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

Good afternoon, ladies and gentlemen. I'm Shilpa Abraham, the moderator for today's earnings call. I welcome and thank each one of you for joining us today for the Q2 FY '24 results of Punjab & Sind Bank. Please note that this conference is being recorded. [Operator Instructions] I would now like to introduce the management of Punjab & Sind Bank. We have with us today, Managing Director and Chief Executive Officer, Shri Swarup Kumar Saha; Executive Director, Dr. Ram Jass Yadav; Executive Director, Shri Ravi Mehra; and Chief Financial Officer, Ms. Mahima Agarwal. I would now like to hand the conference over to Shri Swarup Kumar Saha, MD and CEO of Punjab & Sind Bank for the opening remarks. After which, we will have the forum open for the interactive Q&A session. Thank you, and over to you, sir.

Thank you, Shilpa, and good afternoon, everybody. On behalf of Punjab & Sind Bank, I welcome you all to this virtual con call for the Q2 performance of the bank of FY '23, '24. The results have been declared and the presentation has also been uploaded in the stock exchanges and the -- our bank's website. So I'll just give a brief of what the salient features of our Q2 performance has been. The business of the bank has been at INR 198,387 crores, showing a growth of 10.85%. The deposits stood at INR 116,481 crores, showing a growth of 10.68%. The advances grew at 11.08% and stands at INR 81,906 crores. Within the advances, the core retail has grown by 17.93%. And the -- overall, the yield on advances has improved by 95 bps. The capital adequacy ratio of the bank has improved further and stands at 17.23%. In fact, if we see our guidance that we'll always continue with our capital optimized growth. So as far as the Q2 performance is concerned, our credit growth has been at 11.08%, while the credit RWA has grown at 8.3%. So that's how we will try to maintain the capital optimized growth going forward also. The significant improvements that has happened is also shown in the noninterest income growth, which has grown by 90.07%, which was aided primarily by recovery in write-off accounts of INR 131 crores. And apart from the recovery in the write-off accounts, our core fee income has also grown at 28.43% on a Y-o-Y basis. The profit before tax has been -- has shown a growth of 53.65% and stands at INR 295 crores. However, the net profit has declined by 32% to INR 189 crores. And the important point which I'd like to mention here is that the decline in the net profit was also due to some of -- one of the write-back on tax that we got of INR 85 crores in Q2 last year. So therefore, the net profit on a bottom line basis has gone down to -- by 32%. Our gross NPA has been reduced by -- to 6.23%. Net NPA has come down to 1.88%. This has been aided by good recovery and upgradation of INR 594 crores and of course, a good recovery in the technical write-off accounts. In the -- on a sequential basis, we have also certain good improvements in the profit before tax, noninterest income, yield on advances, core fee income, our credit cost has come down and is now at negative 0.05%. The slippage ratio has been at 0.45%. The return on assets has improved sequentially by 9 bps. The net profit sequentially has improved by 23.53% on a Q-o-Q basis. The return on equity has improved to -- improved by 175 bps and the capital adequacy ratio has also improved by 4 bps. Overall, these were some of the basic features of our performance of Q2. And in this intervening period as far as the technology part was concerned, the bank has now improved -- upgraded its technology platform from the core banking Finacle 7 to Finacle 10. So it will give us a lot of now leverage for improving our technology-driven growth and improving our skills and underwriting standards and monitoring mechanism. So once the core banking Finacle 10 stabilizes, we expect that we can bring -- use this -- leverage this technology platform to build in new methods of lending, new methods of governance, new methods of underwriting and I'm very sure that those developments will now get a boost. We were waiting for this big leapfrogging in our technology area and our digital platform will also get a great boost once we have been able to stabilize this basic platform. So these were some of the basic highlights of our performance of Q2. Now I will -- now the floor is open for the questions. Shilpa? Thank you.

[Operator Instructions] So our first question is from Mr. Amit Mishra.

Amit Mishra here. I'm from Indus Equity Advisors. And my first question is on your loan gold portfolio, it has grown by 45%. So can you talk -- year-on-year, 45%. Can you talk about the asset quality and yields whatever we are getting?

