Punjab & Sind Bank (533295) Earnings Call Transcript & Summary

Good evening, ladies and gentlemen. I'm Mamta Samat, moderator of -- for today's Investor Meeting. On behalf of the [indiscernible] creative IR NPR, I welcome and thank each one of you for joining us today for the Punjab & Sind Bank's Q4 and FY '23 Analyst Meeting. Today, we have with us the senior management represented by Shri Swarup Kumar Saha, Managing Director and Chief Executive Officer; Shri K. V. Raghavendra, Executive Director; Dr. Ramjass Yadav, Executive Director; and Ms. Mahima Agarwal, Chief Financial Officer. The management will first give their opening remarks and then share the highlights of financial numbers reported in Q4 FY '23 and annual year FY '23. I would now like to hand over the conference to Shri Swarup Kumar Saha, MD and CEO of Punjab & Sind Bank for the opening remarks. Over to you, sir.

[indiscernible] So good evening, everybody, and welcome to this analysts meet in Bombay post declaration of the results of Punjab & Sind Bank of March quarter and financial year '22, '23. I'm very grateful to all of you who have spared their valuable time to be present with us today in this hall here and understand and interact on our results of Q4. The results were declared on May 2. And I think post the results, the presentation, the stock exchange declarations are all with you. But just to set the context of today's discussion and the analyst meet, I'd like to just go through a few of the highlights of the -- of our results so that we get in the context of the direction. As you all know that the March '21, '22 was a turnaround year for the bank, wherein we registered a profit of INR 1,039 crores of net profit. And we had given guidance to the market, to all of you, that we'll try to maintain the overall profitability of '21 and '22. And we -- at the end of it, at the end of March 24, we were able to finish with some good numbers. Our advance grew by 15.05%. Deposit grew by 7.37%. The business mix around was 10%. Growth mix [indiscernible] operating profit increased by 69% [indiscernible] return on asset was 1.33% [indiscernible] negative recovery of to [indiscernible]. As for the guidance, [indiscernible] it is over a number for us [indiscernible] significant improvement of 49%. The capital adequacy ratio was at 17.10%. So we are well capitalized also. On a financial year, as I said, that we were able to maintain the profitability. In fact, we grew by 26% in net profits. Operating profit grew by 9%. The return on equity was at 176 bps. And one of the pain point of the bank regarding cost-to-income ratio, we were able to reduce it on a year-on-year basis to 62.95%. And on a quarter basis, also [was] significantly improved. The business mix, which we have already talked about, the CASA deposits increased by 6.68% as the deposit of -- total deposit growth of 7.37%. In the loan book, we feel that our diversification continues and the percentage of RAM growth increased from 50.71% to 53.20% on a Y-o-Y basis, primarily driven by RAM growth of 20% plus. The corporate lending has also started. Now we are at 9.24% [and] growth. These are some from the numbers on the retail segments. The advances break up. These are infrastructure, we are at 19.14%. You must have all gone through this breakup. The important profile of NBFCs, what we'd like to highlight here is that total A and above portfolio of NBFCs is at 99.53%. That is nearly 100% of the portfolio is A and above with a triple-edited portfolio of about 58.4% of the total portfolio of 13,312. The credit profile of the bank has improved significantly here also, both on quarter-on-quarter and Y-o-Y basis. The BBB and above now composes of 56.72%. And if you see the migration of the AAA rated accounts, it has moved from 23.13% to 26.27%. The asset quality, we are all aware of the PCR has improved from 87.89% to 89.06%. From the segmental NPA, we find that on a Y-o-Y basis, our retail NPS significantly moved down but still a bit high. We need to work on that. 2.91% is not a very significantly improved figure. But still, if I look into the progress trajectory, the retail has gone down, our NPA has gone down by 5.09% to 2.99 -- 2.91%. Agri is okay, more as in industry standards, MSME also at 9.70% with a corporate book at 7.13%. The interesting fact is that on a quarter 4 basis also, we had a INR 1,153 crores of [indiscernible] of [indiscernible]. And that is significantly improved from sequentially and on a Y-o-Y basis. The slippage ratio is at 0.63. Credit cost is negative. SMA 1 and 2 above of INR 5 crores has moved down from INR 756 crores to INR 446 crores. So our collection efficiency is improved through a large extent, but still we continue to hammer that whatever residual stress we have. In the asset quality, of course, we had data slippages in the Q3 to -- Q4 over Q3 from INR 243 crores to INR 248 crores, primarily for the low segment agriculture advances that we recognized in the quarter. This is in line with what happened in March '22 also, INR 433 crores. We have been able to recognize a large part of it. Going forward, I think this will stabilize and we have a much improved agriculture portfolio now. The overall slippages FY has grossly reduced from INR 2,000 crores plus to INR 900 crores. The significant number here is the total recovery and upgradation, the last row that you see is that last year, it was INR 2,143 crore. We were able to maintain that momentum, and we had a INR 2,151 crore of recovery upgradation in the current financial year as well. And if you see the second last row of that, the recovery in the PW accounts has moved also positively from INR 338 crores to INR 536 crores. These are my operating net profit numbers. Net interest income for the variation for a year was at 12.10. We lost out in the Y-o-Y variations for the quarter, and that was primarily due to the interest reversal that happened for the agriculture accounts that we recognize. Otherwise, we feel that it is a one-off matter, one-off quarter. And in the going forward, we should be able to control things in a much better way. The core fee income has increased on a Y-o-Y basis by 10% and on a yearly basis at 8.9%. The treasury income, as you all know, was muted this year. But we hope that this year -- it was muted last year, and we hope that this year the treasury income will be in a much better way, the way the [indiscernible] are moving. We can hope that the -- we'll be in a -- treasury will be much more contributing to the overall performance of the bank in the current year. These are my numbers on expenses. Net provisions, yes, we -- our provisions overall, has gone down from INR 229 crores to INR 137 crores, and that resulted in a net profit of INR 1,313 crores. We are very focused -- very much focused on [how] are our tie-ups. The core fee income quarterly on a Q-o-Q has gone by 49%. And the new partnerships that we are now having of SBI cards or credit cards, the Bajaj Allianz for LIC business, helped with Aditya Birla. And with the existing partners of SBI Life and LIC, we feel that this year, '23, '24 would be a significant leapfrogging in our core income -- core fee income this year. [That] these are the key financial ratios. The net profit per employee has improved to INR 20.62 lakhs. The return on equity at INR 28.43. The COVID resolution, the numbers are INR 1,256 crores. So I think we are in track and in terms of the overall stress in the resolution -- COVID resolution accounts. These are my NCLT, 99.94% of PCR that the treasury operations. We -- in the last year, we take a conscious call for reducing my duration. We are able to partially succeed in that. The duration has come down from 2.9 to 2.68. My capital adequacy still remains healthy at 17.10. My CET ratio has increased to 14.3%. CET1 ratio increased to 14.32%. So we are adequately capitalized. Our -- the growth story that the bank and the risk-weighted assets movement are in much control. So we are trying to move in a capital optimized growth that we are trying to move in. Various initiatives on digital journeys that we are taking, and these are all going to help me for customer acquisition and acquiring more and more customers. Our Apple Play Store rating has improved to 4.2 in both Apple play Store and the Google Play store has improved to 4.2. The unique feature of our mobile app is that it gives the same experience, UI experience over the web and the mobile app. We are one of the few banks that are proud to have this feature in our mobile operations. We are now going to scale it up and make it a viable product for the bank, for the customer acquisition and giving services to the new-age customers. These are some of my digital numbers. Various initiatives we are working on in the digital front, the WhatsApp banking, the relevant banking. App banking. I think that app banking will play a significant role in customer acquisition and the other online current account opening, we are not having a very good base on current account holders. So the online current account opening will be one of the focus areas for the future digital initiatives. This is my shareholding pattern. And of course, we will be consciously expanding our footprints. We have now opened 28 branches for the -- so far since April '22. We have now increased the number of branches to 1,553. We intend to increase it further another incremental 40-odd branches for the current year. So we should be around 1,600 branches at the end of the year. The BC model -- we'll be implementing the corporate BC model. Around 2,000 BCs, we expect to invite in our banks in the current financial year, which will increase my network and help my customer acquisition and collection efficiency. So these are the various initiatives planned for the current year branch expansion, onboarding our NBFCs for co-lending. We're already there to increase it more, particularly inclusive to the nonpriority segment. We are doing it in the priority segment now. Now RBI has permitted us to do the non-priority segment also in co-lending. So that is what we are trying to highlight here. Capacity building would be a focus area for improving the skill, and fintech collaboration will be another area. We have taken out our RFP on fintech collaboration. The RFP process is on. We feel that we'll get a lot of insight into how to build our underwriting and customer acquisition and through the fintechs that there in the market. And of course, we'll be establishing a CASA back office, which will take care of my -- opening of current and savings account, revamp the call center to a profit center, engage business correspondence, as I mentioned earlier, addition of value-added services through the PSB recap and bring more and more customized of different segments. The guidance is in my final slide. The guidance for the current year is for deposits, will be 8% to 10%. Advances growth is 13% to 14%. Gross NPA, we are at 6.97% now. We will try to reach below 6%. And net NPA, we are 1.84%. We'll try to reach below 1.5%. PCR, we'll try -- we'll scale it up above 89%. Recovery upgradation INR 2,151 crores was what we achieved last year. We intend that we can increase -- we can have a recovery upgradation of around INR 1,500 crores for the current year. NIM, we expect to be over 2.95%. I think there'll be a lot of questions on this front. We'll be happy to answer them. Credit costs should be less than 1%. Slippage ratio, at less than 1.25%. Overall, if you see the achievements of our guidance of last year, apart from a few parameters, which we missed off marginally, I think we were able to stick to the guidance that we gave last year. So thank you very much for your patient hearing. And I'll be very happy to take your questions one by one. Thank you very much.

