State Bank of India ($SBIN)

Good evening, ladies and gentlemen. I'm Pawan Kumar, General Manager, Performance Planning and Review Department of the bank. On behalf of State Bank of India, I'm delighted to welcome the analysts, investors, colleagues and everyone present here today on the occasion of the declaration of the financial year '26 results of the bank. I also extend a very warm welcome to all the people who are accessing the event through our live webcast. We have with us on the stage, our Chairman, sir, Shri C.S. Setty; our Managing Director, Corporate Banking and Subsidiaries, Shri Ashwini Kumar Tewari; our Managing Director, International Banking, Global Markets and Technology, Rana Ashutosh Kumar Singh; our Managing Director, Retail Business and Operations; Shri Rama Mohan Rao Amara; our Managing Director, Risk Compliance and, Ravi Ranjan; our Deputy Managing Director, Finance, Anindya Sundar Paul, our Deputy Managing Directors heading various verticals and Managing Directors of our subsidiaries are seated in the front rows of this hall. We are also joined by Chief General Managers of different verticals business groups, Chief General Managers and other senior officials of the circles and various offices are connected through our live webcast. To carry forward the proceedings, I request our Chairman sir to give a summary of the bank's financial year '26 for performance and our strategic initiatives undertaken. We shall thereafter straight away go to question-and-answer session. However, before I request Chairman, sir, I would like to read out the safe harbor statement. Certain statements in today's presentation may be forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual outcomes may differ materially from those included in these statements due to a variety of factors. Thank you. Now I would request Chairman, sir, for his opening remarks. Chairman, sir, please.

Good evening, ladies and gentlemen. Thank you for joining us for today's analyst meet following our Q4 and FY '26 results. At the outset, I would like to state that our FY '26 performance reflects consistency born out of a calibrated multiyear shift in how we run the bank. We have focused on strengthening our core fundamentals of asset quality, capital, operating efficiency and franchise depth. The result is a balance sheet that is performing robust and resilient. Let me briefly touch upon the environment we are operating in. The global economy remains in a phase of elevated uncertainty, with growth projected by the IMF at 3.1% in '26 and 3.2% in '27. India, however, continues to outperform with FY '27 growth projected at 6.9% by the RBI supported by domestic demand and macro stability. That said, geopolitical developments and climate-related disruptions remain key risks. Inflation is expected at 3.8% in the near term with a full year estimate of 4.6% with some upward bias on account of energy price movements and weather-related uncertainties. From a banking system perspective, credit growth for the scheduled commercial banks accelerated to 16% in financial year '26, while deposits grew at 13.6%. The momentum is continuing in the current financial year, and we expect accretive growth at 13% to 14% and deposits at 11% to 12% for FY '27 for the system. Asset quality continues to remain strong and the capital buffer is comfortable. However, beyond these metrics, the operating landscape is being reshaped by deeper structural shifts technology risk is now becoming a systemic risk. The emergence of advanced AI models capable of identifying and exploiting vulnerabilities at scale has fundamentally changed the cybersecurity paradigm. The industry is, therefore, moving towards coordinated system-wide resilience frameworks in partnership with the regulators, the government and other key stakeholders. At the same time, the regulatory approach to risk is becoming more forward-looking. The transition to expected credit loss base provisioning from April 2027 is a significant step in that direction and we are confident of a smooth transition. In this environment, our approach is focused not merely on growth, but improving the quality of our growth by making it more durable capital efficient and more resilient across cycles. This is being executed through a set of aligned actions. We are simplifying the bank at scale through Project Saral, which I mentioned earlier with you, our operations process reengineering initiative. The larger objective is to simplify the customer journey and release capacity within the system to focus more on relationship building and business growth. Second, we are building a more digital native intelligence-led organization through Analytics 2.0. Data and AI are becoming central to decision-making across credit, risk and customer engagement. Third, we are strengthening our liability franchise as savings increasingly shift towards market-linked instruments. We are deepening customer engagement through YONO, expanding ecosystem partnerships and creating relevant offerings for diverse segments. Our balance sheet strategy is moving from volume-led expansion to a value accretive growth with a sharper focus on granularity, product competitiveness and risk-adjusted returns. We are also expanding into new growth areas, including start-ups, alternative investments ecosystems and global trade to keep our portfolio diversified and future-ready. Against this backdrop, let me now highlight the bank's Q4 FY '26 performance. Driven by strong operating profitability and improved asset quality, I'm glad to share that the bank has surpassed key milestones this financial year. Net profit reached a record high at INR 80,032 crores, up 12.88% year-on-year, supported by 11.25% year-on-year growth in operating profit. The domestic NIM at 3.03%, supporting our guidance to maintain NIM above 3%. As total business crosses the INR 109 trillion mark, this performance showcases our strengthening market position and sustained customer trust. Our domestic business has grown by more than INR 11 trillion on a year-on-year basis. Our balance sheet size has crossed INR 76 trillion. We achieved resilient deposit growth of 11.03% year-on-year by about INR 6 trillion, driven by strong inflows in retail term deposits, which grew by 14.77% and a double-digit savings account growth at 10.6%. Despite competitive environment, a 39.46% CASA ratio, which is an improvement of 33 basis points quarter-on-quarter, sustains our low-cost funding advantage reinforced by 12.7% growth in foreign deposits. The credit growth has been robust and was up 16.87% year-on-year as of March '26, which was driven by all the segments registering double-digit growth. The domestic credit deposit ratio was 73.08% at the end of FY '26, an improvement of 37 basis points year-on-year. All the components of RAM have witnessed sound growth. The corporate credit momentum continues and grew by 14.8%. Our foreign offices have continued to perform well with growth in advances at 20% year-on-year. In dollar terms, it is 8%. The asset quality continues to be industry-leading with gross NPAs at 1.49%, improving by 33 basis points and net NPA at 0.39%, further improving by 8 basis points on a year-on-year basis. The PCR was at 74.6%. The sustained 2 decade low in NPAs validate our rigorous underwriting capability, disciplined credit practices and effective credit risk management. Strengthening our capital position, our CIR has improved by 115 basis points year-on-year and stands at 15.4%, which is well above the regulatory requirements. The bank has enough headroom to address future credit growth requirements. Further, our subsidiaries are demonstrating consistent performance and are driving stakeholder value through digital expansion, product innovation and improved customer experience. We will continue to nurture these subsidiaries and see them creating value for their own shareholders as well as the shareholders of SPI. At SBI, digital transformation remains a continuous journey, where YONO is central to our strategy. The strong adoption of our new YONO crossing 4 crore registration within 3 months of launch and bringing total uses about 10 crores conforms that digital-first banking is now deeply embedded in customer behavior. 66% of new savings accounts originating on YONO platform in FY '26 demonstrates our successful transition to a digital-first institution. Our FY '26 performance reflects both a strong foundation and the strategic repositioning in an environment of intensifying liability competition, evolving customer expectations and rapid technological change, we are reshaping our balance sheet, strengthening liabilities, embedding AI and analytics into our operating model and diversifying funding sources and growth ecosystems. Our focus remains firmly on delivering consistent risk-adjusted returns supported by disciplined underwriting, strong asset quality and robust internal capital generation. Our emphasis has always been on efficiency and written metrics with our ROA consistently greater than 1% and ROE at 18.5% at the end of Q4 FY '26. Our ability to maintain an ROA greater than 1% at scale puts us in a top league of global financial institutions with an advances book of more than INR 49 trillion, investments about INR 18 trillion, deposits of more than INR 59 trillion and a balance sheet size of nearly INR 76 trillion. Most importantly, we are empowering our people with continuous training and inclusive culture to build a motivated future-ready workforce in this dynamic environment. To conclude, we see SBI journey as closely aligned with India's long-term economic transformation. As the country progresses towards the vision of Viksit Bharat 2047, we believe SBI has a unique role to play as a key enabler. Thank you once again for your continued engagement and support. My team and I will now be happy to take your questions.

