Indian Bank (INDIANB) Earnings Call Transcript & Summary

Welcome, everyone, to Indian Bank Third Quarter FY '22 Earnings Call. We have with us today Mr. S. L. Jain, who is the MD and CEO of Indian Bank, along with him, the top management is also there, including Mr. Shenoy, the Executive Director; Mr. Imran Siddiqui, Executive Director and Mr. Ashwani Kumar. First would request MD sir to brief on the key highlights of the third quarter FY '22 results and then provide the near-term to long-term outlook on the bank as such, post which we can do Q&A session. Over to the MD, sir.

Yes. Good evening, and welcome to all analysts and investors in our Q3 FY '20 earnings call. So first, I'll give the highlights of the last quarter. First is our operating profit has grown by 16% on a Y-o-Y basis to INR 3,288 crores from INR 2,846 crores, so for all operating profit. Our net profit has grown by 34% Y-o-Y to INR 690 crores from INR 514 crores. Our NII, net interest income has grown by 2% on Y-o-Y to INR 4,395 crores. As you know, on the December 20, there was a Supreme Court decision -- stay for declaring any account is NPA, and therefore, our income was booked in to -- and the provision was met. Sequentially, on a Q-o-Q basis, our NII has grown by 8%. And our cost of deposit has come down on yield on advances has increased, yield on investment has increased resulting improvement in our NIM from 2.89% of September to 3.03% in December. Likewise, in addition to increase in NII, there's a note there is a growth in non-interest income by 36% on a Y-o-o-Y basis. This is supported by a growth in fee income by 11%, growth in ForEx income by 32%, PSLC by 47%, recovery in bad debt 111% and operating expenses remained more or less subjected with an increase of around 2%. So our operating profit and net profit growth is based on growth in NII as well as growth in other income. As far as business is concerned, our business has grown by 6% and reach to INR 9.63 lakh crores in December as against INR 9.10 lakh crores in December 20. On a sequential basis, we have grown by 3%. So unrealized it is 12%. In our deposits, the total deposit has grown by 8%. This 8% has grown on the back of 10% low in CASA. So our saving deposit has grown by 9% and current by 15%. As a result, our CASA ratio has improved by 80 bps to around 41% to around 42%. Likewise, advances have grown by 3% from INR 389,000 crores to INR 4 lakh crores on a Y-o-Y, but sequentially, it has grown by 4%. And our RAM sector is growing 11%, and our RAM has reached to 61%. So RAM -- basically retail is growing by 13%, housing has grown by 11%, personal loan by 36%, Jewel loan by 43%, auto loan by 6% or other retail by 11%. So our retail Indian is growing at 13%. For Agriculture too, is growing at a rate of 14%. The Agriculture has grown on the back of Jewel loan, which is growing at 24%. So 13% Agriculture is increasing on the back of 24% Jewel loan where NPA is even 0.2% or so. And investment credit is grown by 30%. Agri allied by 72%. And whether it's SSG we are growing 16% with NPAs are less. So MSME is growing at 6%. As far as GNPA, GNPA has come down from 9.56% to 9.13%. That is a reproduction of bps on a Q-o-Q basis and NNPA has come down from 3.26% to 2.72%, and that is a 54 bps. Our PCR has improved from 83.32% to 85.49% so around 200 bps. Our cash recovery was higher at INR 1,096 crores, as against INR 744 in December and OCA recovery is INR 278 crores against INR 129 crores of the previous system. So both sides, there is a good progress. Our capital adequacy rate is 15.47%. Of course, this has come down from 15.88% because of the growth in -- mainly because of the growth in credit and there are INR 200 crores of Tier II bonds has gone for rediscounting. If you add a profit of the 9 months, it has increased by around 1 bp more so is again 15.47%, it is around that 16.45% or so. So this is the crust. And as far as our growth is concerned -- yes, our digital transactions are increasing net banking, 25%, 26%, mobile banking 25%, 26%. And even that 40% UPRE. And as a result, [indiscernible] overall digital transactions has increased by 64% to 76%. And our gross of -- cost to income ratio has again come down to 43%. And we are focusing on more and more digitization. We have recently started our tablet banking or we are -- we plan to open majority of the accounts to tablet. It will be easier for us to access the customers. We are also working with our technology partner for digitization of various journeys, the personal loan, housing auto loans, all we are working on that. And as far as growth for the full financial year is concerned, we are expecting that we will be in the range of 8% to 10% of the growth. The way we are going -- in the last 9 months, we have mentioned around INR 48,000 crores of a proposal which as last quarter is around INR 22,000 crores of the proposal and majority of the proposals are in term loan and so what happens, the slowly, slowly the disbursement will start and deliver good growth in the current quarter as well as in the time to come. So this is my initial remarks. Now we are open to question answers.