I hope you can hear me. This is [ indiscernible ] from Kotak Securities.

Please, can you speak a bit louder, please?

Yes. Is this better?

Yes, please. [Foreign Language].

So my question -- [first] question is on the yield on advances. That seems to have declined Q-o-Q by about 25 basis points. So if you can explain what is causing this decline?

Can I stand up because I cannot see you. That is because, as I said, that the interest reversal that happened due to the slippages -- incremental additional slippages that for the quarter 4, that had an impact on my yields and my NIMs, everything. So the major impact has been due to the reversal of interest. The reversal of interest for Q4 was INR 72 crores in totality. And we -- that is what changed the scenario for the yield on advances Q-o-Q [otherwise] on a Y-o-Y basis, we are pretty on track.

But are you seeing increased competitive intensity in any of the credit segments, which could be possibly putting some pressure on the yields?

No. In terms of the -- if you see my slippages in the other segments, particularly the MSMEs and the retail, they are primarily on track. And I think they are under control.

I was talking about competitive intensity on the yield front.

Sorry, sorry, sorry. I didn't get you there. Yes, that would be -- any competition is healthy. How you encash the opportunity is important. We cannot be shy away from competition. Competition will be there. We are in a commercial business. So competition is welcome. The point is how do I overcome that competition and whether I am able to generate alternative sources of high-yielding income assets that need to be worked on. So what we'll be doing is that in the current year, we'll be focusing on those products, which are high yielding like gold loans, the personal loans and we are going in a big way with co-lending that gives me high yielding. Certain co-lending segments, on the nonpriority sector gives me a lot of traction. So while competition will be there, I'll try to make it up with some portfolio building up in these segments. Like if I can give you, for example, that on the co-lending front, we are at around INR 1,000 crores, INR 945 crores. We intend to scale it up to INR 2,500 crores to INR 3,000 crores in the current financial year. The preapproved personal loan we are INR 145 crores. We try increasing the funnel. We intend to bring it to around INR 750 crores to INR 1,000 crores. Gold loan we'll scale it up. So these are some of the identified products in which we'll be closely working.

Sir, second question is on the breakup of your loan book. Can you provide a breakup across EBLR-linked advances...

The EBLR component is 35% and the MCLR is 52%, isn't it? Yes, it's correct. EBLR is 35%. We increased the EBLR component from 32% to 35% and MCLR is at 52%. So 87% is floating.

Okay. Sir, just one last question. How are you seeing the credit demand across segments? Do you see that loan growth can hold up for us in that 13% to 14% range? Are you [indiscernible].

Yes, yes. There's a lot of -- I'll tell Dr. Yadav to pitch in here, but just for the opening statement. I feel that there's a lot of scope for the current demand in the country. And the -- there can be a slowdown. What I -- what we -- I foresee is that the credit growth, which was last year around 18% to 19% overall, if I look into it, may stabilize around 15% -- 14% to 15% in the current year as a whole. So that much of incremental delta impact will be there. Otherwise, within that space also 15%, I think we have enough sectors to work on. I think that Dr. Yadav can give a specific answer to that.

Yes. Besides that, in the growing economy, credit demand is [choose]. And in the terms of segment twice, I'll say as far as corporate demand is concerned, our focus will be [indiscernible], [vehicles], health hospitals, gold processing besides the existing infrastructure lending. So this is huge demand.

And do you see corporate to drive growth in FY '24?

Sorry.

You expect that corporate segment will drive growth in FY '24?

Corporate credit growth.

Corporate...

He's asking corporate credit growth, do you foresee any growth?

No, no. I don't -- which segment will drive growth?

I say, our focus will be in this year FY '24 will be on pharmaceutical, health and hospitality as well as food processing.

And what about retail growth?

Now coming to the retail. Our retail is -- the main driver is home loan, vehicle loan, gold loan and PAPL. So if I [add] the home loan, home loan is a very safe as well as high demanded segments. Coming to the MSME. MSME, our targets will be the midsize MSMEs. And moreover, the best model and the future of the MSME and RAM, I will see the co-lending model. So, so far, RBA has only allowed co-lending in the priority sectors. Now they have opened, particularly, they permitted ours for the non-priority sectors. So during this year, we could build up the co-lending book of INR 950 plus crores. Now we are expecting INR 2,000 crores plus. And this is a very safe in the sense. As on date, even we don't have any SME 1 in the co-lending portfolio.

I'm Ashok Ajmera, [indiscernible] global. Sir, our, first of all, compliments for continued good performance quarter after quarter. And coming to the very good profit levels, net profit even after the tax and everything. Taxes, of course, either considered it may be notional only because we have DTA debits there. Having said that, sir, our NIM is still a concern. You also said in your presentation, and I would like to have a little more discussion and elaboration on that. And one main reason is that our CASA traditionally is very low. I mean we are in the range of 33%, 34% of the CASA. And because of that, the NIM is there. Another is that maybe, yes, it was prudent earlier to go safe on the credit book, very, very safe having seen the past, the problems and other things. But now when the markets have opened up, the credit growth is very good. And if you compare some of the nearby -- near peer banks, the credit growth is as high as 29% in Bank of Maharashtra. And -- but still, we are seen to be still very, very conservative. So that is one area where if you can grow corporate book MSAB where you can have a higher yield, your NIM can go a little higher. Secondly, our reliance -- too much of reliance of only on retail, and this makes us very, very competitive in the rates and the NIM again gets affected because of that. So one question is on this that why don't we think a little bit out of the box and rework the whole credit targets and even the strategy where we seem to be very conservative? It's good to be conservative, but at the same time, you have to be in the market. So that is one thing where I would like to have both of you, your comments on that. My second question is on the recovery and upgradation in the '24 target is -- so we had a very big account of share. I think you had about INR 1,200 crores, INR 1,300 crores -- INR 1,200 crore exposure on that. And the srei solution is now soon coming forward. I think CoC has already -- you are all on the verge of finalization. You've got two good bidders also. So that is -- if that is included in the overall, this thing. So will the target be -- still the recovery and upgradation be the same? Or it may go a little higher on this? And my third in this round because a lot of other colleagues are also there, they may be asking the question is on the treasury front that now the things are -- the rates are like easing out. I think the 10-year treasury is now almost 7% or below sub 7%. So can you give some color? You said generally that yes, treasury will do well, but some idea to arrive at from future profitability and some numbers on this. So these are my few observations and questions on the [indiscernible] my first round of questions.