Yes, the gold loan portfolio.

Yes, Ravi Mehra this side. Yes. Basically, we are focusing on the gold loan portfolio recently that first of all, our base was small last year. We have recently introduced this product just 1 year back. And specifically focusing on this gold loan portfolio, reason being that's a capital-led product, and our stress is very minimal in this gold loan portfolio.

The NPA percentage in this is only 0.2% in the gold loan portfolio.

And do we have any targets like in retail, we want to achieve this much of gold loan portfolio particularly?

No actually, we are targeting a growth of somewhere around 40% to 45% growth during this financial year.

Okay, okay. And yields, sir? Yields on this portfolio?

It's somewhere around we would say 9%, somewhere.

9%. Okay. Sir, your cost-to-income ratio has gone up significantly as compared to last year. So it is somewhere around 72%. And last year, it was around 65%. I can see there is increase in employee cost. Can you talk about that why it's increase, a 10% of increase?

Yes, as you rightly said, some of the market factors, of course, also, which is impacting the cost-to-income ratio is the treasury yield movement. You must have seen in my presentation that there has been a depreciation of -- MTM depreciation of INR 25 crores during this quarter, which also has impacted my cost-to-income ratio apart from the repricing of the various retail term deposits that are happening that's the industry phenomena, we are seeing a migration from the CASA to the retail term deposits. And that's a liability franchise, we need to protect also. So therefore, we -- our deposit growth has been over 10%. If you have seen our deposit growth has been over 10% in Q2. So some of the repricing impact of our liability franchise is impacting the cost. So the cost of deposit has increased and the MTM depreciation of INR 25 crores, that is an addition that -- in this quarter, which we hopefully going forward will get rectified in 1 or 2 quarters as the market scenario moves.

Okay, sir. Sir, what will be our exit NIMs and credit cost for whole year? If you can give us some guidance.

The credit cost, of course, was a negative 0.05%. We will continue to maintain the credit cost at below 1%. That's the overall -- because what we find is that, the stress in the segmental -- corporate segment is virtually barring 1 or 2, which are sometimes government accounts, which are here and there that's SMA-1 or 2. But overall, the corporate scenario looks pretty sound at this point of time. We had a stress -- residual stress still having -- in our portfolio in the RAM segment, particularly in the agriculture and the MSMEs. As far as agriculture slippages, you must have seen that our agriculture slippages this time was a bit higher than what was last year. So because of a geographical skewedness in our branches particularly in the northern belt of the country, we had this residual stress. However, we feel that most of the residual stress in the -- particularly in the agriculture segment, has somehow stabilized or has been recognized. Therefore, the credit cost overall, we will be able to manage it below 1%. And as far as the -- the other question was regarding the NIM. The NIM, yes, it is under stress. And we are at 2.32% in the quarter. Therefore, there will be some more -- maybe another quarter impact on the balance sheet in Q3. But going forward as our MCLR, because we also have revised our MCLR significantly, and those impact will be coming in the coming quarters, maybe from Q4 onwards. So that will be addressed in the Q4 results somehow. And therefore, on the financial year side, we'd like to keep it anything between 2.30% to 2.35%, that would be our range in which we are looking at as far as March is concerned.

Okay. Sir, last question from my end. As you mentioned that repricing will kick in from next quarter. As I can see, your yields on advances increased in 1 year by 100 bps, but your deposit -- cost of deposits increased by almost 120 bps. So right now, it's at 5.6%. Do you see any increase in cost of deposits from here?

Yes, there will be some marginal cost -- incremental cost that will be added up. See, you have to look into the perspective of Punjab & Sind Bank's overall legacy. We are a bank which has a low CASA ratio. And we are not in a spread all over the country. So the pressure on our portfolio and on the low-cost liability resources has been -- as an issue which has been for a long time with the bank. We are trying to address this issue in multiple ways. First of all, we need to protect the existing liability also. So that's why we are also in the market in -- trying to mobilize the retail term deposits. At one point of time, we were losing the retail term base also on the deposit side. And what we find is that the retail term deposit, though it is adding to my cost. But overall, my base of -- my customer base is getting retained, and that's why my retail term deposits is growing over 7% or nearly 8% at this point of time, which were also not happening previous 2, 3 years. We were losing on the retail term base also. So there will be some -- and the repricing that happens along with the market scenario that will continue to have some more impact on the Q3 numbers. So we expect a marginal shift in the cost of deposit. But overall, going forward, we will be able to -- as our MCLR repricing resets start happening, I think we'll be able to manage that part in the next coming quarters.

