IDFC First Bank Limited (539437) Earnings Call Transcript & Summary

Ladies and gentlemen, good day and welcome to the IDFC First Bank Q4 FY '23 Earnings Conference Call Hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Chintan Shah from ICICI Securities. Thank you. And over to you, sir.

Yes. Thank you, Tanvi, and good evening to everyone present on the call. This is Chintan Shah from ICICI Securities. Today we have with us Mr. V. Vaidyanathan, Managing Director and CEO; Mr. Sudhanshu Jain, CFO and Head - Corporate Center; and Mr. Saptarshi Bapari, Head Investor Relations from IDFC First Bank to discuss their Q4 FY '23 and annual FY '23 earnings. Thank you. And over to you, sir.

Hello, everyone. This is Vaidyanathan. I'm really happy to hear -- to be with all of you today.

Good evening, everyone. Sudhanshu here.

Hi, everyone. This is Saptarshi Bapari.

So good evening, everybody. I was informed by Chintan that some other conference call is going on, and he may need a little more time for people to assemble. So, Chintan, I'll go by your advice on when to start.

Sure, sir. Sure.

Sir, we are in the main call. You may continue your proceedings.

I think, sir, yes, we can start. [indiscernible] participants.

I think that that'll probably be fair respect for people who joined on time and hopefully we will be able to engage with others who join a little later. So let me just give it a start, and Sudhanshu can help you with the numbers. First of all, I want to thank every one of you listening to the call very, very sincerely, for being with us over the last 3 or 4 years while we were building out the bank and building out its foundations and all that. And we believe that after these first 3 or 4 years of building, the liability franchise has come out really very strong. We're building a brand that has come out very strong by building systems, people, processes, technologies, all that stuff. Now we believe we are in a very strong position to roll out our products, scale up our businesses, get the revenue lines in, and start seeing the opening of the jaws on profitability. I don't know if many of you'll remember that somewhere in '21 when the COVID loss was going on, I had made a statement to everybody saying that this bank will never make a loss again. There was a purpose for -- first of all, I'm very happy, it's been many quarters since then, maybe close to 2 years, not a single quarter has gone anywhere close towards that word L. The reason is that, which many people didn't understand, is that in the initial phases of the bank, the core issue for the bank was not that there were a few infrastructure loans and all that. The core issue was that the bank did not have operating profit because this was largely a DFI bank in 2018 or so, and as a domestic financial institution, as all of you know, we've seen this at ICICI, we've seen this at IDBI, everywhere initially the infrastructure loans are lent at maybe 10%, 11%, cost of funds are like 9%, you're left with a NIM of about 1.6%, 1.7%. And then that NIM, really, all of us know it won't be very profitable, and with that then very difficult to invest and so on. But what really -- but it was really an amazing, amazing thing for this bank to have gone and got it through the bank license, which really talks a lot about -- a lot of positive things about my predecessors, Rajiv Lall and all who really built an amazing institution and to go and get a license. But now the license is there on the hand. Now what to do? So I think from that the situation or from that [ merger ] point, so to say, of the Capital First and IDFC, the first quarter the operating profit of the bank -- operating profit, remember the loan book was about INR 1,00,000 crores and the operating profit was INR 276 crores, operating profit meaning the core operating profit, core NII, core fees, minus core OpEx, right? That is what is available for taking provisions for of creditors and all that. So that number was -- core operating profit was INR 276 crores. Now even after that, of course, we had to invest in branches and all that. Now, by the period of 2021-2022 -- Q1 FY '22, that is, April, May, June of '21, in that year also we did not have much of an operating profit, but we had [indiscernible]. But the good news is that that operating profit for the bank, let me tell you, a trendline for the last 4 quarters and then you will see where the game is headed, that INR 276 crores of core operating profit in Q1 FY '23 was INR 987 crores. Q2 of FY '23 it is INR 1,052 crores. The first time we decisively crossed the INR 1,000 crores barrier of core operating profit. In Q3 FY '23, that is October, November, December of '22, our core operating profit is INR 1,225 crores. In Q4 FY '23, this quarter, our core operating profit is INR 1,342 cores -- 1,300. So now even if there's a [ COVID ] theoretically and even if there is the same intensity of what came in Q1 of FY '22, which is that 2 months of lockdown, no moratorium. Even that extreme situation, our bank will be like sailing through comfortably because we have a lot of operating profit now. So this is a very fundamental point to note that we are on a very strong wicket. We believe the way the incremental economics are coming about, which is what is giving us this operating profit, that is going to look -- that we believe has almost reached that level of permanency and then now whatever happens to the global ecosystem, an odd crisis comes, if something comes, something goes, that happens to everybody, and we will deal with it very, very comfortably. Now the second part of the conversation is that if you see the trendline of profitability over the last 4 quarters on a PAT basis, it was Q1, Q2, Q3, Q4 of this year has now moved from INR 474 crores Q1 to Q2 was INR 556 crores, Q3 was INR 605 crores and Q4 is INR 803 crores. There was some onetime income through Treasury. But even if we take it out, core operating profit of -- PAT of this quarter would probably be [ INR 701 crores ]. So therefore, you can think of it like sequentially it's more from INR 605 crores to INR 700 crores. So we believe this is a story for good, and we're all pretty feeling good about that. It actually gives us confidence more than anything else, it gives us -- frankly, we were insiders, so we always knew that the bank is headed for really good times and I always felt very good about the bank. I feel very bullish. But then from the market's point of view, until you see the numbers, you won't believe it, so I agree with your feelings. So now at least I'm feeling very confident. Hopefully after hearing today's call, you get a good color about where the bank is headed. So I'd like to close here, and I'll request my colleague, Sudhanshu, to take you through the numbers.