Yes. So if I summarize -- thank you sir, for your question. If I summarize that you have three questions for me -- or for my team is one is why are we not giving a guidance of much more than what we have given in credit. Number two, whether my slippages of -- recovery upgradation of INR 1,500 crores would include srei. And third is, of course, on the treasury. So let me take them one by one. If you really look into the business growth of the peer group, and then particularly the bank you were mentioning over the last 5 years, if you have made a study of that, and you must have done it also. The advantage of banks of the names that you were saying is the great advantage they have on the low-cost resources. The bank, what that mentioned, has a bank -- has a CASA ratio of 55% at this point of time. So for a bank of my size, which has been traditionally at a low cost -- low CASA ratio, to lend qualitatively and also be simultaneously remunerated for my balance sheet is somewhere we need to balance out. If I need to do corporate lending in an aggressive way, [indiscernible] to grow at 30%, I cannot mobilize CASA at that rate at this point of time. So you have to do that, I have to really go into [bulk] resources, which again is a double [indiscernible] for me. So what we are trying to tell to you is that we are moving step by step. We are qualitatively moving in the market. And we are conscious that we can do more. But we -- while we are conscious of that we can do more, we cannot also ignore the fact that my low-cost resources are challenged at this point of time. In spite of all the efforts that we put in, if you see in the current quarter also, some of the private banks and some public sector banks have lost out on the CASA ratio. So there is a shift from the low SA and the CA, particularly the SA to the term deposits because of the incremental data additional rates that they were offering -- every bank was offering. And as naturally this is a part of the cycle. So until we have a really good revenue -- good marketing avenue for generating low-cost resources, the -- just to get for the sake of competitiveness to go into the market and lend aggressively ultimately, things will not work out. Again, the pressure on the NIMs will again, you will only ask me what was the purpose of going aggressively when you cannot generate resources. So I have to maintain a balance. So to make the answer short, the point is that as I generate those resources, I can lend more, and that is exactly what we are doing this year. We'll try to generate more and more institutional CASA, more and more salary accounts. Those SOPs have now been placed. We are trying to generate them. And as we generate them, 13% and 14% is -- and of course, the system -- let us also recognize one fact that the system will also moderate itself. What we had last year, I think your analysis will also reflect that this year, the -- it will not be as high as last year. There will be a moderation there. So we need to be a balance out of it. That's number one. Number two question is on your -- the recovery upgradation. Yes, this phase we have our INR 1,200 crore growth and we have kept the guidance of around INR 1,500 crores of recovery upgradation that we have just seen. It includes that. To answer your question, it includes that. But why we kept it so intense INR 1,200 crores so that similar about INR 1,200 crores [Foreign Language] So whatever comes will be part of the equity and the rest, [rest] what has happened is our inventory is coming down in the gross entity. Now earlier it was INR 8,000 crores plus. Now it is INR 5,600 crores. So my inventory on the gross NPA is coming down. So certain hard accounts will be there, so -- which will face a normal hurdle for recovery. So that's why we have kept our guidance of INR 1,500 crores. So that is what it is. And the third point was on our treasury, yes, until March '23, we have given an MTM of INR 126 crores. That is there, okay? So with the yields now, at least at this point of time, as we talk is getting a bit favorable. We are expecting a lot of write-backs on that. I cannot share the number at this point of time. But the write-back is there, number one. Let me finish. April's book size [Foreign Language], I think we can have that. Yes, it's there. Exact numbers will be there. The book size would be -- is it there in the treasury slide? Can you just put [in that there]. So [equity] is not there, hardly any. So it is around INR 11,530 crores. My trading profit will increase, number one, and I have started booking them also at this current juncture and my MTM reversal will also be there. And because I was a negative there, I'll have a double impact in my positive balance sheet. So overall, I think things will be much better. Hopefully, let us hope that the yields improve further and remain stable. That's the hope that we all have.

[indiscernible].

It is possible. It is possible. Yes, it's possible. And that is exactly what we are hoping it will happen. Do you want to add something?

[indiscernible] very happy that market is watching us very closely. And this kind of moment is observed by you all. But just to supplement what [indiscernible] and what my MDA has [showed], you might have observed that last year, the credit growth was nearly 3%. Now it is 15%. You should not be told that we are so conservative. We are very, very proactive, but we are very -- how the prudence to grow at the speed which is [indiscernible]. And in the future, we're also planning. We are capturing and grabbing the almost in every sector. And I think rest has been responded by [indiscernible]. Thank you, sir.

[indiscernible]

I mean can you please do so.

That is what I'm saying, see, where we are only 3%, we were not able to come before you. Now we are at 15% plus. We are eager to come to you and know your more -- and this [indiscernible] anticipation from you.

[indiscernible]

Yes, yes.

[indiscernible]

And thank you for pushing us further. Continue to please push us. Yes.

My name is an Manoj [indiscernible]. At the outset, let met complement you on two points. One is the operating profit growth, 69%. It's quite, quite good in this environment. Second thing is return on equity of over 28%. We had said at the last meet at [indiscernible] and also now it is quite good you have sustained it. In fact, we have increased it. And this compares very well with the top-tier banks, which are in the range of 16% to 18%, 19% and other second-tier banks are struggling in that 8%, 10% range. So this is really outstanding for [their] whole team. Now looking at these things, return on equity, I hope you'll strengthen it. It's not difficult. Now looking at operating profit, 69%. One is how sustainable it is? Second thing is I would like you to, if you can show the Slide #20. On the...

Slide #20?

Yes.

Okay. Yes.

It gives analysis of the income part of it, other income. Here, what we see, the growth in operating profit is due to high other income. Your fee income has gone up, that is excellent. And we have this recovery in return of accounts, I think, INR 404 crores. It is a main key point of your Q4 performance. Now we discussed in your answer to the previous question, recovery targets for next year are also quite stringent and quite stiff which you are likely to achieve. Now point is how sustainable it is operating profit growth? Looking at this number, apparently, you will do well in the few quarters due to some particular softer accounts where recovery is almost coming. So operating profit growth is very, very important, if you can elaborate in detail on that. Second thing is we are suffering on deposit growth. Y-o-Y, some sense is there. But if you see Q-on-Q deposit growth, there is no deposit growth, Q-on-Q, December to March. And last time, you had mentioned about a lot of efforts to open salary account, payroll accounts with lots of PSU companies, some had given commitments, a lot of effort is going through because that's a way forward actually. So what progress is being done there? And you're of course, scaling down your annual deposit growth target, which is actually quite a concern. You should have better than the system growth in deposit. We look at the system growth, you match that or you have 1% or 2% above that will be quite good. In fact, never come down below the system growth. So if you can elaborate on that. Next is on the lending front. So you mentioned about in your opening remarks about co-lending, some fintechs and all where I think you have higher yield. And last time also we had discussed the groundwork you had done in that. If you can elaborate on the progress, which is happening? And also MSME lending is quite a good opportunity where you get higher yields and current environment of low credit cost. Apparently, that cycle is going to continue for the next 2, 3 years. So how you are trying to take advantage of that?

Sorry, the last part, you said?

The MSME growth because that gives us higher yields. And particularly, if the lending cycle, it is good -- it is likely to remain good for at least for the next 2 to 3 years. So this can give us higher yields and higher profitability. Then another -- one area of concern is this agricultural slippages. And you had given the deep dive into it. Apparently, it is more because of agricultural slippages, if you can highlight what is there? Is it something which has happened in March and you'll be recovering in the April or -- to what extent? Or there is a high concern because of that? And another -- lastly, on the point of last quarter, when we spoke, we talked about some efforts you are going to do on digital transformation and the app, and if you can give further details on what progress you have done on number of transactions done through digital downloads, et cetera, and the way forward?