Our next question is from the line of Ashok Ajmera.

Sir, my first question generally in our bank is directed to the credit growth sir. Actually, we have been talking about it. We have a very small base of some INR 80,000 crores INR 81,000 crores, but still in spite of all the assurances and also -- I mean, even based on the underwriting standards and everything, somehow, we are not in a position to grow the way a bank of our size should grow, past legacy is there. I mean, that is okay, in the gross NPA net you can have some issues with the recoveries also. But on the -- what is stopping us to really think little out of the box and go for some good sizable increase in our credit portfolio? If you look at it, in the last quarter, it was INR 80,982 crores now INR 81,906 crores, even the corporate book, which was INR 40,391 crores, now is only, again, INR 40,386 crores. So as a bank, I mean, what is actually -- I would like to have your comments on that what you think over a period of time of, say, 3 months, 6 months, 1 year, 2 year, where do you -- how would you grow your book? And whether you -- do you have any intent to grow it?

Yes. So can I answer? Or you have some more questions to ask?

Sir, this is very important, and then I will take other -- some other questions also sir.

Okay. We appreciate your concern, Mr. Ajmera, on the credit growth. Let us try to put the perspective in a proper manner. I mean from March '18 to March '22, the bank had a lot of issues, and we had to rebalance our portfolio in terms of various capital constraints, et cetera, and the bank came out with certain measures, which resulted in a turnaround in the bank and the bank's gross NPA had shot up to as much as 14% plus at one point of time. So in a bank of our size and geographical reach, the bank in its prudence had decided to shift gear in terms of moving towards a different way of lending. While I appreciate the point that the bank is not growing in -- as per the expectations of the stakeholders, but let me put this also in a proper perspectives that, first of all, the bank intends to grow. There is no doubt about it. Number two, the bank intends to grow qualitatively. Number three, the bank has a constraint of growing its book aggressively regarding the cost of resources that we bear. As you -- there is no point in growing the book if my cost is not covered in my portfolio. Therefore, as a bank of our size, neither we have the market dominance to dominate the rate of interest that is being asked for by the corporates and PSUs. So we have a constraint there, and we are willing to sacrifice our book if we do not get the returns accordingly. The banks of other bank -- the other banks which are able to grow have that advantage to grow much more aggressively than we can grow. We can understand the -- in -- and if you increase the book size, we have increased the book size, so we have increased the last year, if you see the quantum jump that happened last year in '22, '23, where we've done a 15% credit growth compared to what we have been doing in the last 5 years. So I think the stakeholders will appreciate the point that there is an intent to grow. But when the market scenario moves in a reverse direction in terms of the policy rates, in terms of the global dynamics that happened, the bank of our size need to rebalance very quickly. Otherwise, going forward, the bank, again, can get into a recycled mode of what happened in the previous past 3 years at least in terms of efficiency. So we would like to maintain our efficiency parameters in the foremost in our minds while we do our business. And accordingly, we will pace ourselves. When we found that the repricing was happening very aggressively, now I cannot deny my retail franchisee the cost, the deposit rate of interest we deserve to get in terms of market. So I should get an equivalent sort of yield from my advances. So therefore, we need to grow our RAM book very strongly instead of the corporate finances. And if you see in our presentation, this also, the corporate finance has increased 12% Y-o-Y, which is not a very bad figure in terms of what the market trends are. So there is an indication that we need to grow, but we need to grow with the high yielding advance ratio. So there's a balance that needs to be done between how much we can grow and at what cost. Accordingly, we are framing ourselves. So we don't mind at this point of time to sacrifice a bit of growth if it doesn't encourage my profitability and my ratios on the bottom line ratios. So we are expecting to -- we are -- and remember one more thing, we were having some technology constraints which were giving up -- which were halting our development in terms of creating new ways of lending. So now that we have done our Finacle 10 upgradation. We are in a position and are patience to now bring those enablers in the market for the bank as available in the market. So we can lend faster, our LOS systems, the loan origin systems will be faster. Our underwriting skills will be much better strengthened. And of course, that will help us in our digital acquisition of customers on the lending side also. So we have a host of plan, which we need -- which we will implement, and we will progress as the banks -- as per the bank's risk appetite and as for the bank's strategic thought process.