Before we start, I think people will have questions around what's the broad outlook on growth because that has been relatively weaker when we compare it with the other banks. I agree not making there is a corporate drag but your comments on that will be welcome.

So I told you will -- the year as a whole, we will grow between 8% to 10%. Of course, you are seeing that it is a 3% growth in a -- on a Y-o-Y basis. But you see the growth of Indian Bank of the last year, December '20 to March '21, vis-a-vis this quarter. So there's a good growth here, and we are hopeful that we'll be achieving this number. This is based on the corporate pensions we are having in it and the way we are growing in the retail system, retail 13%, 14% retail and Agri both are to it.

Sure. But if you look at the 10% growth, like we are talking about almost 7% to 8% kind of a quarter-on-quarter growth. That looks very high. So is that the right number that we're looking at?

You see, last time, we have grown -- last quarter, we have grade -- corporate credit we have around INR 3,000 crores. And you see bond also in investment also around INR 2,000 crores or INR 3,000 of crores. So keeping -- considering the proposals in hand and the sensors, we are hopeful that we will be able to achieve 8% to 10% growth.

Sure. Now I think we can start with the Q&A session, sir. Mr. Ajay Mehra, I think you are the first in the line.

Congratulations to you, Jain, [indiscernible] set up numbers. The bank is really doing well in the last 2, 3 quarters, especially this quarter have been very, very good on all the fronts. But yes, as the -- as Anand said, about little tension on the credit growth side. So you have broadly said that it is 8% to 10%. But when we have that this pipeline -- you see generally the proposals which are coming out from infra, NBFC, metal and food processing and other things. Can we know that in your kind of other industries you are seeing green shoots. And how are you going to match this higher credit only in this current quarter from January to March? And are you open for NBFC's A-rated plus for onward lending, whole lending, what is the road map for that? So my first question is basically on a little more in detail minutely on the credit side growth of the bank.

So sir, we are getting proposals from all sectors, which you grow 10 projects or a textile or a cement or a [indiscernible] chemical or steel. So all these sectors, we are getting proposals. So in addition to that, we talked about the coal lending, we have had an agreement with the 7 companies. So we have started discussing coal and -- coal lending as well. So we are growing in all and all sectors of proposals are there and we are open for everything.

Okay, sir. Having this answer on that. On the -- sir, we are seeing the pressure on the treasury income everywhere. I mean whether you take it the treasury interest, of course, interest rates going up a little bit. It will offset by the interest on the investment book. But the profitability is going down because of the hardening of the interest rates. So to reserve your profit or to grow your profit, are you totally looking at the credit side or even the noncredit income, like recovery from the return of accounts, on the fee front. So say, for example, I mean, how much the operating kind of operating profit we are expecting during this quarter or for the full year?

It is very difficult to say in number terms, growth in operating, but it's very difficult to say. But you said about the treasury income as the field is hardening. So this is basically a balance between your interest income on a trading profit, right? So you see in a quarter-on-quarter basis, INR 500-odd crores of the trading profit we had in September as against INR 200 crore. But what we have done -- we have reached our -- churned over other portfolio in investments. So -- but we were having around INR 22,000 crores of a principal outstanding because we were hoping that interest -- it will harden. Recently, but we have shifted some of this outstanding into HTM and AFS book. And basically, this is a high earning. So if I see my contribution of treasury -- of third quarter vis-a-vis second quarter, we are more or less at par. So going forward, also we were hitting the interest income -- more of interest income from the treasury. So that will take care of any MDA losses.