Okay. So there's a pretty good number of questions for me. Yes. So thank you for all your questions. I'll try to answer them one by one. First of all, let us start with the slide that you referred to in terms of the operating profit. Yes, you are absolutely right in observing that my Q4 numbers of operating profit growth was primarily driven by the recovery in return of accounts of INR 404 crores and my 10% -- sorry, 49% Q-o-Q growth in the core fee income. And your question, I think, was whether this is sustainable or not. So in terms of my operating profit, yes, we had a good number here. See, there will be a multipronged approach when I talk about my operating profit numbers. If I come to the operating profit slide, here, we had finished at INR 1,450 crores, and we had a net profit of INR 1,313 crores. So what are the multiple factors which we'll be looking into while setting the tone for '23, '24? What are the factors that will come in? While we covered in return of costs, we feel that, yes, the year, as a whole, we can -- the last year, we built a recovery in return of accounts at INR 536 crores. We finished at that, okay? We still feel that this is sustainable for the current year. So we have set a target out of those fresh recovery upgradation of INR 1,500 crores, we feel that INR 500 crore is for our internal target on the recovery in write-off accounts, okay? So that takes care of one part of the annual part that we had a recovery return of accounts of INR 512 crores. That is -- at least for the current year, we feel it is sustainable on that figure itself. Number two, is the core fee income that you see, we had a 8.89%, INR 371 crores to INR 404 crores. What we'll be working on is that, as I showed my partner increase in my slide here that, yes, the overall figure that we look into is that we should increase our core fee income overall, particularly, which is internally within this core income is very [indiscernible] at around INR 25 crores -- INR 26-odd crores out of this overall INR 404 crores, we intend to increase it threefold, means make it around INR 100 crores there. So we'll try to increase there. The other part, of course, which I think we are missing out is the treasury income, which is negative 14 in this current slide. And as I said in my opening remarks, my treasury income will also increase to that level. The trading profit will increase expected to increase. Let me qualify. And my MTM provisions will -- which was INR 126 crores last year, which is making that negative INR 14 crores, we'll get a write back. So whatever we miss out on my -- whatever we missed out on my recovery if it happens, we are going to compensate that through my increase in core fee income, increasing in my treasury income. I think that is one part of the story. The deposit growth, I think, yes, you're right, we are at 7% deposit growth. Total deposit has grown by 7.73%. See, why has it been muted? We are also rebalancing, like we have rebalanced our advanced mix between RAM and corporate, which was predominantly in the corporate segment, we are now rebalancing our liability franchises. And much of our deposits were also at a bulk deposit component was pretty high. We were having a nearly 27%, 28% of bulk deposit percentage in our books. So what -- the answer to your first part of this question is that why it is only 7.73%. Partially, it is answered by this logic. We're trying to reduce that part. So now we have reduced it to below 25%. The 2% we have knocked off. We required a stable retail liability base because we are not having -- by legacy, we're not having a very big liability. Our customer base is very skewed. It is in the geographically oriented area. So we need to balance it well. And if there is a difference in the system of around 6% to 7% between the credit growth and the deposit growth, it is not fair for me to understand that I'll do something different with the legacy that I have. So that difference will continue to remain for another 1 or 2 years till we build up this portfolio in a big way. So our main target, as I said in my opening remarks is that build my institutional CASA base to a large extent. So that will help my base -- reduce my deposit component. In my average peer group, the retail bulk deposits is nearly in the range 10% to 15%. That's the average of the PSBs. Some banks are below 10% also. Some banks are 1% also. So in that context, I have to think of my balance sheet and how do I move it along with my other banks. So that is where we are looking into. In terms of your co-lending, your question on co-lending, we are at INR 945 crores now. We intend to increase it to INR 2,500 crores to INR 3,000 crores. That is the range we are looking to build our co-lending book. On the agri, we wanted a guidance on how co-lending is.

It is more than 11%.

[indiscernible]

10% , in some of the product it is 11%.

Average will be down 10%. You can take it as an average 10%. So that is where my yields will also be positive in the sense that I'm doing more of gold loan, personal loan, these are the things which we'll have. So your question on agriculture slippages, yes, the primarily -- the quarter 4 slippages were primarily in the agriculture segment, you can see INR 231 crores against INR 36 crores last quarter. That is the difference it has made to my book. And partially, we felt that it is better to recognize and move on because we all understand the complexities of our agriculture portfolio on the various external environment. So -- and we are in a belt where the agriculture is a predominant economy. So whatever challenges are there, we have now recognized them. I will not say that they just totally off the -- because there will be new challenges coming forward as we move ahead. But primarily, we feel that it has been -- much of it has been recognized at this point of time. We don't foresee such of a challenge in the coming year, at least going forward. And digital initiatives, yes, we are working on various digital initiatives instant -- see, ultimately, my CASA -- these are all multipronged approach for increasing CASA. On the stickiness of the customer has to be improve. The services quality has to improve. The super app concept has to be implemented. What are the value-added services that we can provide in a digital lab. So more and more customer acquisition happens. At one point of time, 1 year down the back or 2 years back, we were only opening accounts at a net run rate of 1.5 per branch per day. So now we have come to a situation where it is now 2.75 per branch per day in terms of the savings account, I'm saying. So that is a traction of mobilizing customer acquisition. And as my app becomes better, as my services become better, as my salary account mobilization become better, I think my -- the CASA portfolio becomes much more healthier, which gives me some room for further lending in a better way. So my digital and what are the things that we are bringing in, we are the only app -- one of the few banks who have this app. The second bullet that you see, the same UI experience over web and mobile app. So this is an app which we are now trying to market. We could not do that. People do not know this product that we are having that omnichannel experience. So now the app has stabilized. That's why we have shown that it is at 4.2. And both Play Store and Apple Store, it is unique here also. I need to match it with my name of the Apple. It is unique, is that normally, to get this rating, the private sector banks, if we go into Play Store, will range between 4.3 to 4.4. So my app as a public sector bank and that to Punjab & Sind Bank, getting in the train itself shows that we are very serious on this aspect. And more and more features you asked about my digital transactions, it has grown by 78%. UP has grown by 124%. PSB unique users, 182.51. We have set a target. We -- in our bank, the customer base is around INR 1.35 crores, if I look into that way. And the non-BSBD customer base is around INR 60 lakhs. And so when we brought this mobile app last year, we have set a target of 10 lakh downloads for the current year over last year for '22, '23. And I'm happy to tell you we have nearly achieved it. The downloads have gone up to 9.52 lakhs. So now the next target is to not only increase my downloads, increase my activation. So activation rate of my -- of my those who are downloading my app, that's why we're bringing those services, which will help my activation of my digital app and WhatsApp Banking is very near. It will be a [indiscernible] very shortly, [variable] banking. This is another new dimension for new-age customers. App banking, that's very important for customer acquisition. Today, customers will not come to the branch. People have to outreach and go open their accounts. So go with the tab, open the account online, It gets activated at the back end, that is the trajectory we are looking at. So app banking will be there very shortly. Online current account opening. We have savings now -- a current account opening. We have only INR 4,000 crores of current deposits. The prime problem is our digital apps was not conversant in today's environment to handle current account holders. That we used to be frank about. So that, we are working on now. Another area that we'll be working. So overall, we have a lot of initiatives on the digital front. And I think the way we are going strongly on the digital way, the customer acquisition, the stickiness, the product per customer that we are going to sell will be qualitatively much improved.

Sir, one point on...

Anything i missed out, please let me know.

Yes. Digitally, you have given the percentage growth on the low base. But on a total percentage of transaction, how many are digital out of 100?

Yes, it will be around 84% now.

84% are digital?

Yes, that is excluding ATMs. Core digital is -- of course, that is driven by UPI that every bank has that. But the overall -- say, technically, it is 84%.

Lastly, what is the deposit and advances per branch?

[Foreign Language] business per branch, I think I can show you. Yes, business per branch. There, you are. INR 124 crores. INR 124 crores business point that is a slide -- bullet 3.

No, no,. Top premier banks have started giving data. Their -- it's around INR 200 crores advances and deposits in the top main 2 tier, HDFC Bank and [ICIC]. Lastly, I think deposit growth, we you should take a learning from what IDFC First Bank is doing. Maybe all of you should go and visit their new branches and how they are trying to control the cost of deposit and everybody needs to learn from them and wish you all the best for the coming year.

Thank you. Thank you. We'll do that. Yes.

Sir, congratulations on the [indiscernible] result. I'm assuming some of the answers that your outlook on markets that rates have peaked.

Sorry.

Interest rates have peaked.

Interest rate have peaked, yes.

Whether it is [indiscernible] or global benchmark that is Fed indicated yesterday night and maybe MPC. In view of that, you have already answered that you'll have a [indiscernible] reversal this year. The second assumption I'm going by that your MCLR has peaked. So in such a scenario, where our CD ratio is stable, but we have a long gap to capture the business. So in such a view, would you increase your advances in the first half on a more aggressive basis to capture higher rates, which are offered by the corporates? Or would you wait for the rates to decline and continue the business?