Point well taken, sir. Now you see with the digital journey also, as you said that, yes, we are late and it took a lot of time. But there is a lot of opportunity other than that online acquisitions and other things for the SME and even some mid cap space also. But anyway, I mean, that is one thing which will keep the bank going as well as the profitability increasing because even with this 10% or 12%, you are talking about in the last 2 quarters, where do we stand? So it means on the remaining 2 quarters, I hope you will try to do it because if you compare with the last whole year to now, but I compare it from the 1st April '23 to now So it means in the next 2 quarters, according to you, there will be good credit growth, which will take care of about 10% to 12% of the growth in the whole year.

Yes.

Point is well taken. So you only, sir, touched upon this digital journey. Whereas many of the other banks, even the small or big banks also have come to a very good stage. They are explaining there is so many journeys they have been undertaken out of that so many models or modules are already ready put in the practice started giving the results. So in our case, what exactly is the situation? Like how many such journeys we have completed or we have put in practice? And whether -- what kind of business has already been started generating? Or if not, then what is the time line now?

Yes. So a very good question. First of all, I appreciate the point on the credit growth that you raised, and we will take care of your suggestions, and we will imbibe in our strategic thought process. Number two, on the digital transformation, any digital transformation of the banks that you must be seeing in the industry now was based on a strong technological platform. Digital, it sits on a technological platform. So the constraints that we had, we were struggling to bring those journeys as we wished we would like to bring and try -- and because they earlier -- sorry, the earlier version of the Finacle was not enabling this process, so now we have done it in October itself. We have given an announcement that the Finacle upgradation has happened it requires some stabilization. You all appreciate that, that any such big upgradation project goes -- requires some stabilization. But thankfully, as of now, we have done it very smoothly. There are certain back-end issues, which we are resolving very soon one by one. So maybe within a month or so, we are in a position to completely stabilize the process. And we have already created journeys which we think can be immediately implement it. One such journey, of course, was the preapproved personal loan, which we already have done it in the earlier version, which will now get a bigger what you call leapfrogging in the upgraded version. So the preapproved personal loan category is in -- one of our main area. We like to bring these categories -- such category of loans into our mobile journeys in other areas also like gold loan, like other personal loan, and any other schemes that we think can be -- we're also working on the fintechs to collaborate with fintechs. The fintech collaborations are at a very, very advanced stage. And we think that with the fintech collaboration, particularly, we are not doing so well in agriculture. So we are now focusing on fintech collaborations for agriculture segments which we can get -- generate business out of that segment. We are tying up with -- we are talking with big universities like in Punjab because we have a predominant base in Punjab. We are talking one of the most top most universities in Punjab and tying up with them so that we can think of something on a collaborative effort because they have a lot of research work that they do. And we intend to collaborate with them and bring it to the table so that we can bring it to -- as part of our strategic thought process in increasing agriculture business. So journeys will be, let's say, another on the acquisition side, one of our constraints that we faced on the CASA acquisition because today, most of the banks on their mobile app journeys are also giving a host of journeys on the liability side for customer acquisition. So now on the -- particular on the current account area. So we are now in a position to bring those -- of -- methods of customer acquisition for our bank. And we expect the other by December end year, max to max January end, we'll be able to develop those processes so that we can bring more and more customers in our fold. What we found in our various interactions with the customers that we have a very great loyalty quotient of customers in our bank. But because of the technology constraints, many of the customers are not banking with us, they are only maintaining account, but maybe they are doing their business, main business with another bank or private or a public sector. So that we would like to reverse now and give our own customers the platform, which will enable them to do transaction with us, which will ultimately build opportunities for cross-selling, opportunities for various other methods of banking services. We also now are now brought in the business correspondence. We have already initiated the process. We intend to -- we have already increased the number to nearly 700. At this point of time, we intend to bring it up to 2,000 by December and another [ 4,000 ] by March. So on that perspective, also the -- many of our activities will get outsourced through this, which will also help in customer acquisition. And there is also a technological integration here, which will also be done on the onboarding of the bank business correspondence under the corporate PC model has been initiated. So we are increasing it very rapidly. So these are the -- some of the enablers that the field will get to acquire more and more customers. And once my digital -- we have -- what we find in our bank that this omnichannel digital app that we have, which we call when PSB UnIC is itself a unique app compared to many other banks. We were not able to leverage this because of the technology platform. It's a unique omnichannel experience, both on the net side -- on the net banking and on the mobile, many few banks -- only a few banks are having this in the market. So now, as I said earlier, at the cost of repetition, that once this sort of technology gets stabilized, we are going to bring in more and more value-added products under this area, which will enable the bank to -- on a digital transformation. But overall, any transformation on the digital transformation to answer to your question, specifically on the timelines, I think any digital transformation it takes about a year or so, so the period what we are looking at on a transformation perspective, is March '25.