My last question is, sir, on the recovery front. Number one is that the exposure, the national recovery infrastructure to the NARCL now has already become fully operational. In this quarter, they will take some account. So out of the INR 50,000 crores in the first range, how much is yours in that? And on the NCLT front, how much are already approved recovery cases? And what is there in the pipeline, which we can see in this quarter in the coming quarter from the NCLT and some of the OTS and non-NCLT recovery track, if you can give, sir?

What happens, initially 34 accounts have been identified to be transferred to NARCL. And in the first phase, 8 accounts of around 1900 [indiscernible] and RCM. What happened is 3 accounts, the resolution has come. So now the 5 accounts amounting to INR 1,200 crores will be transferred to NARCL first trench. And the second trench around 9 account of INR 1,300 crore will be transferred. So in all 34 accounts, it has been identified amounting to INR 5,500 crores to be transferred to NARCL. And as far as NCLT, NCLT is concerned as last time, we have a recovery of around INR 229 crores in the last quarter. So we are hopeful that this quarter also, we will be getting more recovery than this.

Next question we have from Mona Khetan.

So My first question is on the restructured book. So of this INR 20,000 crores of restructured book, how much you would have completed the moratorium period, if you could give some sense? And what sort of slippages do you expect over the medium term from this book?

We see our restructuring book, which is around INR 20,000 crores, right? In INR 20,000, INR 8,000 crores is retail, around INR 8,000 crores is SME, INR 16,000, INR -- 3,000 crores is in corporate and INR 1,000 crores in Agri. So a little bit stasis seen only in the MSME sector. Suppose, we are going through the ECLGS limits and all. But so far, around 3% of accounts is been stripped from that. So we are not worried on account of this, the time.

Okay. And how much would have, say, of this 20,000 book, how much would I say, completed moratorium so far?

So basically, we got 1 into maximum 24 months time we have given to these accounts, but we are not monitoring that way, but we are monitoring based on the SMA 0, 1.

Okay. Okay. So despite the moratorium across these accounts, there are still in stripping.

Yes, some of the accounts where the moratorium carries is over on interest recovery is not happening, we'll see that.

Okay. Okay. Sure. And secondly, on this corporate slippages were about INR 955 crores this quarter. So if you could give some color as to where it came from?

So out of INR 956 to account of around INR 400 crores, INR 400 crores, INR 385 crores is basically the 2 accounts, which were NPA in the previous year, but because of the court order, they were classified as standard assets. So which we were disclosing all along in our quarterly results of the 2 accounts Power Gen and the Delhi [indiscernible]. In these accounts since the stay has been bucketed is classified as NPA. The other half of this is -- this on account of the Jateswar government, we are expecting recovery very soon it will come. And third account is basically -- forth account is basically a road project of INR 70 crores where the termination payment will be we'll be receiving from [indiscernible].

Sure. And what sort of provisions do we hold against Srei Infra as of now? It was about 53% last year.

[indiscernible], we are 100% provision gathering.

Okay. Okay. So that was the main reason....

For this quarter, we have fully provided this.

Okay. Okay. Got it. And any exposure we have to the large retail chain?

Large retail, yes, we are having some exposure.

Okay. If you could share the quantum?

It May be around INR 900 crores.

Okay. And how much have you provided against it?

Around 15% or so we are -- as per the RBI guidance.

Sure. And just finally on the tax rate. So -- what sort of tax rate can we expect going forward? Because I think the guidance was around because of the accumulated losses that we continue to see reversals. But this time, I think it was some foreign branch related expense. So what sort of tax rate can we expect?

Well, our tax rate is -- continue to remain the same, what happens we have provided for certain liabilities. Of course, there is no cash out on account of this. These are the liabilities which are distributed. So we thought let us provide for that.

Okay. So once again, from next quarter, should we continue to see tax reversals on account of the last year?

Yes, right, right. This quarter, basically, we have made a full provision of sales.

Next question we have from Deepak. Please go ahead.

Sir, I just wanted to understand that in the previous call as well, we have spoken about credit cost of about 2% this year. And but already 9 months, I think we are at about 2.6%. So how do you want to see the outlook? Or are we revising our FY '20?