That's a very interesting question that you have asked, how do I plan myself. See, planning, we can make -- planning should be over a yearly basis on a medium to long -- short term. But the planning should also be flexible in the sense the dynamics of the interest rate [indiscernible] also need to be looked into. In the current situation, you are right. The way the things are moving, it seems that the yields are at a stable phase, and we are going to get some benefit out of that. But to answer to your question very specifically that whether we'll do aggressive in the first level -- first upfront or we'll wait for that, that's an area which we'll leave to the market dynamics to play as its role. And we we'll not be very conscious of the fact that what we should do upfront and what should happen, depending -- as I said, my main challenge of my deploying resources is my garnering of low-cost resources. So if that thing happens, that takes some traction, yes, we can really go into that, and we are already working on that. But until we do that, it is not advisable from our perspective, what you understand from the book is that to grow very aggressively without having the backup of a stable retail base or a stable CASA base.

No, but you may take a 1-year, 2-year kind of instrument or it's not necessarily you have to take 5-year, 10-year term loan?

2 that's [indiscernible]. That's what I'm saying, it is very difficult to say as a strategically what I will do on a portfolio basis. On the merits of a case, If a case comes up -- we'll take it as a matter of the...

No, the reason I'm asking is between doctor and yourself, you have treasury and advances, both combination well [ versed ] between your previous bank and current bank. So as your experience speaks for itself in the past, I think we are well positioned to capture that. So I'm just...

You're absolutely right in your observation. And in fact, though I have a treasury team, I take it very strongly every day morning what happens in the dealing room, and I try to understand what best we can do in the present context. So you are absolutely right in your observation that the times have come where we are -- we can take a leapfrogging up, as you rightly said. But we will leave it to the -- some of it to the merits of each case and try to work on -- the skill development also needs to happen side by side on banks which are growing in quantum and leapfrogging are also very conscious of the skills that they have a backup. So my -- I need to take a very strong position on that per se also. My skill development, the dynamics of today's financial environment is such that so many new things are happening. The context is changing every day. So my people management and the people resources have to be skilled, reskilled, deskilled whatever has to happen. So that has to go priorly to that. So from bank of my history, we need to be a bit circumspect into how we move ahead and not really try to emulate the system as others are doing. It's better to be circumspect, create a strong, stable base. See, everything -- the base has to be stable. And we are actually looking into that. If you see the last 2 years' performance, some stability has come system. And to have a back-to-back profit of above INR 1,200 crores and INR 1,300 crores, it still shows that the base is getting stabilized. So once the big base becomes much more healthy, stability is there. I think leapfrogging can happen and we can press about an at any point of time.

Sir, hearing your answer, skilling and hiring both seems to be a priority from your management team. Now what kind of budget are you doing between digital and hiring? And what is the average is today, so you will be able to blend what is the vision of the bank? Because what you are taking a lesson is from your history, but your future is not dependent on what is your past.

Absolutely. Regarding how are we skilling and reskilling them people, people resources.

Actually, what we have done is human resources that the bank is a very important thing. So last year, in a detailed exercise, we have profiled each one of the staff members and we have grouped them into different skills. And we have job families -- organized them into job families, the first work that we have done. And regarding HR initiatives that we have taken. So another thing that we have done is that from the market where you must have seen our recruitment drive, we are taking lateral -- making lateral recruitments and you see one of our CRO, also is from the market -- we have taken directly from the market [was] come from State Bank of India. And similarly, we are taking other [indiscernible] also. The third thing is that now we have already started putting our staff members to various top level institutes for training like IMs, et cetera. And also, the -- as well BBB, they had deviced a program for -- leadership development program for the top executives. And each of the way we have been recruiting 4 to -- 3 to 4 officers at the level of BGMs and GMs to groom them to the higher level. So this is a continuous program and we will continue with this upskilling program.

Sir, I'll just answer a question, so you can combine that. The story which I've heard in some of the answers which you have given, is feet on the Street seems to be a very important part of your journey because you're looking at CASA, retail, co-lending, MSME. So the top management can drive the bank but feet on the Street seems to be important. And I'm sure I am and all these top management, this staff is not going to be trained there. So for that process, what kind of spend are we doing in digital in terms of reskilling the entire bank? Maybe new-age staff, new staff, new recruits, whatever, but that seems to be the important part of your journey for the next leg.

Yes. I think I appreciate your question, Mr. [indiscernible], is that, yes -- see, what we are not focusing entirely that we are going to reskill our top management at the higher end of our executives. That is a parallel exercise that's going on in the bank to reskill the middle level and the junior level. And of course, we are very conscious of the middle level also for the skill force and the skill size, which are a very important link between the lower executive to the higher executive. So the lot of skilling on the market, particularly if I say, if I do co-lending also, if I do back office structure, MSME lending also, I need skills there also. It is not that no skill is required there. So we have given a very focused priority on -- through our staff training college, other staff training college, other staff colleges to create batches and to only to educate and reskill this level of employees, who will be, as you rightly said, feet on the Street, who will be on the ground to help us out on the assessment and turnaround time. So it's very important that -- so while we will be sending the top layer to the executive programs, which is required for the -- their level, the parallel efforts will continue to happen at the lower level. So we're now planning a separate -- we're creating separate batches for branch managers at the 3, 4, 5 level, put them into cohorts and build them up for the future leadership, trying to build that up. So we are at now -- internally, we have revamped our training advisory committee. So that -- we have taken external experts for that. We'll be doing a lot of groundwork on that. So these are -- in terms of the quantum of -- you asked a question regarding the quantum investments that is what made on the digital front. At this point of time, our technological, first of all, upgradation of 7x to 10x is happening. And we had a INR 250 crores of investment there, which is now likely to be completed by September entirely. So once that is completed and we understand the finacle 10 working and understand how it has stabilized. And then we owe September, what we will be doing is clearly looking to the [indiscernible] from 10x where we move on in terms of the rising digital transactions that are happening, whether my 10x will be itself enough for the future, next 3 years or 5 years. So we have to make a plan out of that. Why I cannot quote a figure at this point of time is because unless and until I come to that basic level of TAM, I really don't understand how to make the next step forward. So we'll have a technology upgradation platform, upgraded version and keep the concept paper for that post the implementation of the finacle 10. So we leave it another 2 quarters down the line. I think the answer to that question very much more specific.

But because we are doing...

Let me supplement. I think you are also [indiscernible] hiring and this feet on Streets. See, there are three aspects which your bank has started in this well. Feet on Streets, we are already in the process for robust call center, for which we are having a large number of Feet on Street. Number two, for sourcing the new business, we are also having a DSA channel. Number three, for inclusive growth, so far, we were having a very limited [indiscernible] BCs. Now we are already onboarded and things has been started for corporate BCs. And in the first half, we will be onboarding around 2,000-plus BC, which will be reaching the last mile of the people. So these are the way that our -- even the large [force] will be available on the ground. And for the other kind of top leaderships, I think my MD and my [AD got it] already explained.

Sir, my question to you is you have a rich experience in MSME. Punjab being the agriculture, Haryana, your region. You have large pockets and relationship, maybe 5, 10 decades old with your bank. Now how are we capitalizing on that because value addition and today's food habits are very clear that people cook less and eat more of ready-to-eat and the supply chain is very good in the region where you are capitalized. Does your competition penetrate your area? or You will garner our larger share? Secondly, you have a rich experience from UP, which every bank is looking at because of the kind of expenditure in infrastructure and growth is likely to happen. In fact, somebody highlighted last week on media that reverse migration may happen and in the manufacturing, we will not have people coming from the north. And we may have to look back to relocate to UP. I mean those kind of years are happening in the state of Tamil nadu and some other states. So you may be well capitalized from the knowledge which you have. But how is this bank going to emerge a winner? Maybe current management team may not get the benefit or the future of the bank will definitely get the benefit.

I think definitely, your observations, your guidance is very correct. Now the time sees of having the total finance planning of the people and for that, we require specialized relationship managers. That process is already owned. For MSME, we are having the special relationship manager at our back office [indiscernible]. And in some banks is called SME loan factory like concepts. So is there. And I think more...