Okay. Sir, very promising and very elaborative statement. Just one more in this round. Sir, our recovery in this quarter is good. The cash recovery is also good and the recovery in written-off account is also good. So can you give us some color for the overall year on the recovery front, I think our recovery target overall was INR 1,500 crores this year. And coupled with that, on the other side of the asset quality, our SMA-2 book has been -- have increased in this quarter to INR 407 crores as compared to INR 310 crores. So just these 2 questions, if you can.

Yes. Yes. Our recovery upgradation target, we've maintained at over INR 1,500 crores. We have some big resolutions in the offering in Q3 and Q4. So we are very confident that target will be easily achieved. So there is no doubt about that part. As far as your SMA, yes, you are absolutely right. One of our [ mid ] segment accounts on the real estate front, INR 106 crore account, has temporarily slipped to SMA-2, we are confident that it will not slip and we are going to bring it back to the fold, there are certain resolutions in the -- which we are planning on this account. And otherwise, overall, the book seems to be on a controlled environment. One account of course, that's a legacy account which we declared in the notes to accounts standard -- NPA account, which is declared standard. And there is, of course, a government account, which is state government guaranteed account which sometimes go into SMA-0 or 1 and 2, it moves here and there. So apart from that, we don't foresee too much of an issue. Therefore, our recovery upgradation target will remain more than INR 1,500 crores. I'm very confident that we are going to achieve those figures. And the slippages, if you are actually hinting at what would be the expected slippages for the current year. Overall, we feel that we'll be able to maintain the slippages as -- at the level of last year, which was around INR 900 crores. So we -- annual basis -- on an annual basis. So that is what we expect to keep it at level.

So you mean to say on slippages, I think in the last 2 quarters, we already have INR 791 crores. Isn't it?

Yes. But if you see the half year figure, that slide that shows a half year figure, which is at INR 563 crores, I think.

Yes. Yes.

So the half year figure is INR 563 crores. That means what? What has slipped in June quarter, we were able to recover very aggressively in September. So that's the...

Can you repeat the half yearly figure, sir?

Yes, INR 563 crores. It's in my slide number...

Okay. Okay.

I'll just tell you the Slide #17. Please see, Slide #17.

Okay, sir. So it means that the...

It is INR 653 crores, my mistake. Sorry, it is INR 653 crores, yes.

650...?

3, half year.

INR 653 crores.

INR 538 crores was last year, sorry, I got...

So the net effect for the next 2 quarters -- in the next 2 quarters, maybe around INR 250 crores to...

Net, net, yes, that's what I'm saying net, because some of what has been slipped in September has already been recovered in October. So this trend continues. So the net, we expect slippage minus recovery another INR 200 crores, INR 250-odd crores.

So this one construction account of [ INR 106 crore ] you don't expect to be slipped? Hello?

Apologies, sir. I would...

No, just continuation of my...