But see, what is our credit cost. Our credit cost is around 2.33%, right? So if you exclude the one biggest account where we have made 100% provisions. And these 2 accounts where we were already having this provision and lying in the standard of it. So if you net up these 2 items, it is around 1.6%, 1.65%. So barring these 2, we are still building that.

Okay. Okay. And as since you mentioned that one of these large accounts you've already fully provided. So over a year, they already is fully provided. So going forward from fourth quarter, do we expect this credit cost to normalize?

Yes. Credit cost will normalize.

Normalizing for a 2%, I mean 1.5%?

So it is very difficult to put numbers on the it but it should normalize.

Okay. Okay. And effort credit cost of below 2%, right? So we are on that?

Sir, I think he asked that basically whether a net credit -- I mean, your credit cost will remain below 2%?

It is very difficult to put numbers, but you say that 2.33% is our cost is. And if you exclude this number, it is 1.65%. And we are not met adding much of SMA 1 and SMA 2. So credit of course would come down.

Next question, we have from Gaurav.

So what I was asking is there are 3 categories of restructured accounts, so OTR-1, OTR-2 and then MSME related restructuring. -- put together, it is around INR 25,600 crores. Sir, net of overlaps between these 3 categories, what will be the ......

Yes, It is 25,000. If you are on you've added COVID 1, COVID 2 and MSME. MSME, majority of the accounts where we have restructured is already under stress. So there's a continuous stress on that. So majority of this MSME has been restructured in COVID 1 or COVID 2. So major part of it is over rated.

Okay. And sir, Air India, do we have exposure to Air India? And if yes, what is its status? Is it part of your SMA?

Air India, we have an exposure of around INR 225 crores, which has been fully repaid.

Okay. Sorry, INR 225 crores?

Yes, an amount is already gone.

And the future group?

Future group. Expose of INR 900 crores, yearend we are hitting 15% of it.

INR 500 crores, is it?

INR 900 crores.

Okay, INR 900 crores.

Next question we have from Rishikesh.

Okay. Sir, my first question is that I need to know like how much your carryforward losses are yet to reverse?

So carryforward losses are still there and we will review our position on 31st March '22. So it will be available for next quarter as well.

Okay. Okay. And sir, what loan book growth are we expecting for next year?

I told you that we're expecting around 8% to 10% of the loan growth in the current financial year. And next year similar trends would continue.

Okay, sure. And sir, fair to say our credit cost should be like much below 2% for FY '23?

Yes, keeping considering the 2 and this time, the large provision of this one account and some of -- and these 2 accounts, which were appreciably in a standard account. So next year or rates should come down so significantly.

Next question we have from Mr. Sushil Yes, please go ahead, sir.

Congratulations Jain for the stable numbers. I have 1 or 2 questions on the outlook. One is post this NARCL movement, how do you see your gross NPA and net NPA numbers?

Over gross NPA, which has come down from 9.56% to 9.13% right? And we are not seeing much of a problem in corporate book. And you see on agree there reserved part is covered by the Jewel loan. Likewise, in the Retail also, there is so much worry. So our gross NPA should continuously come down quarter after quarter which I think, I see.

How much of bad assets are we transferring to new assets with ARC. That's what I asked.

We are transferring around INR 1,200 crores of bad asset in Phase I. In Phase II, again, INR 1,300 crores. But you see this will keep on going because we are already decided INR 5,500 crores.

Now on digitization and what kind of initiatives have you taken which should benefit the Indian's talent of South India, specifically on that?

Right, sir? So what we have done in digitization, in liability side, we already launched our tablet banking and accounts started opening. So presently, we are opening [indiscernible] shortly we will open the current account -- so this is one part. In the lending side, we are 3, 4 things we have done. We have business intelligence units. So based on the account bearer, we are generating lease on daily basis and we these leads we are giving to our bids for mobilization of business. So this is one answer, we are capturing these retail accounts even MSME account. And even the agri account side that is one part. Second part is on our digitization. We want to do a number of journeys on digital. So that is why we came out with RFP and selected decision partner. And we now with our team is working from last, say, 15, 20 days. And we hope that in the first quarter, end of the first quarter will come out with our various products. And these all to come out in mobile. Of course digitization, though, our numbers are increasing but will further increase with these 2 initiatives, liability side will be taken care by the tablet and the lending side will be taken by these journeys. So we hope that there will be significant growth after June.

