has increased, volume has increased from Tk. 16.5 billion, which was the NPL position beginning of this year or close of the last year, which has increased to Tk. 24.1 billion. So ratio has increased to 4.8%. But in March, first quarter, our NPL ratio has risen to 5.7%. So we have reduced, we could reduce the NPL in volume and in percentage also with recovery, initiative, and also most important thing is that our provision ratio, provision coverage ratio has actually, was 106% at the end of last year, which reduced to 74.6% at the end of first quarter. And again, we have improved to 92%. That means out of this Tk. 6.5 billion provision charge, we are creating, we are adding additional provision against the risky portfolio. So that's why actually we are showing improvement. So we are building additional provision to manage this credit risk. And this slide shows that we have 4 subsidiaries, which are generating profit, but the subsidiaries, especially in capital market that is City Brokerage and City Capital, have some loss from their portfolio because of the situation of the capital market. But probably you have noticed that gradually, the market is turning around. So, with that, they will recover their loss within a short time. But till the end of half year, we had to make some provision against their portfolio. But other subsidiaries in one in Hong Kong and another in Malaysia, they are earning profit, not in big number. So, after consolidation, our net profit has reached Tk. 23.1 billion, which was Tk. 2.4 billion last year. So in profit after tax, the growth is still 20.7%, so we think that still is a quite healthy growth in profitability, which actually covered all the risk of the bank for, against our credit risk and also covering the market risk. Then after this profit, our ROE is around 12.4% on a solo basis, on a conso 12.75%. And ROA is 0.8%, which was also around, which was 0.84% last year, which is better than last year. On a solo basis also ROE also better compared to last year. Earnings per share is also showing good growth on a solo basis, it was 3.5%, and it is now 4.47% and book value has also increased from Tk. 27.5 to Tk. 35.12. And capital position is still healthy, though it has reduced from 2024, but we have other capital plan. So it will improve a lot. But still we are holding 14.8% capital adequacy ratio, which is quite healthy. And also we are one of the few banks in the country who are both rated by Moody's and our leading credit company, CRAB in Bangladesh. And we are attaining the highest level credit rating that is possible for any bank in the country. So Moody's B2 rating is the highest rating for the country. And AAA by CRAB is also the highest rating in the country and both has, like Moody's has highlighted our sound capital base, strong profitability, strong liquidity and especially our capacity to raise deposit. They have highlighted these strengths. And CRAB has highlighted that we have additional provision to cover risk. They have highlighted our governance structure considered as a very strong one. And also they have also highlighted our channel, strength of our channel to give financial service and also to acquire business. Then I'm highlighting some initiative about digital banking, which is the future. Already, City Bank is the first bank in the country who has launched Google Pay. And within a month, we have added 30,000 customers and the transaction volume already reached Tk. 25 million. So this is, I think this will be a major digital initiative for the bank. And here, you can see that other digital initiative of the bank, how it is growing. Citytouch already have told you that this is the #1 mobile bank in the country. Still, we are observing 38% growth. And in half year, the volume was Tk. 603 billion and number of transaction is 16 million in 6 months. And we are having around 850,000 customers. City Bank is the first bank in the country who has launched a digital banking and still the only bank in the country who is offering this kind of nano digital lending. Ticket size is around $200. We have already disbursed Tk. 29 billion. The most importantly, we have added more than 1 million customers through digital platform. And we have a smart IVR and call center. So it's giving millions of customers, service to millions of customers. And City Life is a mobile, is Internet banking for our corporate customer. The transaction volume has increased by 42%. And also, we are engaging customers and potential customers. especially young generation through Internet platform to digital platform. For example, we are tracking how many customers are checking our website. You can see the millions of customers actually check through Instagram, Facebook, are engaged with City Bank, which is actually the future for the City Bank. Then I'll end for the time being with this slide. We are very happy to share this wonderful achievement of City Bank. City Bank has, again, has been recognized as top sustainable bank in the country, and we achieved this recognition from Bangladesh Bank for the fifth consecutive year. And this sustainable financing is not only about just green banking or CSR activities. It also covers the fundamental strength of the bank, which comprises of all the core ratios and also our coverage, service coverage capacity. So, it's a 360-degree actually assessment done by Central Bank and which also give emphasis definitely on green initiative and sustainable banking. So, we are very proud to say that we are only for the 2 banks in the country who is actually consistently having this rating, very high rating from the Central Bank. And now I'm handing over this presentation to our CRO, who is also champion of the sustainable banking, who will explain more about sustainable banking. Over to Mohammad Firoz.