I'll just supplement, I think you have put the big picture in mind -- talking on a big picture in mind. Certain areas where we were shy of lending, so we are not in the [indiscernible] finance area. So we need to move on that. We are not in the CRM concept, we need to move on that. We are not in the area of customer acquisition drive per se, so we have created a separate vertical for only customer acquisition. The fee income growth story needs to come back -- needs to come back is not -- it needs to grow exponentially. So we've created a separate vertical for that. The organizational restructuring has been done. We have created the back office for the small value segments. So specialization happens there. So these are fundamental structures which are getting into place and which I'm very sure if implemented one by one, can really make the foundations very strong. The foundations need to be very strong, whether it's on the HR side, whether it's on the technology side, whether it's on the product side, whether it is on my processes side, all the areas need to be looked into separately. One is all complementary to each other. It cannot go in one direction. So this parallelly, we need to bring a lot of things together and collect them and create a base structure. And that is why we are doing -- taking -- now we're in a stage of taking those -- last year, we took a host of initiatives. It has all culminated. To a large extent, whatever we planned. We got it through. Next is the journeys will continue to happen. And one thing I think which we -- I think what you are hinting at, particularly the MSME segment. Today, these segments, particulalrly agriculture and MSME will require great speed and collaboration will be the main area where we look into. So the fintech collaboration, as I said in my presentation, that is there. And we have loaded the RFP. The RFP is on is going to culminate very shortly. So the tender process will be completed. We'll have a host of fintechs on board under various issues. It's not only one single dimension. It can be anything. There's a lot of, I think, cross-functional issues are there. So once the fintechs are there, we get the best underwriting standards happening. Our LOS gets improved. So the automatic lead generation gets -- lead generation management becomes a core area. The CRM can be implemented. We are now -- given the -- to my corporate credit vertical, how do I implement my CRM for the corporate account. That gives you a lot of revenue and customer relationship management -- customer relationship. So that is what we -- so the fundamentals need to be put in place. We are here to showcase that, that we are going slowly but steadily to first address the structural issues of the bank. And then -- and [indiscernible] as much as possibly -- possible to qualitatively grow and create -- give a good return on assets. We have a good operating margin. We had a good net profit margin. So those are the things. Once we have those things in place, I think leapfrogging is a matter of time for this bank.

Sir, my last question, we have deep roots on Punjab. How much of NRI deposits we garner? And how much of FX business we manage?

Deposit [Foreign Language], right? I know. It's an area -- so see, ForEx is another area. So let us answer the -- data point I'll share with you. Data point is not an issue. The more is a strategic thought process we are working on. ForEx business for me is again a small entity. We didn't have this appetite to do ForEx business. So what we are doing is now we are now doing NRI outreach programs. We have done NRI [indiscernible] instrumental in going to places. We have to do outreach on NRIs to garner deposits. We are getting the competitive [indiscernible] the branches, but the ForEx -- turnover is very small. And many banks, we are -- many customers are having credit lines with us, but doing ForEx business with some other banks, bringing more business with some of the bank because we don't have that structure in place. So ForEx -- again, ForEx needs a good investment on time and resources. So once we develop that, all these things can -- will automatically happen in the bank.

This is a [ indiscernible ]. I would like to ask you regarding your co-lending space. You're expecting the business to go from INR 950 crores to INR 2,500 crores. So who are these co-lending partners basically? And what is the kind of lending being done with them? And secondly, I would like to know regarding your new to credit customers. So for new to credit. So new to credit customers, year-on-year, how much you've added new to credit from '22...

New-age customers.

New to credit.

New to the LTC.

From FY '22 to '23.

Let me respond like that. In co-lending partners, we started co-lending last haf years. We're the only one co-lending partner. Naming the partners, I think, will not be fair enough here, but now we have extended more than 6. And as I explained earlier, that initially, RBI has allowed and opened co-lending for priority sector segments. Now because the co-lending is the best model to reach out and having a good underwriting systems, now we are also going for the non-priority sectors. So as on date, we have 6-plus co-lending partners, having [the escrows] the country outreach, so we may be having [indiscernible] the entire portfolio at Delhi. But my co-lending underlying assets and borrower is spread out across the country, number one. Number two, coming to the new to credits. Once our credit has been happened this year, it is around -- our 50% total acquisition during the year is new to credit. And in the retail, if I say home loan and vehicle loan, the new to credit customer is more than 70%.

I think someone want to...

Congratulations, sir, on a set of numbers. Sir, my question relates to basically more of on the financial performance with respect to credit cost. So this year, again, we saw a marginal negative credit cost. So your thoughts in terms of how long this can carry? That is one. And probably in terms of from your guidance perspective, your [street] perspective, you have given that you would like to maintain a PCR above 89%. So is that indicative that probably in terms of the net slippages would continue to be very low, and that is driving your PCR to be above 89%? But in that context, 1% kind of a credit cost. Is it too conservative?

Yes. See, it is a matter of interpretation of whether it is conservative or not. But yes, let me answer to be specific -- to specify the answer. Credit costs for March '23 was at a negative, yes, of course, the incase of the provision write-back that we had. It's a mathematical calculation. Nothing to talk around that part. Why have we kept that less than 1%? It is better to be conscious of the dynamics of the ecosystem that happens. It is -- while we can be very aggressive in giving our guidance, but certainly, some news happens as it happened 1 year line news came into the picture [certain thing] everything was there was a rule in the market something happened. So these sort of things will always be there. And we don't know the globally how things are panning out. There are still some sort of uncertainties in the global platform. While the yields may have stabilized, but the uncertainty is still there and the impact on the Indian ecosystem is -- it can be -- have some impact, which can come up for a surprise. So those -- keeping those things in mind, we think that it's better to watch because if we give a very aggressive guidance on credit calls, it may seem that we are very complacent about the things. It can be interpreted that way. Are we too complacent. You can ask me if I give 0.5 or 0.25 credit costs, you may ask me whether are you too complacent about your situation? To keep this balance, we say that, yes, we are still at less than 1%. Things happen. Agriculture, though we have recognized well, it's a story that will come -- of one-off because it's an environment that we -- in the system that we are in, these sectors are very vulnerable sectors, agriculture, MSMEs. So to that -- keeping that in mind, it's okay. In terms of actuality, you will see my SMA portfolio has gone down about INR 5 crore. And even the data I don't have here, but even the INR 1 crore above data, it's a significant improvement, it is there. So in fact, if you look at -- I think there is a data on this. Yes. So my SMA-2, if you see above INR 5 crores has gone down to INR 107 crores from sequential down, yes. So that's -- it's a good number that is working -- we are working on. A lot of activity goes to achieve these numbers. So while we will -- we are conscious that things are improving but we still feel the [indiscernible] is still on in terms of collection efficiency. So we'll continue to have our war rooms active and not dismantle them, okay? So we will continue to focus very closely. And as my call center vibrancy comes in my recovery and my monitoring, I think we will be in a much better position to give a better guidance and a much more, as you like it -- as you will like it, okay? So that is there. So it's a matter of interpretation of how we look into. It's better to be conservative and achieve something better.

Sir, the question also pertain to because 1%-plus [ROE] that we are delivering, a large part of the gain is actually flowing from the credit cost.

Absolutely.

And we have seen the 2,057 cycle, where probably in terms of the credit cost was very low or negligible. And your thoughts in terms of -- even if there is some pressure in terms of asset quality that builds up 6 months or 1 year down the line, would you be reducing your PCR? Or probably you'll keep your PSR healthy or strong -- the way it is?

Okay. There are two parts to your question. In terms of your question on the operating -- net profit [ROE] has been driven by whether it is driven by primarily by write-back. I think to be fair, if you see my -- let me see if I can get that slide on regarding my provision slide. I'm getting confused where it is. Yes. See -- if you see that my net profit has been INR 1,313 crores, the loan loss reversal and standard [indiscernible] INR 513 crores is a effective. But some of it -- my operating profits also has come due to some good recoveries in my write-off accounts, okay? So it is not totally that I am -- in terms of ratio, yes, you can mathematically say that, yes, it is -- our impact is there. But if I can increase my other income, if I can increase my net interest income, as I elaborated earlier, achieving ROA of above 1 is quite possible in the context. We are moving in that direction. We are very confident that the ROA can be improved further for me for my [indiscernible]. And what was your second point was?