Yes. Thank you, Vaidya. Friends, I will start with the balance sheet metrics and then talk about asset quality and this will be followed by profitability. On the balance sheet, the overall balance sheet of the bank grew by 26% on a YoY basis to reach about INR 2,40,000 crores at March end. We continue to see a healthy growth on our lending book and in deposit mobilization. Custom deposits for us grew strongly by 47% YoY to reach INR 1,36,000 crores. The yearly growth in CASA deposits was 40.7% and for term deposit it was 54.2%. CASA balances grew by 8% sequentially, and we saw a relatively faster growth in term deposits at 13.6% due to increase in the overall systemic rates. CASA ratio was stable at around 50% as on March 31st, 2023. Average CASA ratio stood at 48.5% for the year. Even on average current account deposits, we saw an increase of 48.6% during the year. CASA and term deposits less than INR 5 crores was at 83% of the customer deposits as on March 31st, 2023, which points to granularity of deposits. Retail deposits stood at 76% of the total customer deposits at March 31st, 2023, and it grew at 53% on a YoY basis. We opened 102 branches during the quarter and the branch count now stands at 809 branches. The banks maintained an average LCR of 120% during Q4 as against 122% in Q3. We would like to maintain the same around these levels. We continue to see a reduction of high cost legacy borrowings. It has reduced by INR 7,500 crores odd during last 1 year and the residual amount left is now INR 17,673 crores, which will run down in next 2 to 3 years. About INR 5,100 crores is scheduled for rundown in FY '24. We have given details around this on Slide 29. Moving on to assets, I'm happy to report that the overall funded assets have crossed INR 1,60,000 crores and grew by 24% on a YoYo basis. Retail and commercial book, which is well diversified, grew to INR 1,26,000 crores. We saw strong growth across all product segments. To give some more color, home loan grew by 39% on a YoY basis. We saw disbursements holding up well in this segment despite increase in interest rates. Wheels segment, which includes 2 wheelers and cars, registered strong growth of 53% on account of festive demand and our increased distribute. Consumer loans, comprising of consumer durable, personal loan, and cross sell loans grew by 20% on a YoY basis. Rural finance book grew strongly by 48% on a YoY basis. Credit card, which comes off from a small base, grew by 74%, on YoY to INR 3,510 crores. The bank has issued more than 1.5 million cards since launch in January '21. Spends on credit card increased by 92% on a YoY basis. On the wholesale side, non-infra corporate loans grew by 9% YoY to INR 26,000 crores. The infrastructure book degrew further by 32% on a YoY basis to INR 4,664 crores and is now nearly 2.9% of the total funded assets as compared to 5.3% a year earlier. Moving on to asset quality, the drop in the net NPA of the bank has further improved by 45 and 17 bps, respectively Q-on-Q and stood at 2.51% and 0.86%. PCR, gross of technical writeoff, stood at 80.29% at end of March quarter. The bank has significantly increased the PCR in the last 1 year from 70% to 80%. In fact, if we exclude the rundown infrastructure lending book, NPAs, then GNPA and NNPA at bank level stood at 1.84% and 0.46%, respectively, and provision coverage gross of technical writeoff moves up to 87%. Retail GNPA also improved sequentially by 22 bps to 1.65% and net NPA is down to just 0.55%. The corporate non-infra book continues to be well provided with the PCR of 99.8%. Net slippages during the quarter were lower by 21% despite increasing the overall book at INR 468 crores. The overall standard restructured book as a percentage of total funded assets has further reduced to 0.6% as compared to 0.9% last quarter. The brand holds a provision cover of 25% on this book. The SMA1 and SMA2 on the retail book is stable at around 1% and much lower than 2.2% a year ago, which is a good indicator of portfolio quality. Even in the corporate book, the ratio of SMA1 and SMA2 is sub 0.2%. Moving on to the last section, profitability. Our profits for the year have increased to INR 2,437 crores as against profit of INR 145 crores reported last year. This is on account of increase in pre-provisioning operating profits, including treasury gains by 50% as compared to last year and also lower provisions by 46%. Profit after tax in Q4 increased to INR 803 crores versus INR 343 crores in Q4 FY '22, up by 134% YoY and 33% Q-on-Q. This was largely driven by strong growth in operating income. On a quarterly annualized basis, the ROE continues to expand and for the full year it stood at 1.13%. The ROE has crossed, I would say, 10%. In fact, it's at 10.95% for full year FY '23. The net interest income for Q4 '23 grew strongly by 35% YoY to INR 3,597 crores. Fee and other income also witnessed an increase of 40% YoY to INR 1,181 crores for Q4. Retail fees contributed 91% of the overall fee and other income and hence it is quite granular. We have given more details around the fee breakup on Slide 51. The bank had a trading gain of INR 216 crores in Q4 FY '23 as compared to a trading gain of INR 36 crores in Q3 FY '23. The gain during the quarter was primarily due to monetization of certain [ BCF ] investments. The bank utilized INR 79 crores. Out of this to increase the provision coverage on loans during the quarter. Core operating income, excluding trading gains for Q4 FY '23, increased by 36% to INR 4,778 crores, aided by strong NII and fee income growth which I mentioned before. Operating expense was INR 3,436 crores in Q4 FY '23. Cost-to-income ratio improved to 71.9% in Q4 FY '23. In fact, for the full year, it has improved by 525 basis points. Core operating profit, excluding trading gains, grew by 61% YoY and 10% Q-on-Q basis to INR 1,342 crores. Provisions for the quarter were INR 482 crores due to certain additional provisions done during the quarter as mentioned earlier. The credit cost as a percent of the average funded assets for Q4 was at 1.26%. For the full year, it was at 1.16%, much lower than our earlier guidance of 1.5%. The bank has maintained strong capital adequacy and the CARs, including profits, was at 16.82% as on March 31, '23 with CET ratio at 14.2%. The bank is well above the regulatory threshold and looks forward to continue the grow in a profitable manner. With this I close my opening remarks. We are happy to take questions.

[Operator Instructions] The first question is from the line of Mohit Surana from CLSA.

Congratulations for a great set of numbers, Sir, my first question -- and thanks for giving the disclosure on cost-to-income. So I just wanted to understand that in a little more detail. When you say that the cost-to-income and liabilities has gone down from 198% to 174%, how should we read it? What should be the income that we would be getting from liability?