How much book have we created in co-lending so far?

So not much we have sanctioned around INR 500 crore of loan and the disbursement so far is around INR 200-odd crores.

This would be more than housing and gold loans or some other loans?

Must be housing loans. And now we have signed with the 7 companies that started picking up strategy.

Okay. What would you be forecasting over a period of time, how the partnership or what kind of AUM you'll achieve to all earning.

We have signed the 7 companies that we are open for other companies as well, slowly, slowly. So we will be growing, the momentum just started. So we have to understand slowly, slowly, maybe by the end of this quarter, we'll be able to tell you how we will go.

So if I have to see CASA number and Indian bank with a 1- or 2-year outlook, where would you figure out where we stand in percentage term 42%, 43% or more?

So you see in the 1 year, we have moved from 41% to 42%. And that is why we came out with the digital products. So we want to grow from 42% to 44% or 45% in 1.5 years' time. We have to grow it slowly, slowly. Maybe 2% in the year or so.

Sir, in your part of Southern India, auto, ancillaries and textile and related businesses like Forging and others are doing very well. Are we seeing any traction from the industry, which are predominantly majors coming out of Tamil Nadu and adjoining states?

We are getting proposals from all companies the textiles, right excited, we are getting the steel, we are getting from the cement companies. So we are getting proposals from our part -- in this part rather than in addition to this part from other parts as well. And you see we have sanctioned our INR 44,000 crores.

So you have unavailed credit of how much -- what is ...

Out of this recently sanctioned around INR 46,000 crore we have 16,000 is disbursed. So huge amount is line undisbursed. In addition to that, working capital utilization is around 70%. So there also is a scope.

So you are expecting a double-digit growth by March based on the current?

No, we are expecting around 8% to 10%.

That is on an annualized basis you are saying, right.

Over a Y-o-Y basis.

On quarter-on-quarter?

Quarter-on-quarter, which is -- we are at 3%. So that all will be growing more in this quarter. So that way, the percentage will be higher.

Next question, we have again from Gaurav.

Sir, I wanted to reclarify the restructured numbers. So MSME restructure is around INR 5,200 crores. right? And OTR 1 is INR 4,500 crore, and then OTR 2 is INR 15,800 crores. Sir, if you could please, in absolute terms clarify what is the net restructure number? And what is the overlap with the MSME restructure number?

I told you the MSME restructuring is close to INR 8,000 crores, right? So you see all the slides also there are INR 6,800 plus INR 1,300, add what sums to be INR 8,100 crores. And as far as overlapping is concerned, is -- we have done the restructuring of the accounts which were understand. And with COVID, the state is continuing some weather part of our restructuring, MSME in earlier guidelines in the part of COVID 1 or 2 restructuring.

Okay. Sir, MSME restructuring is INR 8,000 crores or INR 5200 crores? In you are filing it is INR 5284 crores, I think.

Which one?

MSME GST related restructuring.

No, which one? Total restructuring is INR 30,000 crores.

No, sir, I'm not referring to total. I'm referring to MSME GST-rated restructuring, which you have given on Page #7 of your financial filings, there's amount of ...

Yes. That is basically not so -- point number?

10.

Yes, yes. This is basically a restructuring and disclose as per the guidelines. So INR 5,000 crores of restructure we have done. So this is based on those guidelines. But out of this INR 5,000 will under the COVID 2.

But sir, you said INR 8,000 crore number.

This 8,000 includes this INR 5,000 weather part of the.

But sir, I know what I'm getting is where are you getting this INR 8,000 crore number from? Because OTR-1 is INR 4,500 crores. So OTR_2 is INR 15,800 crores. And then the number which I just mentioned in restructuring, it is around INR 6200 crores. So I'm not ...