Thank you Mahbubur. Dear respective audience, As-salamu alaykum and very good afternoon. Mahbubur already presented about our core banking performance. Now I will show our key performance and sustainability. Firstly, I will discuss about the green finance disbursement. In green finance disbursement including the financing in renewable energy, energy efficiency, ETP, green factory and so on. We disbursed Tk. 3,340 crores in green finance in the first half of 2025 while the Central Bank target was Tk. 1,000 crores. And first half of last year, our total disbursement was Tk. 1,280 crores, while Bangladesh Bank target was Tk. 215 crores. year-on-year, our green financing disbursement growth is 165%. Sustainable finance, sustain finance means the financing that ensure the environmental, social governance compliance. And the sustainable finance disbursement in the first half of 2025 was Tk. 26,700 crores, while Bangladesh Bank target was Tk. 8,210 crores. And last year, in first half, our total disbursement was almost Tk. 20,000 crores against our target of Tk. 4,500 crores. And year-on-year in sustain finance growth is 33%. Alongside financing, we are actively reducing our carbon emission of our client operation and our own operation. And so we have joined the Net Zero Banking Alliance, as you know, of United Nations as the first Bank of Bangladesh. As part of it, we have measured our carbon emission for the Scope 1, Scope 2 and Scope 3, and we disclosed it in our website. To reduce carbon emission, the first half of this year, we financed 100-megawatt solar and 60-megawatt wind power project, which is the largest wind power in the Bangladesh. Our total disbursement in the renewable energy was Tk. 220 crores. And we've also financed Tk. 800 crores in the energy-efficient machineries and Tk. 140 crores in green building and factories. In order to reduce carbon footprint from our internal operation, we installed solar rooftop to our 39 solar power branches, 33 RATMs and 23 agent outlets. Next slide. This is already discussed by the City Bank has been rated as the top sustainable bank for the 5 years in a row by the Central Bank. We are also awarded the Best Sustainable Bank in this first half of this year by the SDG Brand Champions Award. And we have received international recognition from Bankers Magazine, Sustainability Magazine and Marina Foundation and others. If we would like to know more about our sustainability effort, please visit our website for our sustainability report. Thank you, everyone. Now I am handing over to Mahbubur.

Okay. Actually, why we have shared our sustainable financing initiative. And with us, we have also Mr. Asif, who started this initiative and achieved a lot during his tenure. Sustainable financing has become one of the pillar of the City Bank. And we believe in it. And our CRO, CRO looks after sustainable financing. The whole thing becomes sustainable. And our management, every member of our management believes in sustainable banking and financing. Even one of the major contributor of business, which is wholesale banking. They are also leading from front to improve our sustainable financing more in coming days. So, it is a tremendous teamwork and everybody in this organization actually aligned with this objective. Here also, I'm sharing another thing that not only just financial activities, City Bank is very much caring about the main resource of the bank that is the human resource. So we have also launched these 6 pillars, which ensures the continuity of the City Bank because we are just trying to build a good leadership and quality resource and happy resource. So one of our strategy of the bank is to create happy employees. So like City Cares, which ensures proper care, proper salary structure, other medical facilities, other care for the employees. Citi Innovates encourage employees to be innovative. And in our performance systems, we give emphasis on innovation and process development. And City Leads actually creates leader for the next, for taking this bank to the next level. So we have very strong management training program and other talent management program. City Careers also ensures the transparency in career path and the progress enriches to actually another pillar for the bank to improve the knowledge level and the professionalism of the employees and also maintain proper governance. City Enriches the culture in the organization. And City Commits, we are very much committed about the sustainability of the bank and the community. So these are the pillars we believe in, and we are following it very religiously. So next, I have just 2 more slides. Here, actually, I'm showing you a few recent recognition that we have achieved. One is from SME forum in SME Finance Forum from IFC. We have got award as 'Best Financier for Women Entrepreneurs'. Then we have been recognized as best retail bank by Brand Forum of Bangladesh. This is a very strong prestigious forum in Bangladesh. And also our procurement, for example, procurement division also like is one of the testament that, every corner of the bank is serious about sustainable financing through their procurement system. They have also help very CSR-related activities of the bank. So they have been also recognized by their international procurement Institute as best initiative to deliver social health through procurement. Then City Bank has won Best Bank in Bangladesh by FinanceAsia for the 9th time. And also Mastercard also recognized us for various achievements in card business. So with this, I'd like to end my presentation. So thank you all.

Thank you very much, Mr. Mahbubur and Mr. Firoz for your insightful presentation on the financial performance. And the first question is cost of fund of City Bank has significantly increased. Why City Bank is giving very high deposit rate, whereas inflation has reduced?