First of all, Mohit, happy to hear you, and hello to everyone again. Now, yes, this time we have given much more detail about this cost-income ratio. As everybody knows that our cost-to-income -- people always talk about the cost-to-income, so this time they are given 2 sets of information: 1 is we have given you a full trend line year by year what the cost-to-income was over the last 4 years. So it was 95.13% in Q2 of FY '19, in H2 it was 85.22%, then FY '20 it was 76.86%, then 78%, then 77%, and now 72%. So you should expect this should come down from here. Now, with regard to the breakup, since you referred only to liabilities, but in the benefit -- for the benefit of others on the forum who may not have seen that particular slide, let me just read out the numbers to you. On the retail side, our cost-income last year has retail -- lending side cost-income has come down from 63.4% to 55.0%. On the wholesale side, cost-income has come down from 38.1% to 31.6%. Then you might say that, listen, if your cost-income is as low as 55% in retail on the lending side, if it's 31% on the wholesale side, then really what is lifting the cost-income? So there are 2 items: 1 is the liability side, which is 173% we referred to; other is credit cards which is 164%. So the sigma of all of these 4 put together is the number that you see the 72%. Now let me just explain this number what you asked for liabilities, 170%. So in the liabilities business, what happens is that, a branch raises deposits. The branch could be raising savings accounts, could be raising current account deposits. So on savings accounts, we give them a particular transfer pricing, which is a benchmark for them, and the difference between the transfer pricing and the actual money the branches pay out to the customers, the differential is the income of the branch. Similarly, the difference between a benchmark and 0 is the income of the branch as far as current account is concerned. That is income for the branch. The expense for the branch is the really cost of the branch, people and premises and rent and all that. And the other income is, of course, the fee income. So sigma of all that is, at this point of time, for the bank as a whole is a loss and that is what is giving us the 170%, which is basically income is less -- expense is more than income. Now how will this come down? Well, very simple. By the way, I described the equation to you. If the branch grows more deposits, then the difference between the numbers I told you, the benchmark minus what they pay the customer that keeps increasing, and then the branch becomes profitable. And of course, if the branch sells more [ fee-based ] products, et cetera, et cetera, the branch makes more income. So this is -- the short of it is that as the branch gets more scale and size and more customers and more deposits and all that, this is a self-solving problem and we believe that this for us also it will trend that way.

Just 1 follow-up. What should be a reasonable transfer pricing for deposit that a branch did? Any color on that?

Normally I don't think banks disclose that number, but I'd say that clearly if you look at the [ GSEC ] pricing of the moment, you should expect that, that would be a bit of a risk-free pricing for the situation.

Okay, got it. Got it. Sir, the second question is that when we look at IDFC Bank, it's obviously done very well on deposits, and a part of it is because the branch efficiency or the deposit efficiency per branch is quite a healthy number. So just 1 color on that, is that how many years, probably even a rough ballpark, does it take for a branch to reach its full potential in terms of getting liabilities and deposits. Any color on that?

I don't know if you've been to any of the IDFC Bank branch and have spoken to any of the employees there. They'll probably give you good color, and I really invite you to do this at random in any branch of the country. Our people are really very happy that -- basically the branches are not the only thing. The brand that powers the customers to come to the branch, the service that we give to the customers at the branch, all that is also playing a role. So in our case all this machinery is playing very well. Somehow the bank's image is really very good. So our branches are typically in about 24 months, you can see a breakeven or probably even a bit earlier, depending on branch to branch, depending on the cost of the branch. And we are at least finding that our branches are frankly very, very productive.

Got it.

So we are feeling frankly that we really got this liability machinery fantastically going for the bank. We're not really -- we feel very confident for the next year, and we feel that this will keep -- money will keep coming in comfortably, and then we have -- now we have the peace of mind to grow assets comfortably in a safe manner.

Got it. Sir, just last 2 questions. One is if you could explain, we had held the Treasury gains in the quarter, what explains that? And if you could also give the comparable NIM number versus last quarter of 6.36%? And sorry if I missed that in the PPT.

Yes, it's there in the PPT, but maybe it came a little late for you, so you may not have found -- read it, but let Sudhanshu answer the question first and then I'll comment...

Thanks, Mohit, for the question. First on the Treasury gain, as I mentioned in my opening remarks, that we had certain gains from redemption of venture capital fund investments which we were holding. So that came as a gain during the quarter. It's onetime in a strict sense. That was slightly more than INR 200 crores odd. On the NIM for the quarter, NIM was 6.41% gross of sell-downs in IBPC and the corresponding number for the previous quarter was 6.13%.

Sudhanshu, last quarter reported NIM was, if I'm not wrong, 6.36%. So if you could also give a like to like or probably I can take later if it is not handy.

That you can take like to like -- you can probably just do -- you can just adjust for the [indiscernible] sell-down and all that. But let me just say that last quarter was 6.13%. You can make the appropriate adjustment.

The next question is from the line of Vivek Ramakrishnan from DSP Mutual Fund.

Congratulations on excellent performance. My question was going to be about the deposits only. This year seems to be a year of scramble for deposits. What do you think is going to propel your deposit growth? You seem very confident about that. Is it, by tweaking the rates, giving a higher rate, what is that secret sauce for getting more deposits? That's my only question, sir.

Honest answer. Have you been to any of our branches?

Yes, sir, I have.

It's okay. Do you feel the comfort?

Yes. Generally, they've been very pleasant, sir.

Okay. Thanks for that. No, because the reason I ask is that if you talk informally to people there or something, they'll probably give you a color. Somehow we are probably paying the similar interest rates like what, let me say, the peer banks are paying. What we call peer banks are the mid-tier banks. Think of IndusInd, YES Bank, Bandhan, our bank, or maybe 1 or 2 more banks, maybe [indiscernible] in that category. So think of these as mid-tier. They're all paying similar rates. Probably they're a bit lesser than NIM, but somewhere in that band. But somehow our hit rate per branch is significantly better, and now we've got figure out what is the reason if you're paying similar rates. I think definitely our bank is just seen as a really good brand, not that others are not. They're also good brands. But somehow we've acquired that very strong institutional image, feel. I think customers who are experiencing us are referring more customers because they say [Foreign Language] that kind of stuff. I think all that is coming together and then rates are what we pay.

Actually, beyond asking for INR 2,000 notes, I've not interacted that much, to be honest.

No, you must. You see if you see our deposit growth, this year our deposits have now come to 71,000 -- CASA deposits are INR 71,900 crores. But that [ 71 ] is not actually in the INR 71,000 crores because the last 2, 3 days before the quarter ended, somehow some large government institutions gave us INR 2,131 crores really short-term money. We don't want to count that money. But even if you subtract INR 71,983 crores minus INR 2,131 crores, it comes to something like INR 59,800 crores. So that's a very solid growth coming from INR 51,000 crores of last year. So we are definitely strong beneficiary and things are moving for us well.

The next question is from the line of Lalit Deo from Equirus Securities.

So I have 2 questions. So firstly, sir, during the quarter, we have seen some increase in our saving rates as well. So on a blended basis like what would be our rates on the saving deposits and how much it could increase going ahead in terms of the repricing?

Sudhanshu.

Yes, Lalit, SA rate for the quarter for us was about 5.37 basis points -- sorry, 5.37%. And this was up by about 10 basis points only during the quarter.

So we basically up to INR 10,00,000 we're still paying only 4%. So as you know, that's where the bulk of the customers are, and we pay on a progressive basis after that.