Just a minute. There's a number of account and there amount, right? So MSME restructuring is INR 1,300 crores -- and MSME restructuring at COVID is INR 6800 crores. So INR 1,300 crores plus INR 6,800 crores, INR 8,100 crores.

INR 7,300 crores.

8,100. INR 6,800 crores plus INR 1300 crores.

INR 6,800. So you are saying the INR 6,000 crore -- INR 81 crores, includes INR 6200 crore of that.

Right. Whether part of this, right we are now.

Okay. And sir, just one more clarification on data is you disclosed very nicely SMA 1 and SMA 2 on the entire book. So ...

Yes, we have disclosed entire, but you see the corporate only 0.44%.

Yes, sir, yes, so. That's very good, very commendable. Sir, can you bifurcate this into further what would be below INR 5 crores and what will be above INR 5 crores because most of the banks don't give above INR 5 crores.

Yes, I agree with this. So most of the banks are giving above INR 5 crores. Above INR 5 crores is mostly corporate, right? So my corporate is 0.44% only.

So sir, is it fair as in this retail MSME and agriculture, all of this would be below INR 5 crores in closure-wise? There will be no account from these 3 categories RAM categories?

Sir, just a minute. So otherwise, we'll give you the exact number. So it should -- it cannot be a major difference from a maybe slight bit it will be added because you're right, some of that MSME may be there for more than INR 5 crores. Retail cannot be happened some MSME -- it can be materially different. Cannot be materially.

Sure, sir. And sir, what would be the overlap between your SMA number, which is INR 13,000 crores and the restructured number of INR 20,300 crores, which is OTR-1 and OTR-2?

Again, there is an over lap. Again, this is because SMA 1 and SMA 2 will remain from -- whether it is from the restructured or [indiscernible].

Sir, what would be that overlap because ...

So that number -- overlapping number will be provided. But majority of this SMA 1 and 2 will come out of the restructuring work.

Majority of SMA 2 will be from restructure.

Exact number we'll provide, sir, right?

Our next question will take it from Mona. Mona, go ahead.

Just one additional clarification. On the ECLGS book, what is our current outstanding? And how much was the disbursement in this quarter?

Yes. ECLGS table, we have sanctioned around INR 9,885 crores. And we were close INR 9,165 crores, and the balance outstanding is INR 8,768 crores. So disbursement is INR 9,165 crores and outstanding INR 8,768 crores. And last quarter, we have disbursed INR 2,630 crores.

Okay. And what is the difference between total cumulative disbursements versus the outstanding? Is it like ...

Some of the money has come because of the top -- some of the accounts have been closed.

So before we take the next question, we have one question which has come in the chat, and that is, if you can highlight of your overall loan book, what percentage of loans will be on EBLR, which is basically the external benchmark. And if you can break it down into the table link rate, loans or basically to the MCLR-linked loans reporting loans? That would be great to have.

Then we'll provide you. Meantime let us take a second question, let me [indiscernible].

Yes, sure. And sir, basically, another question which was there is that if you look at during the current quarter also, we had very high retail of about more than INR 600-odd crores. So these retail slippages are primarily coming into the housing loan segment because if you look at our retail book, it's largely built up of mortgages.

Out of the INR 600 crores, INR 250 crores is basically education loan, whether slippage has come from the education loan. And whether education loan is towards the engineering colleges, you saw in South, number of education engineering colleges are there. So because of the unemployment or underemployment, or place that is not taking place. Maybe this is the reason that is why this slip has come. But you see our chart for slippage and loans, if you see our 9 months slippage, we put together vis-a-vis quarterly slippage, what happens against INR 8,000 crores, we are having INR 8,000 crores is there. If you put together quarter-on-quarter, it is INR 10,000 crores in 9 months, INR 8,000 crores. This shows that INR 2,000 crores amount we have recovered. So if you see the first 2 quarter slippage, INR 8,000 crores. Out of INR 8,000 crores, we have recovered INR 2,000 crores. So 35% of the recovery takes place in the next quarter. These are small loans-- small, small loans. So because of the 90 days over sleep and it is recovered the small, small loans.

Sure, sir. Because I think education loan has been a primary problem for us right from 2007, 2008 when that postcard scheme was there.