Apologies, sir. I request you to please rejoin the queue for additional questions. Sir, we will move on to the next question from Mr. Amit Mishra. I think his line has got disconnected. Sir, I have a question on chat from Mr. Bimal Panchal from Bimal Panchal and Associates. His question is, has management received any communication or indication from President of India, promoter of the brand regarding any dilution of their holding?

No, not yet.

Our next question is from the line of Mr. Sushil Choksey. Sir, we're unable to hear you. Sir, I think Mr. Sushil's line is having some issues. We will come back to Mr. Ajmera for his additional question.

Yes. So continuing our discussion earlier, sir, we were talking on the -- hello? Can you hear me?

Yes, yes, please. Carry on, Mr. Ajmera.

Yes. We were talking on the slippages and you said, yes, this is under control and on the net-net, it maybe [ INR 250] crores to INR 300 crores. Does it mean that -- I mean, you are sure that the INR 106 crores construction account, which is in SMA-2 will not slip only?

That's what we are confident about, yes, yes. It's a project under implementation. I think the last mile activity is going on in the implementation. We are expecting that some resolution, at least on the -- will happen, not a resolution in terms of restructuring. I'm saying in terms of bringing the account back to its normalcy. I'm talking of that resolution, not a restructured resolution, I'm saying. So some sort of thing -- we are very sure that it will not slip, we're able to maintain it, at least SMA-1 and 2 category to move on until the project gets completed. It's a real estate project, housing project, which for some reason got stagnated. Now the production is going on. It will end at some point of time. And once the project is completed, I think the revenues will come in.

Okay, sir. That's good. Sir, some -- a few things on this profitability, like wage revision provision, where do you stand? Have we provided for fully or -- what it is the status there...?

We're providing at 12% now.

Pardon?

12%.

12%. Okay, sir. Sir on this...

And one more thing, Ashok Ji -- and this is for everybody because you have raised the issue of the provisions, I can just add here, which I forgot to tell in my opening remarks. In this balance sheet also, we have provided additional INR 80 crores towards waging provisions and some other accounts. So overall, we are building up the provision coverage. So we are -- already for the December quarter, the waging provision has been provided in this September itself. And we are also building up -- we also provided another INR 40-odd crores in certain accounts. So overall, we have provided more than INR 80 crores additionally in this quarter on the NPA side, apart from the wage revision of 12%. Yes, please carry on Mr. Ajmera.

Sir, on this other operating expenses, of course, I didn't see that slide in detail. But it has gone up comparatively to the last quarter from INR 206 crores to INR 251 crores. Any special account where we...

If you see in the same slide, Mr. Ajmera, I'd just like to bring your kind attention to the same slide on the half yearly figures, you will find that other operating expense has actually gone down by 3%. So this happens in a June quarter -- sorry, in September quarter. But overall, if you see on a half yearly basis, the -- many of the expenses are actually booked in the September quarter due to some routine expenses that are getting booked. But if you see our half yearly Y-o-Y that has gone down by 3%. I think that is the comfort that we draw.

So sir, on this technology front, the digital journey and this thing, they are generally -- how much of the -- what is the percentage of the CapEx and P&L? Are you putting something more to the P&L, some part of this expenditure?

See, there are 2 parts of any technology expenditure. One is the capital expenditure, one is the revenue. So far, we have been -- on the technology upgradation in terms of putting -- bringing the software -- sorry, hardware, et cetera, and we had a plan of around INR 250 crores of investment in the -- like which were projected there. And accordingly, we have invested there on the capital side. Now that the revenue as the AMC will start from now onwards, as we have moved into the implementation. So some sort of revenue expenditure will continue to occur in terms of this technology upgradation, but which is a balanced figure which we can make up. It is not a big deal for the bank.

Sir coming back to -- I think you had given an answer for this lower NIM to 2.32%. So can you a little -- I mean, where do we see our NIM to be? And what could be the -- how can we increase the NIM? Which are the composition on which you are working of the various like the lag effect on the whatever is your rates and everything. So -- so is there any calculation done for the NIM? And where would we be at by the end of this year on the NIM?