So the bulk of the major repricing has been done or are there some parts which is likely to come in the coming quarters as well?

We don't know. We don't know. As you know, I never take a position on this.

Actually, in the retail loans, so while there has been a broad-based growth across segments, but particularly in the rural finance, we are seeing some strong growth over there. So could you quantitatively tell us like what is the [indiscernible] and in which segments are you lending in this segment -- in this particular segment?

What we are growing on the lending side is frankly very well disclosed by now in the sense that we have already put out our lines of businesses; home loans, affordable home loans, cars. Now we started new cars also, by the way, not in a big way, but still we started new cars, we started tractor financing, and now we started, of course, we're already been doing used cars for a long time, we are good in 2 wheelers, we're doing microenterprise loans. The list is very, very long. In fact, somewhere in the investor presentation, we have actually put out a full list of products that we are doing. The commercial vehicles, then business banking, then -- the list is long. So it's a very, very long list [indiscernible] last 7 or 8 years, it's just a long list. So for us, frankly, the -- for us growth, at least, we don't think of this as a bother at all. It's just coming. In fact, we just don't have to touch the credit criteria, we don't have to relax anything. If you need more business, just open more locations and keep launching new products. So at least for us to -- at least for many years to come, I don't think growing credit is an issue at all.

The next question is from the line of Ishan Agarwal from Erevna Capital.

So first of all, congratulations to the entire team for a superb set of numbers once again. I must say that the execution by the management has been to the T since merger and has exceeded my projections almost every quarter. So now I'll begin with my questions. We have reported total provisions of INR 483 crores this quarter, out of which I believe INR 79 crores is onetime in nature so as to include the provision coverage ratio. Excluding this, our provisions for the quarter stand at INR 404 crores, which when annualized stand at 1.03% of the book, which is lower than what we have been reporting in the past quarters. Is this a structural lowering of credit cost due to better quality of sourcing and overall better quality of the book?

Well, you know that we have always put out our credit cost numbers for 10 years now. And we've put out our gross numbers, we've put out our net numbers, we've put our credit costs also for 10 years now. So we have given a guidance, as you know, for 2% credit cost. If you remember, we always talk about [ 2-1-2 ] formula, right, 2% gross, 1% net, 2% credit cost. But somehow, yes, the credit cost for us is very low at this point of time. To your question on whether it is structural, we believe that this part has become structural, and we keep the guidance there because just that we don't want to let anyone down in what we're guiding, but we believe that...

I'm just asking you without any one-offs or any other...

That's what I'm saying. So basically, we have given guidance of 2%, because we don't let down people, but we feel that structurally, to answer your earlier questions, structurally we believe it has come down. We believe we'll actually not touch 2%.

I think you had mentioned 1.5% previously, no?

Yes. We used to -- we have on our Annual Report guided for [ 2-1-2 ] but for the last year we did guide 1.5%, but we have come below 1.5%.

Okay. So for the next year, it could be 1.5% or lower than that?

Could be there, but our own internal estimates are more like there. But we have kept our public guidance where we always left it. But if you have to pencil in what should be a good number, I guess, yes, somewhere there what you're talking about. But the other thing is that -- the more important thing is that, your earlier question, I thought you asked important question. It kind of slipped between the cracks. Is this issue -- is it structural? Now really, we believe it's structural. We can't take the eyes of the ball. As a bank, we should be always careful. Structural meaning -- what I mean by structural is that now credit appraisal processes, information -- let's think of a process, think of KYC. Earlier KYC was coming, say, through a passport copy or a license or whatever. Now it's coming digitally, biometric authenticated, and VKYC and all that, it's become more authentic. Then what is the next step, you do credit appraisal. Credit appraisal was coming through some physical paper and all that. Now it's coming digital and it's that much more authentic. Then after that is monitoring. You used to have frequency of monitoring probably monthly or something. Now you're practically doing weekly or daily monitoring, so that's also become better. Collections was coming in, somebody was calling the customer and going and collecting from the customer, all that. Now all that is gone. You send a UPI link for collecting. So everything has become better now structurally. And bureaus have come. You know how this works.

And the bank itself intentionally is also sourcing better quality customers along with the systems becoming better. Is that right?

That is 100% correct, because now our cost of funds is less. We don't have to take risk like NBFC. We can pay like a bank, like a good large bank.

Okay. That answers my question. Now, moving on to the next question. This year, our core PPOP growth has been phenomenal. We've reported a 67% growth as compared to FY '22. My question is given that a significant portion of the operating leverage is still to play out in terms of cost-to-income, and I remember in 1 of your media interviews you had mentioned that core PPOP could grow by 40%, 45% in FY '24 and '25 as well. Do you believe by your internal estimates the bank can achieve that kind of growth?

First of all, this year also we said 45%, 50%, it's turned out to be 60%.

Correct.

So we're very happy at least we didn't let you down this year. Yes, but next year, yes, definitely we're feeling very good. We believe that we will outrun our cost growth. So if our balance sheet grows by 25, yes, of course, our PPOP should grow -- definitely should grow faster than that because our scale is playing up, yes.

I have a few more questions if I can...

Yes, sorry, Ishan, I would request to please come back in the queue. There are many participants waiting. The next question is from the line of Anand Dama from Emkay Global.

Sir, 1 question is that if you can provide some breakup in terms of your SA deposits, how much is less than INR 10,00,000, how much is above INR 10,00,000? That would be really helpful to start with.

I don't think we're giving that number. Sudhanshu, do we have the number?

No, we're not...

Broadly if you can give us...

Just repeat the question. Less than INR 10,00,000. Ask the question more specifically.

Yes. So the question was about how much of your SA deposits would be less than INR 10,00,000 and above INR 10,00,000.

I don't have the number offhand, but I...

Ballpark?

I don't know. I don't have the answer right away. But maybe let me just say that our bank, if you're trying to get under the hood and trying to get a color of a customer profile, if that gives you a better sense, we are, let me say, getting a slightly higher than, let me say, upper middle class-ish customer base, if that's -- and a slightly HNI-ish kind of customer base, maybe the location of the branch or the look and feel or whatever, so our average balances that we're getting are, let me say, at least 30%, 40% more than maybe the similarly-placed banks.

Okay. So would that basically put more of the deposit into the above INR 10,00,000 bracket?

Yes. For example, when you open an account, as you know, we have 2 categories, 1 is a INR 25, 000 and 1 is a INR 10,000 account, okay. So the INR 10,000 account, the minimum balance is INR 10,000, but people are keeping INR 40,000, INR 50,000 with us. The INR 25,000 account minimum balance is INR 25,000, but people are keeping 1.5 lakh with us. So that gives you the color of the profile. Somehow it is the way it is. The bank is getting that kind of deposits.