But in our small accounts, the upgradation is compulsory. So external benchmark basically what happens, all our retail and MSME loans are based on the reposing. This is as per the RBI guideline, right? So all retail, all MSME, this all put together out of 42% is basically in IBL. Because as per guideline, you cannot have all NCL loans at once.

But sir, basically, how much of these like will be floating rate loans. So what basically we wanted to understand here is that as the rate actually does goes up -- that is what you expected over the next 12 months. And how much of your loans will get repriced automatically?

So automatically, APR, the repo rate increases in this. So all retail and automatically price.

What will be the non -- an EBLR book, nonrepublic.

That is MCLR book? 42% is basically EBLR, 48% is MCLR.

Okay. And T-bill will be part of the MCLR?

We don't know that.

Sir, why is that, sir, because a lot of banks are now moving towards T-bill because that is a rate which is moving faster?

Yes. Optional benchmark, you can get linked to the T-bill or you can link with a repo us. But it is like not with MCLR. So if we link with the repoint -- link with the 4% or stabilities. So that's not different this 2, to my mind.

Yes. But if you look at repo, is not increasing but the T-bill has inched up by about almost 40 basis points.

Okay.

Next question, sir, we'll take it from Jai.

Sir, first question is if I look at our restructured book and now that the scheme has mostly ended and if I compare versus other banks, our restructuring number is as a percentage of loans at around 6% is really higher than any other bank. Most of the other banks are at around 3% odd. Can you comment, sir, what is leading -- what has led to such high number of restructuring at our bank?

So you see INR 20,000 crores and the INR 4 lakh crore book, which is around 5%. It is around 5%. And ours is high because of INR 8,000 crore MSME and INR 8,000 retail. So retail, we are not seeing much of an issue. MSME book is an issue where we are given ECLGS and this. Otherwise, the corporate only INR 3,000 crores restructuring I think more than the only account, which everybody has done. So ours is higher maybe because of retail book.

Yes. So sir, within retail, have you come across any anecdotal commentary or evidence to suggest that why retail restructuring in Indian Bank is higher? Because that is not the trend that we have seen at other banks.

Yes, but retail see we too have given the application, the shifting of this account to NPA. So you see that in NPAs they are not. So we are getting recovery there in retail have done restructuring but we are getting on. So ours is higher in retail because of this housing loan and on. But here also, we are meeting it. So the slippage, you can see the slippage on the restructuring book, it is basically in there.

Understood. Okay. And sir, secondly, if you can comment on FY '23 recovery and upgrades basis the situation today, what kind of a recovery upgrade one can expect for '23 as a whole?

FY '22, '23 but happens as against the INR 2,600 crores of recovery in 9 months ended FY '21, we have INR 6,500 crores of recovery in the last year. And this is when we are having INR 36,000 plus INR 26,000 -- INR 34,000 or INR 70,000 crores of NPA book. So we are expecting a similar trend of recovery in the next year to the way we are recovering this year.

And because this year, of course, there was Dewan recovery. There was one other lumpy cases. Is there ...

Dewan is a lumpy case, but all we are having INR 23,000 crores. So one or the others, always comes one of the other account always comes and we are having 100% provision there against. Then such as INR 34,000 crores PW book, you are always have good recovery.

Right. Okay. And sir, on this large retail chain, which is Indus first, what is the total export? I think you had mentioned INR 900 crores, but does that include bond and maybe NSB because if that were to slip, probably -- is that ...

Total is agent rate, and we are having 50% of this.

That is the total exposure, right, including bond NFT, everything?

Yes.

Okay, sure. And sir, lastly, on our Slide 16, just a question to CFO, sir also. I mean what are we following in terms of RBI that MTM depreciation -- is that now a negative line item in other income? Or where is it going? So Slide 16 of the presentation, which ...

It is a negative line item.

Right. And sir, this quarter, if I see actually a positive line item, INR 31 crores.

So there is a right business and there is a right way.

Despite the yields going up, right?

Yes, that is right.