Sir, let me answer this question. Cost of, in end of last year, we estimated, we could actually foresee that policy rate would be increased by Central Bank to contain inflation. And because of the rate hike in treasury bill and bond, naturally customer will move to higher yield saving instrument. So to retain the deposit and also to retain, to acquire new customer, we had to increase the deposit. And this is a cycle of any banking industry when actually after lower interest rate scenario, the interest rate moves up. So when it moves up, you have to adjust your cost of deposit to, either to retain or to ensure growth. And we have ensured growth by increasing cost of deposit, and we have invested very successfully in alternative investment area. So that is a very much a short-term strategy where actually we have also succeeded. And the result also shows that we have acquired more deposit and we have deployed it very profitably in investment. So gradually, it will be adjusted with the adjustment of the policy rate. But inflation will come down, policy rate will come down, deposit costs will come down. Accordingly, everything will come down. And again, we'll have much higher spread in coming years.

Moving on to the next question. If Bangladesh Bank begins reducing benchmark interest rates, what impact do you expect on your profitability?

So actually, I think it's the same question. I think same kind of question answer is same. The profitability definitely will improve because I think Asif can also add something regarding this.

Yes, as-salamu alaykum and good evening to every one of the audience. Basically, we will be agile as the market actually changes. So we will respond according to the market. We have already, our CFO has already said that we maintain the spread despite having a hike in the deposit rate and also we could earn a better yield from our investment; if the rates come down, definitely when the deposit will come down, our cost of fund will go down. Definitely, there will be pressure on the interest rate because the market is very competitive. Now there is no cap. There is no, I think, floor for the interest rates. So the market competition will fit while the equilibrium point of the deposit and the interest rate of the loan will be settled. Thank you.

Thank you, sir, moving on to the next question. With the banking sector under stress, how are you managing credit quality in high-risk sectors?

I think Firoz and Asif, both can answer.

Thank you for the good question asking for the Definitely, this is, now this is the more risky or more I think challenging for the perspective of the banking side, a lot of changes happened in the policy level in the last year. Because of this year, the effect comes on the NPL. NPL started initially it was, I think before this present policy, this was the NPL started from the 9 months for the term loan. Now it has come down to 3 months. It takes time to the customers to adopt it and accommodate it. That's why the result of the first half of the industry, the NPL increases, but we take a lot of initiatives to reduce this NPL. Definitely, we set the risk appetite and the sector specific stat where we will go and how we go. And also, we change our underwriting standard according to this and the parameter of the underwriting. And also, I think the strong monitoring from the side of the credit as well as the business side that we can manage the quality of the portfolio.

Basically, agreeing with the Chief Risk Officer, when the risk capitals is set with the joint consultation with the risk in the business team, then as per the Central Bank regulation it goes to the Board and gets approved. Then it is submitted. It is a commitment to manage the risk and the return. Then we keep on monitoring, and the team is very good at that. They keep on informing us that how far are we from the risk capital and if we are reaching to our appetite level, or to the risk level, and they give us an early flag, and this is documented and this is one advantages we have, and we can have it on daily basis. And the movement of asset, in certain areas, which is monitored, we gradually show them the growth in that. If we need, if the market scenario changes, then we see, as we see them agile, we need to change the risk appetite, and we do it accordingly in line with market opportunities, risk, in the whole scenario. This way we are going and we can keep asset quality within certain standards; however, we are processing through the most challenging times, from last year to this year. Although the industry suffered lot more that from what we have suffered. So, we have grown in business to compensate the risk, it was more than industry growth towards the export, so the growth of double digit where export and import of the country is single digit, so we are trying to cover it up so that we can compensate the provisions from NPL, is covered from our additional revenue from the additional business.

And to just add some additional information. Also, we estimated before the beginning of the year that the risk would be higher in 2025. Naturally, we understand that after fallout of a very long regime, definitely, there would have been, there would be a big impact in the market. And that's why you can see that we have invested actually, our investment concentration has gone to bill and bond. Naturally, probably most of the banks have done this. And this is the part of the banking business. The character of the banking business is like this when actually financial industry has risk, they move to more safer zone; so we have again, that's why we have acquired high-cost deposit and we invested in treasury billboard and which is less risk, which has less risk and definitely the return is quite high. So we have nicely balanced our balance sheet position. So now gradually, the risk level of the market will reduce. And as our CRO and Head of Wholesale Banking said that customers are gradually adjusting with new repayment pattern. So they used to repay after 9 months. Now they have to repay after within 3 months. So they are also adjusting their cash flow. So when actually they will adjust their cash flow, definitely, we will go for more growth in loans in normal business, our regular business.

Thank you all for your insightful answers. Moving on to the next question. With sustainable finance and CSR performance under regulatory spotlight, how is ESG integrated into lending and governance strategy?