Okay. And is there any breakup in terms of retail deposits and some kind of institutional SA deposits which come by in the overall SA breakup?

Again, your voice is not coming so clearly. Can you repeat your question, if you don't mind?

Anand, I would request you please speak through the handset in case you're using...

Yes. Is it better now?

Yes.

Yes. Sir, I was saying that within the SA deposit, what's the share of the retail individual deposits and the nonindividual deposits?

Well, everything is individual only in the savings side.

Yes. And as I mentioned, retail deposits are 76% of the total deposits. And we have seen a good growth during the year. In fact, it grew at 53% on a YoY basis.

Yes, that includes term deposits as well, right?

Yes.

I'm just talking about the SA deposits.

Yes, it's predominantly retail only. But I'll tell you 1 thing, there's 1 weakness our bank has, it is actually the fact that -- see, frankly, SA our bank is hitting it over the park. I'm telling you, we are really doing well. You just have to take our word for it. The weak area for our bank is that we have low on CA. If you see peer banks, or at least peer banks, meaning the larger peer banks, so to stay, close to about 30%, 35% of their balance is current account balances out of the CASA. For us, it's like 15%, 16%.

18%.

18%, so it's about 18%. So this is a -- but as you know, current account takes a long time to build because you've got to get the whole ecosystem and all that. But we're working on that. I think we'll get there.

Yes, on your earlier question on SA, 97% is retail, so it's predominantly retail.

Okay, so we got your answer while you are on the call.

Okay, great. That's a good number. Sir, secondly, [Technical Difficulty] and if you look at the cost-income ratio, where you have guided that you would look at about a 65% kind of a cost-income ratio maybe 2 years down the line. If that is the case, how do you see that cost-income ratio coming down? I understand that 1 [Technical Difficulty].

Anand, there's lot of disturbance on your call, just to save other people's feelings, let me just -- but I got the question, let me answer the question quickly. How will it come down?

Yes. The first was what is basically the...

I got it. So how will it come down? Okay, we've guided for it to come down. The question is how will it come down? It's very simple actually. It's not so complicated. First of all, I told you the trend how the last 4 years have been. So it should give you confidence that it will, but rather than just [ believe ], I'll give you specifically. So, for example, our key gap is credit cards. Actually, we have 2 key gaps. I called them out to. Show me the page. There were 2 things we called out for you, 1 was the credit card, second was liabilities. Liabilities I answered 1 of the prior gentleman who spoke, saying that -- I think it was Mohit -- where we were just saying that, look, book growth, branches will pay back. It's straightforward. And I'm making it too straightforward. Of course, they have got to do their work, they've got to sell the other products, they go to cross sell multiple products, et cetera. They get the fee income, generally book growth, NII growth for them, and they break even. It's very straightforward. Now the second business is credit cards. In the credit cards, we are current -- last to last year, that is in FY '23, while we haven't put out the numbers on the presentation, but I remember it was something like 300-odd percent. Last year FY '22, it came down to 240%. This year FY '23 it's come down to 160%. We believe in FY '24 this should convincingly come down. It's more like maybe 100% or maybe even less than that. And FY '25 we expect to break even credit cards. So think about it. So if that amount of credit card business starts breaking even, that is straight to the P&L and that reduces cost-income. So that is 1 factor. You can do the math for yourself, you'll get it. The second part is the what Saptarshi earlier pointed out to you that we have the INR 17,000 crores, INR 18,000 crores -- Sudhanshu said that you have INR 17,000 crores, INR 18,000 that we are funding today at 9%. Now moment we replace that with today's money this 5.7%, 5.8%, you see the difference, that 3%, 3% on that INR 17,000 cores, that's INR 500 crores. So that is also going to come to the income line. So that straightaway equates to [indiscernible] cost-income ratio. So you should not at all be surprised it will come down. And what you should actually look back and think is that if you're already posting 1.2-ish ROA, and now at our current cost-income at 70-odd percent, imagine 70% comes to 55%, whenever it comes, just see where the -- you do the math for yourself. There's 10% on our NIM -- of our NIM. Just do the math and add it to the ROA, you know where this ROA will hit.

Sir, you have basically put out on Slide #53 where you put out the cost-income ratio across segments. So apart from cards, which is about 165%, is there a chance that basically the liabilities and the wholesale banking cost-income ratio can come down further? And if there's any estimate, you can give us.

Yes, yes, see, even liabilities will come down. But the liabilities is a long game to break into 0 let me tell you. In 1 of the prior banks I worked, it didn't breakeven for 12, 13 years. So these things do take a long time, because what happens is that we are a startup bank, so you might say that end of the day, remember that we got to raise deposits, so we might put more branches. And those branches we put in will have its own life cycle to start becoming profitable again. So these things drag -- sometimes tend to drag a little bit longer. But see the end of the day, my own sense is that we shouldn't keep knocking ahead on this 1 line item of cost-income, cost-income. Well, end of the day it is what a return on equity do we generate. And we are pretty clear that even at our current cost-income, even if a marginal dip from this 70s coming to 60s, there will be a massive improvement in ROE. And frankly, if once a bank goes to 17-ish, 18-ish ROE, forget 17, 16, even if it goes to the 15-ish ROE, lot of the people who think about this issue a lot, all of you will come down and you will become happy. Just watch the trend. Just watch 3 quarters more, 4 quarters more.

Sir, certainly, we'll all be happy, but then if we can get some glidepaths as to which element basically would see that improvement?

Okay. Let me -- I told you 2 specific things. One is credit cards, second other liabilities. We don't know how. Third, I tell you that, 3, that legacy cost of funds that 8.9%. Fourth is that fee income, these are all -- these are ones that are looking in the eye. But let me tell you 2 more line items which are also important. Fee income, because we are not exactly doing a great job in getting fee income from -- on the liability side. As you know, most of our services are free there. And even our cross-sell -- you may not have got very many calls from the bank to sell you the X product of Y product because we keep it very little toned down because we don't want to disturb customers. But net-net fee income -- there's a big opportunity for us on the fee income side to grow it, wealth management is growing by 40%, 50% a year. That will give us fee income. FASTag business is growing, that will give us fee income. So we have many buttons to press. Just watch the game and fee income will go up, the other buttons I told you will work. So it will come just watch this quarter -- watch this year end, watch next year end. I'm sure it will come down.