See, as I said, I've already given this figure, we'll be trying to be at anywhere between 2.30% to 2.35% by the end of the year. And as to answer your specific question on where this NIM will improve, yes, we have identified the assets particularly see corporates, we cannot compete. Let us be very honest about our position in the industry. PSUs are -- our asking rates at much below the rate which I cannot tell you here in the open market, but you all know what is the demand from the PSUs in terms of the rate war that is going on in the market. So we are not there. We have tried something. We thought that we can increase the book on that side. But however, we find that it is not getting cost effective. So we have retraced our steps on that. And now we need to go into those areas where we are getting higher yields. And so the main focus, of course, would be RAM. And we have been increasing the RAM if we increase the onward lending to NBFCs, if I -- if you see that slide, it has increased to over 53%. So that is where my yields will come from. We are also improving our core lending. We have already increased the book to INR 1,500 crores. At this point of time, we are going to increase it further. We intend to bring it to around INR 3,000 crores by the end of March '25 -- '24, March '24. So the core lending will get a traction. We are preparing our technology platform for pool purchase. So once that happens, we'll have a traction in that area also. Maybe a bit more time is required in terms of the technology setup that requires to be done. So then we'll focus on the gold loans, the personal loans where we get better yields out of that. The MSMEs, of course, again, is a big focus. We have increased our GST product, which is on a cash flow based, we are providing up to INR 5 crores. So that is giving good traction on the -- on that product, and it's a very popular product in the bank. So we expect that the yields will improve in that area. So we have internally strategized on various segments, how much to do it for housing, how much for vehicle, personal, education, gold. So internal targets are fixed, so that it all impacts my NIM. But because of the interest rate sudden that has happened. See, we were all expecting a repo rate cut happening sometime this year. Now we all know what are the circumstances in which we are in and how that gets -- is getting delayed. So that factor is also impacting us. So if -- we had factored in a bit that in Q3 or Q4, we'll get a rate cut benefit, which will impact beneficially the bank's overall balance sheet. But because of the global factors and the factors of international standards, of the multi policy committees, there has been a delay in what -- how this -- that the rate cut was going to translate in India, we are moving into a prolonged pause now. So again, we need to just hold our horses and the MTM depreciation has happened, the another war situation has created -- it -- has been created in Europe that is also impacting in some way, the various decisions that need to be taken. So these are some of the global factors that also impact a bank and a bank of our size and balance sheet, the factors get a bit of aggravated in that fashion. So we are confident that this year, though, we will try to improve our credit growth, but in terms of the various factors on the low-cost liability resources maybe we are looking for a better year ahead. When the market also helps us with the treasury, the treasury will also rebound, I'm very sure from Q1 next year, which we are expecting, some traction will happen. So once that traction happens and the treasury also supports the bank in the way it has supported earlier, we can have a better -- much more better performance in next year, '24, '25.

Yes, sir. Sure, sir.

Sir, apologies, may I request you to please rejoin the queue. Our next question is from the line of Mr. Sushil Choksey from Indus Equity.

Can you hear me please?

Yes.

Sir, your voice is echoing.

One minute, one minute. [Technical Difficulty]

There is an echo.

No, no, I joined from 2 instruments so I just made shift. Sir my first I had a good history class about Punjab & Sind Bank...

We cannot hear you.

You can't hear? One minute just hold on, just hold on...

Sir, we cannot hear you. May we request you to please [Technical Difficulty]. Sir, please give us a minute please.

[Technical Difficulty]

Mr. Choksey, we cannot hear you. The sound is echoing again. May we request you to please paste your question on the chat so that I can ask it on your behalf. Mr. Choksey, can you please message us or WhatsApp us your questions on 7907431859? Apologies for the inconvenience. Thank you for the hold up. Thank you, as we are unable to get in touch with Mr. Choksey. With that, ladies and gentlemen, as there are no further questions from the participants, we now conclude this conference. Should you have any further queries, please reach out to Ms. Mamta Samant at 9930625104 or [email protected], details are mentioned in the Webex chat and the analyst invitation sent to you earlier. On behalf of Punjab & Sind Bank, I thank each one of you for joining the press -- for joining the conference today. You may now disconnect your lines. Thank you, and have a good weekend.

Thank you, all.