Thank you. Thank you again. I think the good question. Definitely. As Mahbubur already said, we, as a City Bank, we actually our DNA is set to comply the ESG in our in-house as well as our lending portfolio. For the lending portfolio, you know that we like analysis of the scorecard of any kind of rating. And we initially for, like the other analysis, we also analyze the environment and social risk. By using the ESG, we have the environment of social risk management policy, which is related to lending; and also for the, we also signed already mentioned that the Net Zero Banking Alliance of the United Nations, where we committed to reduce our carbon emission. And that's also we incorporate in our sustainable finance policy and by incorporating that sustainable finance policy, where we will go in future and how much carbon will be reduced and what sector will be reduced. That means this actually, this overall ESG now is linked with our lending guidelines, and we follow the overall ESG compliance. And also, it is also mentioned that we digitalized our ESG process that [environmental, social, and governance sustainability], that's including, it started from the business unit. Business unit just I think the ESG question, then it is reviewed by our project inspection and assessment team who also visited the customers and see the compliance of the environmental and social risk and also the, how much they are generating carbon and what is our finance carbon emission. And CRM is approved this. And if there is any kind of any action taken or action required for the future, they search for the corrective action and the corrective action also follow its review and monitored by the sustain finance team as well as the credit team. Thank you.

Also, we are also, we are publishing integrated financial reporting. Also, we are covering our social contribution, especially the CSR, we are going to have much better CSR policy in coming years. Also in terms of governance, probably you are aware that the governance structure of the bank is very strong and which is also being highlighted by our rating companies. And IFC is the single largest shareholder of the bank. So they also ensure good governance practice in the bank. So from the shareholder point of view, from the management point of view, we have a good governance practice like in management, we have 2 tier management team, actually 3 management team, senior management team, then we have management committee, we have external management committee also. So in terms of governance from Board to management, we have structured quite well.

Thank you all for your wonderful answers. Moving on to the next question. How do you plan to scale agent banking and digital channels to capture rural and SME markets while managing cybersecurity risk?

Just we are expanding very cautiously in agent banking. If you, we are not expanding very aggressively, but we need to expand the agent banking network because our digital banking, along with the digital expansion, banking expansion, we also need a physical presence. So it will be like physical kind of thing, physical for digital expansion. So in agent banking, we have also restructured the agent banking platform. So, and the security system has been beefed up with 2-factor authentication system for agent banking system. And like for every agent, every transaction at the agent banking level down through 2-factor OTP system. So once OTP is reached to the customer, then they can carry out the transaction. So it ensures a proper security. They use thumb impression for doing the transaction. And every, after every transaction, every customer is updated with SMS. So immediately, they get updated if there is any transaction. So we have actually extended the security system at agent banking point. And also for expanding our digital banking, we have also gone through all the certification process that ensures the cybersecurity of our digital platform.

Moving on to the next question. What is the outlook for your investment income going forward?

Outlook is actually it depends on the Central Bank policy. But if you look at the interest rate card, you can actually get your own answer, because the trend shows that the card will come down, and that will ensure a good return from our current investment in Bangladesh.

The next question is, if trade tensions persist, for example, new tariffs, how will it impact ForEx income and trade financing?

Is still under negotiation. So we can conclude how the outcome will come. We are following closely about the tariff negotiation. So we cannot speculate now. So I think the negotiation with our neighboring country is also going on. But the positive side is we hope that the tariff initially fixed will come down. That is the hints we are getting from different media. So nothing concrete from the government side, we are waiting for that. However, the efficiency that the RNG, the apparel sector and our textile sector has achieved in last more than 40 years. I think this remains as an added advantage because by us having a very long-term relationship with these manufacturers have been consistently delivering the quality and the time and the efficiency and the quality is one of the best in the world. And we are the second largest exporter of the app in the globe. So I think the skill set will remain as an advantage. So we are looking forward to how the negotiation goes on.

Thank you, sir. Moving on to the last question of this session. Have you implemented the 90 DPD classification rule from Q2 or April 2025 onwards?

We are 100% following Central Bank regulations. So it is in both the phases, all the reflections that you see in the NPL are a reflection of the new rule. And that's why some of the NPL pressure came out. Already our acting CEO and CFO has said that the customers are adjusting with the new trend. I think it's a matter of time. I think the, at least we can say in the City Bank, the asset quality will improve in the future. Thank you.

Thank you, sir. We have reached the end of today's earnings disclosure event. Thank you all for your participation and patience. Before concluding, let me inform you that the recorded version of this entire event will be made available in the same web link as for the live program very shortly. Those of you missed the live event or want to see through it at a later time will find the whole event documented there. The financial presentation will also be available in City Bank's website under the Investor Relations section. We appreciate your participation and patience. Thank you again for your interest in City Bank PLC. Goodbye, stay safe and stay well.

Thank you.

Thank you. Goodbye, and see you again.