Sir, lastly, just wanted to check, again, you have given this cost-income ratio of 174% for liabilities. This cost for other banks, I'm sure that you would be aware about broadly what kind of cost-income ratios that they operate. Is it something similar or it's far lower?

No, no, it depends on life stage. If you go and pick a bank like 1 of the big banks which have lived its 25, 30 years like ICICI or HDFC, obviously, it will be profitable, undoubtedly. It's a life stage, everybody is forgetting. Man, our bank is just 4, 5 years old. 5 years, meaning 4 years after merger. And that time our balance sheet was -- the loan book -- deposit was INR 5,000 crores, INR 6,000 crores of deposits we had retail, so let take it practically to start. So really, well, hello you give me 15 years, I'll show you what cost-income and what ROE this bank will make. It's really early, 5 years. And meanwhile, remember, we're rolling out all the [ branches ], et cetera, and we're roll out more also. So honestly, I've told you people many, many times before that I'm building this bank for the long run. I'm not taking shortcuts to say that, oh my God, I've got to please everybody. Post some ROE to this and do it now and kill it. We're not playing that game. We are just building for long run, and it will take a little more time. But I will deliver ROE that I'm telling you.

The next question is from the line of [ Pranav Tendulkar from Rare Enterprises ].

Sir, I just wanted to ask a question. In which of the credit originations...

[ Pranav ], sorry to interrupt, your voice is not clearly audible. Please use the handset mode.

Can you hear clearly?

Yes.

Okay. Yes, I just wanted to ask 1 question. So I understand the philosophy that credit origination yield is driven by market and then we do better by selecting better credit in that asset category. So can you just qualitatively or quantitatively highlight in which credit categories we have the best credit origination processes? And what are we doing about it? So is it SME, MSME, is it vehicles, and how we are improving it? So can we? Can we proudly say that we are #1 in terms of credit yield minus provision cost metric for the business?

So Pranav, as you would see from the presentation, we have a very diversified retail book, right? So we have been doing home loans. That book has been increasing. It increased by 40% on a YoY basis. We have a loan against property which we have been doing for quite a number of years, right? Then even on, I would say, on the Wheels segment or the 2 wheeler space, we have been gaining market share there, right? Rural we saw very healthy growth during the year, right? That also meets our PSL requirements. Then we are a formidable player on, I would say, consumer durables and so on. So it's a wide asset class, and we have a stated strategy to grow each and every product, of course, while at the same time ensuring that the credit standards are not compromised. If you see the presentation on Slide 36, we have given that we follow a very elaborate process in terms of credit screening, and in this process we do reject many applications which come into the bank, right. And it's all scorecard driven, which is also quite evolved, I would say, over a period of time. The data from the bureaus is also quite enriched now, right? So all these are playing out and all this results into a lower check bounce, lower SMA, and the resulting NPA formation and so on. So we feel that with the model which we have, where on the retail assets, we have a blended yield of about 15%, 15.5%, credit cost is quite currently manageable, and if we are able to maintain at this pace, then we feel that we are in a good run.

See, 1 of the key things to note for our bank, and I think very, very important is to actually think what is the collection efficiency. Right now Sudhanshu talked about that we have good underwriting process, yes. Okay, by definition, if you do good quality underwriting, when we present check, they should not bounce, yes, our check bounce is very low. Then when we say checks are bouncing very low, then whatever is bouncing, someone should collect on them. I'll tell you a number, and you can compare this, 1 of our large NBFCs even report these numbers as well now. Now we have actually even disclosed our check bounce percentage -- sorry, collection percentage. It is 99.5% is our collection. Let me explain 99.5% to you. This is EMI collected divided by EMI due. This does not have arrears. This does not have prepayments. Sometimes some entities report I got 104% collection. How can someone collect 104%, 107%, only because they're collecting either prepayments or collecting arrears. I'm telling you pure what was due and what was collected. That's 99.6%, and it is not a fluke once in a while. Now it's been like 12 months in a row it is 99.5%. Now, therefore, only 0.5% slips to 0 to 30 bucket. So that's it. That's really phenomenal. And that's it. Then after that -- that is what gives us the confidence to commit this 2%, 1%, and whatever we tell you.

Superb. Sir, I just got confused about how you calculate branch cost-to-income. If you just explain that to me, that will be great.

No, I think somebody else also asked the question, so if it's not clear, we'll explain 1 more time. Now think of a branch. Let us say branch is a cost, people, premises, whatever is the cost of a branch. Now suppose a branch gathers deposits of INR 100 crores and suppose as a benchmark X percent is what is payable to the particular branch for raising savings account. So suppose a branch is INR 100 crores of savings accounts and suppose the benchmark is X and suppose the branch paid 5.5% to customers, the difference between the X and the 5.5 becomes the income of the branch. But if that branch now grows to INR 200 crores, the income will become 2x. If the branch becomes INR 300 cores, income becomes 3x, but OpEx is not becoming 3x. OpEx is what is the cost, what you pay rent or people. So that differential with scale goes up. But on a current account, the branch will get -- in the same example, will get the 0, it will get the full amount because you're paying nothing to the customer. So that's how the economics work.

Got it, got it. Basically, you are communicating this to branches and that is very, very good communication mechanism actually. So the branch-level profitability is driven by it.

No, just for the sake of argument, let me just pick a number. Let me say 7%. Suppose you told the branch that whatever deposit you get, I'm going to pay you 7%. Now if the branch gets, say, INR 100 crores of savings account and they paid the customer say 5.5%, that's 7% negative 5.5%, 1.5% on INR 100 crores belongs to the branch. They made INR 1.5 crores.

Right.

You got it. And now if the branch is now a INR 200 crores branch, that is going to make INR 3 crores. And then that's how it scales and productivity a branch starts making money. So we're not worried. This is how it works. And I've done this before for a long time now. It works.

Right, right. So actually, is it getting used for communicating various targets that your bank has to branches also? Is that your future plan? I see that there were many branches in many banks where transfer pricing is also not clear, but you have taken this step and that is a great step, actually.

It gives clarity to that person also, the person knows what to do. Now the other thing is there. If the branch, say, suppose cross-sells loan of the bank itself, now obviously the branch manager point of view, they have spent their time selling a loan instead of raising savings, for example. So we tell them, okay, you raise it, give me a home loan, the assets team will say, okay, take this much money from me. So that's how you pay for a job. Internally done they get paid, externally done they get paid, and that's what makes money. And then the fee income as well.

Superb.

The next question is from the line of Kunal Shah from Citigroup.