No. So would you be compromising on the PCR [indiscernible]

Okay. The PCR, see, today, we are at 89.6%, right? Ideally, we would like to have it 90% plus. We are -- we watch this 1-year performance, let the some of the big ticket resolutions are going to happen as srei was already discussed if something happened, 1 or 2 more accounts will get resolved. And once -- but until now let us strengthen our PCR above 90% for 1 year down the line. And move on to that in the next year, we'll take a call on how to utilize that PCR in a different context. So for the time being, we feel that we -- instead of working too much on my ROA while we would like to give a positive guidance on that. But to go overboard and increase my ROA and not increasing my PCR will also not be fair at this point of time. So we'll keep a combo approach on this.

Sir, final question from my side. In terms of MSME lending, If we actually look at it then probably public sector bank as well as for us, the GNPA ratio has been high in the past, which has come up significantly in the last 1 year. Now your thoughts in terms of what are the changes that you have brought about in terms of the risk management that even if the economy slows down, probably we will not see an NPA rise in MSME? And also because you have actually grown around 6% on a Q-on-Q basis in terms of MSME, is that sustainable? So are you seeing a structural change in the way you're operating the MSME, sir?

Very good question Yes. I think you're absolutely right. See, this is what I was saying also that once I keep my structures well, if I keep a structure positively done, I think we can move very safely. Coming to your question specifically on MSMEs, yes, we have strengthened our LOS, our underwriting systems. We have bought into the back office structure for segregating the sourcing and sanction. The observations so far are very positive. The trajectory of what -- so it is 1 year old only, not even 1 year old. It is around 8 months old. So -- but still, we get our early warnings in every account, what we were getting earlier. So the trajectory is very, very positive on that front. So the structures are working there. Third, we'll be looking into a much more robust monitoring of credit life cycle of a model, okay? So that is where, again, we are very strongly working on. While my risk management practices are getting strengthened in terms of my appetite, fixing my appetite to what level of exposure I should go, whether there'll be concentration risks, et cetera, all that is a risk management perspective. I'm trying to get into a mode where my everything is automated on a credit life cycle process, right from sourcing right into the default and post default. Okay. If my [right] credit writing engine becomes much more robust, my structure -- and that is -- that is possible, and we are working on that, I think we can really much more work on a much more greater PS to increase all of this, whether it is MSME or some part of retail or agriculture. As that is this thing that can happen. On the MSME front, yes, we are growing at what, 14% now, maybe now. How much? odd-14%. So yes, we have a lot of room to improve there. I think we can improve it to further. With the co-lending space in place, I think we -- anything about 16% to 18% is possible in the MSME space. So we are working on that.

So similar question in terms of the retail lending as well. Yes, we have seen that probably the vehicle finance and personal loan, though those are very small proportion of the book right now but the clear intent is to actually grow this book significantly. Are we tapping our internal liability customers or basically in terms of how should we judge in terms of the performance of this book 1 year, 2 years, 3 years down the line?

Again, here, we have now not only -- first part is existing customer. We have created products for existing customers, particularly the preapproved personal loan, we are now digital in that front. The three-click model on a mobile app for personal loans, we are already there. Yes, but that is only for the existing salary accounts that we have or the pension accounts that we have. We are now going to increase the funnel to the other segments based on the data analytics that we have, not only to our customers, but to our noncustomers also that to some segmental customer where we can have a high CIBIL score or a single government employer or a state government employed. So that is where we are coming in, though, yes, because of the small base, the percentage looks very high. But we have a lot of potential in the personal growth story. And the home loan, of course, is a vanilla product for everybody, which we need to improve upon. And vehicle loan. We're also getting into the second-hand vehicle mode now. And that's a big market that is coming up. We are not present there. We're not visible -- we're not anywhere visible in that area. So very recently, we have revamped our products on the secondhand vehicle loan category. And market trends are there that we can enter very strongly. Our yields are also better there. So we'll get into that space. The gold loan space, we are working on that whether -- or increasing -- the trajectory is not here, but is growing very exponentially there also on the gold loan front. Again, a high-yielding return assets that we can create. So all in all, overall, within the retail, these will be my specific areas of going ahead. The co-lending on the NPA segment also gives me a lot of high-yielding assets. So I think overall, we can build up a good base there also.

And sir, not basically in terms from the near-term perspective, but your margin of around 2.9% when you're talking about the mix change in terms of some of these products as well as MSME and improving the CASA mix. So what is your basically idle margin or basically a sustainable margin that you want to reach probably 2, 3 years down the line?

Yes. See, for a bank of my size, and to be very, very grounded on my assessment, I need to really ground it. Okay. I'm -- my legacy and my -- the nature of lending that we have done, the loan book growth story that has happened over the past years and the level of customer base that I have, the level of technology that I have, the level of digital -- digital methods of lending I have, so keeping all that in mind and the low CASA ratio, that I talked about earlier is also something we need to be working on. So if I -- while I -- while we all try to get some benefit out of the high yielding assets here, I also need to do some corporate lending. We need to increase the book. Where my margins maybe a bit squeezed. So it's a double whammy for me, a very low CASA, historically, and corporate lending not being done in -- while I've increased my portfolio in my AAA retail assets that you must have seen, but the margins -- the -- is very low there for that. So I need to have a balance. To have a -- to keep it in that in totality and be grounded to the situation, anything beyond 3, 3.10 would be my optimum level, which I look into 1 or 2 years. It is not -- and it's a practical assessment of the things that I have. Once, as I said earlier, lending my income generating starts and I have a good CASA base, I think -- anything beyond that is possible maybe at least the average of the public sector banks can be achieved, which is around 3.4% to 3.5%. I think that will be our assessment. I think once we have data for that. So that will be a public sector average. But as of now, in a 1-year, 2-year horizon, I think we can look into around 3.10% sort of a thing annually. And we are pretty close to that. So if you see my -- if you have observed my last 3 -- 4 quarters, my quarter 4, 3 was 3.12%. My 9 months was 3.04%. So I was pretty in line with that. We got this agriculture stuff -- if that was on the incremental interest reversal that happened in Q4, brought it down a bit more than we expected to be. And if I discount that, my yearly NIM would have been around 2.97%. Okay. So pretty in line with my guidance, so it would happen. And hopefully, if I can [plug] that point of agriculture slippages, which I'm very sure we will, 3 is any way possible in the current year, possible and maybe another 10 bps next year down the line.

Sir, my question is with respect to the previous question. Although our retail is only 17% of the book, we are growing this personal loan at 75% growth rate, although the quantum is very, very less. But do you see --[ do you] are in the camp of that retail is just starting to grow and we may have 3 to 4 years of runway for this growth to continue? Or do you, in the camp of saying that because there was a problem in the wholesale book over so many years, last 4, 5 years, people are now focusing on retail and now retail has reached to a peak, and we may see some kind of an NPA cycle in the retail loan also?

Yes.

See, this all depends how resilient you are. And resiliency is nowadays measured in three ways. My financial resilience, operational and organizational. Now as far as this financial resilience is concerned, this is not only driving force that's corporate in having high NPA. That's why we are moving to retail, no. It is matter of the fact that demand is more in the segment. Moreover, My risk is diversified. And third one is I'm having that competitively more yield and my customer base is going more -- that is more sustainable model. Even nowadays, it depends how business model you are functioning in. So this is not only the driver that's corporate was having the high NPA, that's why we moved on. No. We moved on because of a number of large customer base that is sustainability. Number two, high yield of course and risk diversifications. Now coming to whether it will be sustainable or not, definitely for the bank like us, which has [indiscernible] started now growing after 3, 4, 5 years, some kind of legacy issues, that it is more sustainable. And strategically, the Board has also decided that we should increase our percentage of the retail more in the total advances. So last year, if we were 50, 51, now we are on 53. Then FY '24, we may be 55. It doesn't mean we will not be growing in corporate. We will be growing in corporate too but on the segment and area and industry, which I have earlier [mentioned]. I hope I have responded.

Sir, can I come again in the -- so madam, something on the DTA end is tax and the carryforward losses like DTA is about INR 1,550 crores. How much carryforward losses you have from the income tax point of view? And how are you planning to write off the DTA, again, leveraging to the P&L in the coming period?