Okay. Okay. And the last question, sir, we have done accelerated provisions in this quarter, and hence, our PCR has also moved up -- if you can -- if you have a broadcast number that what was the IRAC mandated provisions? And what was the accelerated provisions that we did? I mean, that will help us understand that -- I mean, whatever proportion is from accelerated provisioning based?

No, we are not doing accelerated process on all accounts. We are basically doing provisions based on the IRAC and always take a conservative stand. So in saying, we are, of course, having 100% vision.

[Operator Instructions] So before that, we have 1 question in the chat box, what is our secure book? And how much is the provision that we're carrying on that book?

This is -- As far you're talking about, FSR?

Yes. Yes, sir.

So around 3,396 or some odd were there. And we are having growth of close to 100% -- 96%, 97%. We are hitting 3,000-something. We has disclosed also. 3,349 we are at close to 96% to 97%. So -- 97.29%.

Okay. Okay. And we have done some additional provisions during the current quarter, sir?

No, in this, we are already having time as well.

[Operator Instructions] I think one more question which has come in the chat box shipments may have credit cost outlook for next fiscal year and any aging-related provision we need to provide possibly next year. So I think we have already talked about the credit cost outlook, which is going to be less than 2%, right? I think that is the answer to the question.

Yes.

And any aging-related progress that you expect to be made next year?

No, you see our net NPA only INR 10,000 crores. So I won't give you the provision.

Okay. Sure. Sir, lastly, from my side, basically, I just wanted to understand what is our margin outlook? Because now that we were talking about the Vela linked loans, how much is to the repo, rate and stuff. So how do we see our margins going forward? Because I understand that we will grow faster, possibly next year. That is the hope but even a cost tend to go up. So how are you looking at the margins going forward, sir?

Our margin, we see across this quarter, it has increased, but it goes -- was around 2.75% to 3%. So we will in this and answer to the next year.

Okay. And sir, beyond future retail, which possibly might slip next quarter. Any other lumpy corporate account where you expect possibly it might slip in next 1 or 2 quarters or so?

Sir, 0.4% is at 2. So to be worrying that way.

Sir, I mean, it might just take one quarter for the ledge book just blow it up. Some way accounts may just come in that we don't know. There are some state government accounts which are under stress. That is what some other banks as actually talking about..

It's in a corporate book, we are not taking a lump accounts.

[Operator Instructions] Yes, Gaurav, you have a follow-up question. Yes, please go ahead.

Can you give me your cat cost has been running at INR 2,500 crores odd for 2,3 quarters. Can you guide a bit how do you see this based on your INR 18 crores program?

So sir, I told you about our credit growth, which is 2.33% and because of these 2 or 3 accounts. Otherwise, net of this, we accounted 1.6% gross.

So in absolute terms, what is the depth, lumpy account provision what the amount of [indiscernible] that you would have done?

Yes, that is what I'm telling you. It is 2.33% by credit cost side. So if you exclude additional provisioning or the 3 account which were NPA because of [indiscernible] not NPA, but the provision was lying in the standard asset . And it has moved from 7 to NPA provision, resulting into an increase in the credit cost. So if you exclude this, it just is 1.65%, sir.

So it's around INR 800 crores for this quarter, the account related to ...

Yes, it is around INR 900 crores. How much? Close to INR 900 crores.

So can we assume from Q4 your provisions will be like INR 1,500 crores, INR 1,600 crores cash?

So numbers, it is very difficult to set in numbers.

Broad range, I'm not asking ...

This should come down, should come down.

Pre-provision profit?

You see our NII growth, right? And the way we are growing in the last quarter versus this quarter, right? And now we are going for this quarter. So the NII will grow. And you see investment also my spread has increased because I shifted part of the securities from the team to that. So it is giving me more interest income. So my spread will increase. expenditures are under control, right? And our other income is increasing and with the first ever recovery in write-off because we are expecting a recovery in NCLT in other cases and the another compromises, which we have met. So going forward number should be good.

Sir, we do not have any further questions. I think we can wind up the call. I would like to thank you on behalf of Emkay Global for providing us an opportunity to host the call. Do you have any closing remarks?

Thank you all the investors and analysts for [indiscernible] Indian bank in the [indiscernible].

Thank you.