So firstly, on the growth side and given that within a short span, we have seen almost 250-odd basis points kind of rise, and all through over last 2.5 years we have grown at a very rapid pace. So first thing maybe on the home loan, do we see any moderation in the prime segments that we operate in? And even in the other product segments, no doubt maybe you have highlighted in terms of the quality of book which we are writing, but just nearly because of the rate increase, inflation, do we see a risk in any of the retail products segments wherein we are growing at this pace?

No, in home loan the issue is never risk at all. I can't say never, never, we're obviously careful, but generally we've not had any delinquency and all. The thing is that in home loan there is...

[Technical Difficulty]

There's very little margin. And if you think of a bank like us, just about starting up the home loan business, cost-income, for example in home loans are pretty high. You might say why, because our book is small. And if you book a home loan today, you probably pay a percent to the DSA or whoever brought you the loan, or even to the branch for that matter, and then you also incur the cost of legal, valuation, technical, all the credit appraisal processors running their shop, doing diligence, all that stuff. All that hits you today when you book the loan, but hereto onward there's no OpEx in a home loan. So that is the reason there is an upfront cost of booking a home loan but annuity income -- it makes money with scale. So for us, we are early stage of our home loan, we're at INR 20,000 crores. So it's not a very profitable business, but it's okay. We are building the bank for generation. So maybe 10 from now, somebody will enjoy this business. Think of HDFC today, their cost-income is nothing. So it doesn't mean it's always like that, because someone built it 1 day, it's what it is today.

Yes. So overall, retail, no concerns with respect to higher credit cost after having grown at this pace over last 2.5, 3 years.

No, no, Kunal, you correct yourself, after running it like for 12 years.

Yes, I was just saying in terms of buildup of the [indiscernible]. Definitely it's been going on all through. But during COVID, so I was just highlighting maybe during this pandemic as well we have grown.

Listen, you've been tracking this business from Capital First times, when it was Capital First, when you were at Edelweiss, then you came to ICICI, now you're at Citi. Have you ever seen our bank having NPA more than 2% ever? Have you ever seen a net NPA more than 1%, marginally 1%, maybe 1%, 1.1%, whatever? Have you ever seen our credit loss being high? This business is fantastic. The way we underwrite it and the way we constantly improve our credit underwriting norms, we've been like 12th year in business, but we still don't let our guard down. Every quarter we still sit and tighten some part of the machinery or the other, so we do that. So we don't think we will drop the standard of 99.5% collection. And if we don't drop that, we will not have an NPA problem. And if we were to have a problem, we'll come to know 12 months in advance because the 99.6% will dip to -- it has to dip to something, if we come to 99%, our risk management committee will see it, our Board will see it, and before them, of course, we will see it, the world will see it next quarter because I'm reporting the numbers, we are putting it every quarter out publicly. If we have a problem, you will come to know much in advance. I guess we'll make sure as management that we don't have any problem on this front. We have our own track records to protect.

Yes, sure. And sorry, I missed your earlier remarks, but any one-off in margins, the reported margins in this quarter?

I think Sudhanshu answered that question.

Yes, 6 point something, 6.3 or something like that.

Okay. Got it. And on PSL position, how is that now? RIDF [indiscernible] coming off every year, but otherwise overall PSL requirement given March end, are we through and there is no drag over there?

Yes, Kunal, so we have given the presentation that we have not been investing any more in RIDF, so that book has been running off. Of course, the proxy to that to meet PSL requirements is PSLC certificates, which a participant can buy from the market. I would say we are doing quite well on this front. In fact, for us, the PSLC drag for the year was just about INR 30-odd crores, right. So we are, I would say, very much there, and we want to ensure that we meet PSL requirements on our own, and that would continue to be our endeavor.

And this INR 30 crores odd compares to how much last year?

It was a much larger number. It was about INR 160 crores in the previous year.

Okay. So INR 130 crores delta on this. Okay, great.

Next question is from the line of Jai Mundhra from ICICI Securities.

Yes. Sir, 2 questions, actually. One is on ROA progression. So if I were to adjust on, Slide 60 of the PPT, adjusted for the one-time item, the ROA would have progressed to 1.23%, which is like 10, 12 basis point increase. If you can talk about the likely progression from here on that would be really helpful.

First of all, I hope you and all members listening today will recall that we have guided for double-digit ROE fourth quarter. And double-digit is 10% and many people I think pretty much the roasted us saying you guys are not going to do it, very hard and all that. But I'm happy to report to all of you, it's not 10%, it's 12%, right? So we are happy about that. Now guidance, yes, we have already guided for, a couple of times ago, I alluded that we will meet our ROE targets, not only targets actually, coming naturally, we're not even having to force things. So we said, if you remember the guidance we gave at the time of merger that we will touch 13% to 15% ROE by FY '25. I'm happy to say that we will touch the upper end of the guidance.

Sure. By '25, right?

Yes. And it won't stop there also, that's how the economics of the bank are. But this is our exit quarter because every quarter it will keep moving in the direction.

Sure. And then, sir, maybe from next quarter, if you can redo the guidance slide, right, because you have already achieved quite a number of parameters in the guidance slide that we had given at the time of the merger. You are already ahead on asset quality and some of the other parameters. Maybe you can put out a new slide for the next maybe 2, 3 years based on current numbers that we are delivering.

Okay. We'll think about it. Yes, let's just close -- we have to meet every 1 of the guidance and that's when we'll feel more happy. So let's get close to it. '25 is still a year away.

Sure. And lastly, sir, if you have the number for slippages in this quarter and maybe for the full year, the gross slippages and the recovery, write off, and upgrades?

I don't have it off hand, but maybe we'll put it out -- it's there somewhere in the presentation. But see, end of the day, what does it translate to credit loss, right, because you may have slippages we have collected. There are some [ natures of ] portfolios which have -- you may have some portfolios which have maybe 1.5% slippage but have lesser collections in the bucket. Some portfolios have 2.5% slippage, but the collection from that bucket is more. So net-net, it all comes back to what is your credit loss. That's it. And as long as we meet guidance of 1.5% credit cost, and we met for the last year, I think we should be okay, but we'll share the numbers.

The next question is from the line of Sonal Minhas from Prescient Capital.

This is Sonal Minhas. Am I audible?

Yes.

Great set of numbers. I've been an investor for last, I guess 3, 3.5 years. I've been looking at...

Thank you. Let me interrupt you and say special thanks to you, because if you've stayed with us for 3 years at a stretch when the numbers were not good, we want to thank you for that.