Sir, our major details on NPA provisions. And as of now, in the books, we are having loss as per the income tax. And we are coming in the [ met ] provisions as far we are paying tax as per the [met] provisions. And moving forward, as we see that we are creating -- we are getting the reversal of the DTA. So we have some reversal also. In the coming years, we will be making provisions, then there will be reversal on DTAs.

How much is the quantum of the carryforward losses is per income tax?

Sir, in this year, we have INR 11 crores of carryforward losses in this current year.

Total carryforward losses are only 11...

Sorry, actually, in the income tax, we don't have the earlier carryforward losses. And in the December quarter also, we have marginal profit. Now in this quarter only, we have moved into INR 11 crore of that income tax...

So it means that from the next year, coming year, now you are to pay actual tax?

Yes. Yes, we will come in the actual tax forum...

Under the new regime?

Yes, yes, yes.

You're asking on the swapping.

No, no, sir, they are not saying no, we are not -- this year, we are in the old regime only. In the coming year, whether we will be taking the [indiscernible] it will be decided...

No, we have not decided yet.

But depends on your...

[indiscernible] we have INR 1,800 plus crores of DTA. So we have also [met credits] also. So that is real profitability. So we'll decide on the figures, rather we'll move to the new provisions or not.

See, this retailers to -- if [indiscernible] to move to a new regime. It may come to between INR 300 crore to INR 350 crore. That we will decide...

Yes, therefore only I'm asking that how much are you ready to...

That is for the quarter. No, no. No, no.

Tax component on that is around 350, 400...

So that we will decide -- many of the banks have not moved -- you must have seen for the -- now more than that, we are having met credit also. So met credit also -- you consume that. So when both are done, then only we will shift it. We have assessed and each quarter, we assess. And when we find that it is not beneficial to the event, we are moving ahead with the old regime.

Okay. Sir, now we were talking about that our PCR provision coverage ratio in this. So here, I would like to know that how much buffer do we have in our provisioning, COVID buffer, as well as overall buffer, which is not allocated to any particular thing. What is the amount of the buffer which we have in our provisioning, which can take care of [years of some] eventuality in future like you said, going or something like that? Of course, we don't have it.

But we see -- we have -- we don't have much of a stress there, but still we have one of you. We have our one account where our state government small value small INR 300 crore [indiscernible] that some issues are there, what we have provided a standard is'nt it back by state guarantee standard, but we have provided 15% for that. Okay. We have provided 15% for that. So right -- so our INR 40 crores, INR 45 crores have been provided for. Sir, we are okay with that.

Other than that, any buffer, which we have built up? So overall, we have only this INR 100 crore or INR 80 crore, INR 100 crore buffer. We don't have any...

See if you have seen our last 3 quarter results, we have been providing additional for each quarter, which will take care of my future aging provisions also. For Q1, we did around almost INR 300 crores. And then Q2, we did around INR 270-odd crores. I don't remember the exact numbers. but we created those buffers, which are getting utilized also as we move along forward.

[indiscernible] Whatever your assessment is there, it is a...

So in case of at least that much, we are really already covered. Sir, some color on our overall -- I mean, restructured book, COVID and non-COVID?

The total restructured portfolio of the bank as of now is INR 2,500 crores.

Out of that, how much is COVID? Yes, COVID structure?

it's COVID only.

It's all?

Yes...

Data is here, INR 1,256 crores plus INR 1,000 crores, so nearly INR 2,200 crores. The good part is that the delinquency of the sale component is very less. What is the percentage now, [indiscernible]?

It's [indiscernible] slippage ratio, we have, on an average, it's around 1.4 only.

Okay. Not much something very significant.

And the trajectory is working fine. That's why -- See, the question was regarding our credit cost and all that. So these are the things we keep in mind. Anything can happen, but...

But if all these things are there, and I feel that the credit cost will be much lesser than what you are actually...

I appreciate that point. Yes, yes, yes.

These other factors are not there.

External factors, we have in built in that guidance.

The ROA may continue to be sustained 1.33 or whatever the point -- annual, maybe 1 point...

We'll be above 1. That is for sure. Yes.

[Foreign Language] 4.8 [Foreign Language] we did more than last year. We are taking care of that also.

Government of India holds 98%. So are we -- is my inclusion or instinct telling me, will it go down below 75%? We are in the 75th year.

That's the answer you also know it is not practically is really difficult. So what we are doing in the circumstances, I think there are some banks who are about 90% shareholding is still there. What we are trying to do is trying to send a signal of trying to mop up some small INR 250 crores of maybe equity dilution by [indiscernible] capital for the current year. I already declared that the approvals -- internal approvals are in place, and we are waiting as the government gives us the nod, we really go to the market and think about it. The timing, we'll see. So of course, we -- as you see, we like to convey to the -- to every stakeholder that though small, after a lot of capital infusion for the last 2 years, the bank is now in a position to garner some capital on its own. And that is a perception which needs to be sent to the -- all stakeholders. Though small, we are beautiful. So like that, we are thinking like that. So we will try to -- once we get the approvals in place and the processes goes on, we have the approvals of a combo whether equity or AT1 bonds. But primarily, we are looking to dilute equity. So whatever percentage -- small percentage we can shed from here. And then take -- that's an industry issue of 75% by it is up to [indiscernible] '24. So we wait for the time, whatever call is taken by the majority stakeholder.

On this shareholding only here, yes, sir -- on this shareholdings, sir, I can see only 1% is outstanding, right, in the market. So that INR 200 crore, INR 230 crore of pool deciding the market cap of the company is it, what is the history behind? I was not aware about such a high shareholding earlier.

We had -- we were going to -- things were going tough for all public sector banks, everyone got share of their capital. So we were not an outlier there. Yes, we've got 2 years of back to back INR 10,500 crores. That is what has made it 98.25%. But the good part is while share price is going.

[indiscernible] share went to 42.5 because less liquidity -- all promoted the bank. Every one of us in the liquidity was very small, correct. And everybody was changing the share and went up to 42.5.

So I now know the history we have done.

So that is why this time, he has kept the meeting here in a much better location and together -- it's a good [indiscernible].

It's a good Yes. our returns you see [Foreign Language] 1 year, 1 area where we are better than the peer group is in terms of our share price. If you look by smaller PSBs or we are better than them. So we are at least somewhere positive than the peer group.

And so this INR 10,500 crore infusion came which year?

'20, '21 and '21, '22. It was INR 5,500 plus INR 4,600 crores. INR 4,600 crores, that was the breakup.

Prior to that, what was the capital of Government of India and what is the...

[Foreign Language] anybody knows about this. [Data exact] percentage we share with you separately. We've got the recap to answer that. Yes. [Foreign Language]. Any other question we can still answer? any doubts. [indiscernable] anything from your side -- from your desk? [indiscernible]

[indiscernible]

That is a messaging we want to show that now we are going out of our core areas. And particularly, if I'm not visible in Bombay, where should I be visible? I should be visible. I told you the perception what I'm working -- I don't. At 17.10, frankly, you're right, Mr. [indiscernible] at 17.10 I'm pretty okay.

So you don't need any profit for the current year would even drive growth for next year a perception.

But also to some extent, though small, the ECL hangover is there, which is going to be somehow coming very shortly. And at some form or the other.

Has taken a lot of credit for the stock price, I would give one more suggestion to him. You should convince the government to take back the money from you to reduce the capital because you all continue to expire as we will be growing 15%.

Yes. And actually, such gatherings really inspire us to be frank [indiscernible] for a bank of our size, for a bank of our visibility coming to Bombay and having such others gathering here, it really inspires us.

[indiscernible] bank of india [indiscernible]

Yes, I know. That's why he's driving this all this co-lending, back office, he's driving all that. So these are the best practices of good banks that are -- we have [gathered] in here. Maybe we need a bit of a stable phase, and then we can lead from. So okay. Thank you very much. Thank you all. Yes, please. Just some closing remarks, please.

As presented by MD sir and discussed with you all, the year '22, '23 has been a great year for the bank. The bank has taken many new initiatives, which will continue to transformative journey of the bank. I extend our sincere thanks to this elite gathering to come to this place and invest with us. I'm sure that the guidance given by the bank will certainly be met in the current financial year '22, '23. We will show better results. Thank you. Now I request -- yes, sir? Yes, '23, '24 will be a good year. And now, I request everyone to join us for high tea.