Sir, just want to add to that. The first chart, the gentleman before who was talking about, I think that was all that we saw as a promise 3 years back. And I think it's really wonderful to see numbers slowly and gradually inching towards what targets and benchmarks I think you put for yourself. So appreciate it again, sir. I have 2 questions, sir. First 1 is around the infra book basically which is being run down slowly and gradually. I think we're retiring close to INR 12,000 crores of that as of FY '24 end. So what will it be most likely be refinanced by? Will it be CASA? Will it be CASA-TD? Just want to get to understand what's the spread we're talking about here that we'll basically be saving.

Think of it, then you replace it with deposits. It could be -- assuming for a minute that you keep our CASA in the zone of the same 45-ish to 50-ish and we'll replace it with deposits. Our mind is sorted on this issue.

Okay. And there'll be enough liquidity of that order in CASA-TD to replace this because this is a large amount, that's why I just wanted to clarify.

No. No, we'll raise it. We'll raise it. We'll do it. No problem.

Got it, sir. And sir, second question, just if you could throw some more light on your credit card business, we're close to 15 lakh, 16 lakh odd cards. At what card number or what matrix does basically the business become breakeven? And secondly, probably little bit more about the competition you see in that business because there are some tech players coming and I think some other larger brands are also doing well. So aspirationally what is your space in that market? And profitability wise, how far are you basically in terms of card count, the kind of target audience you're approaching? So just want to get a sense of that part, please.

On an earlier occasion I think someone else had also asked this question, not today, but 1 of the earlier calls, and at that time we said like 2 million cards I thought we'll breakeven. The thing is that now maybe a better way when we reflect on it internally, we think issue is not is it 2 million or 3 million. Issue is that at a particular book size, the economics start playing in our favor. So our current estimates are very much what we had guided earlier. We had earlier also said that I think twice in 2 conference calls earlier we said that FY '25 we will break even, and we're saying break even, but frankly, our own internal estimates are that we'll be profitable by that time. So think of it in terms of timelines more than in terms of number of cards. And to your second question -- so does that answer the profitability question.

Broadly, that does, yes.

Take '25 and you can hold us to it. I think we'll get there.

Got it.

And that is, actually, 1 of the items that will help us on our overall economics, ROE, what we're guiding for this 15% exit '25, all that will come from there [indiscernible] 1 of the input variables. Now your second question, how we are doing as compared to the others as there are really good players, all the good names, HDFC, ICICI are all wonderful [indiscernible], people are doing wonderful jobs on this front. And, of course, even the other players we talked about. Now, somehow, like I said, we got a really good positioning of our own, of our own meaning that our brand enjoys a certain respect, people call for our card, we don't have any DSAs, but people are requesting for the card, and we are issuing to them. Our spends are pretty good. I don't have the number off hand, unless Sudhanshu remembers. But our spends are really very good, and we offer pretty attractive reward propositions. We make it evergreen, so we don't hurry customers to spend it. We are giving customers even the reward redemption option through online propositions. So there are some really good things. So people who experience the card, they get to see it. So if you don't have 1, please have 1 also. I'll be happy.

I'll definitely do so. Just to follow on. Sir, what it would be...

I hope you're not being polite about this. If you are seriously, you tell us. Someone will...

Sonal, there's 2 data points. On spends, we are almost reaching the spend of about INR 1,800 crores to INR 2,000 crores per month. In fact, it has grown by 90% on a YoY basis. To the earlier question on liabilities, even this last 1 year, we successfully paid about INR 7,500 crores of legacy liabilities. This year we have about INR 5,000 crores odd. We feel we will be comfortably able to meet it.

Got it. Okay, all right, sir. Just wanted to follow on, sir, if I can on the cards. What share of it would be people who are rolling over, if 100 cards are in-force? And what would be transactors who're basically on time? Just trying to like get a broader sense of it.

I think it's like 24-iss, 25-ish percent is of transactors of other banks -- no, sorry, are the revolvers. To the best of our knowledge, many other people in the industry have maybe 30%, 35-odd percent. So like we say, we are a little less than the market, but I see it as an opportunity to improve.

And just to add, in addition, there are people who also opt for EMI conversion. So I think we generally see revolvers and these EMIs put together that number would be slightly more than 50% for us.

Yes, that's the combined number, yes.

That's the combined number, yes. So people also use the card and they take EMIs on -- they convert their spends basically. That's not called revolvers. They are people who converted to EMI, so we do that also. These things always catch up, build over time. And again, we're only 2 years, since '21, 2.5 years. So we have a lot of scope...

No, I agree. I think there is enough headroom and it's a high-cost business. And I think your tech stack is little better than a lot of people in the market I've been observing. So I think that's the additional advantage you as a company have. Maybe it's a newer tech stack that's why I guess.

I don't know, there are many good players. But the thing is that, like I said, we are new, so our performance may be a bit under par today in terms of revolver and all that, but really, I'm not telling you just not like a statement for the heck of it. I'm telling you, really we're treating customers differently. For example, we're not trying to -- I'll give you an example. For example, if customers went over a limit and somebody has a limit of INR 1,00,000 and suppose customer is at INR 90,000, if the customer went over a limit and spends for INR 1,02,000 banks make lot of fees out of that. Oh, you went over, pay me INR 500 or INR 400 whatever. We are texting customers in that example to say, okay, man, you reached INR 80,000. I'm texting you don't spend any more. If you spend it, really, you will go over the limit.

Yes. No, there a lot of [indiscernible] there for making money.

No, but we don't use -- I think we try not to use [indiscernible]. We're actually reaching customers and trying to keep the customer interest in mind and try to say that, listen -- of course, if a customer chooses beyond our reminders to go and spend it over the limit and pay us fees, well, thank you. But we are doing our bit to really run this bank in a way where it's truly customer friendly. These are small, small things. Many things like this we do.

Due to time constraints, this was the last question for today. I now hand the conference over to management for closing remarks.

Yes. Thank you, everyone. I know it's late in the day, but thank you for your patient hearing and thank you for the valuable questions which came across.

And also thank you for the 3 years for being with us. This is FY '23, so you've been with us since 4 years now. I think many of you may have felt that everything is fine, but damn the result is not showing, ROE is not showing, ROE is not showing, cost-income. Just watch the next -- I feel that has set a stage - it was like that because we had to set up the bank. There was no other way of doing it actually. We didn't know. But from now on we believe that the numbers will show and you will get more confidence if you see us for 3, 4 more quarters. Thank you, everybody.

Thank you very much. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us and you may now disconnect your lines.