Thank you, Chairman, sir. We now invite questions from the audience. [Operator Instructions]

Yes, sir, definitely complements to you, sir, for such a robust business growth, very good asset quality. And if you see on year-on-year the highest operating profit and the net profit, net profit going beyond INR 80,000 crores. There is only a few concerns looking at the results on the face of it of this quarter, where our operating profit also has gone down and the net profit also has gone down yet compared to the last quarter. And mainly direct -- the profitability dragged by the treasury operation, the loss in the -- maybe a trading loss or a loss on the valuations of the treasury book, I think, which is about INR 3,500 crores and a little bit increase in the overhead expenses in this quarter which may be because of the last quarter, it has gone up by about INR 1,500 crores, INR 1,700 crores, the overheads. So having said that, our slippage has also gone up a little bit in this quarter, maybe INR 1,000 crore, INR 1,200 crores, up in this quarter. So in this scenario, now with the treasury outlook looking a little better in the coming quarters and overhead may be onetime because of the last quarter of the financial year, can I -- can we have some idea of going forward, where do we stand on the profitability front? While the loan book is growing very well, but you, yourself said that we can look at still about 14% to 16% growth in the credit book. So looking at this scenario, now coming forward, can we have the comfort of having, if not good income from treasury, at least the losses are not there, so that the overall profitability increases? And coupled with that, now with the ECL guidelines getting finalized, how are we prepared with that? Is there impact is going to be taken up in the coming quarters, whether the numbers have been drawn? And what is our plans to take care of those provisions vis-a-vis now as far as the business growth is concerned, with the emergency line of credit guarantee scheme 5 coming up with INR 250,000 crores, INR 5,000 is for airlines separately. So even business growth, yourself have said in some of the interviews that INR 70,000 crore, INR 80,000 crores of prospects are there only through this line of credit, looking at your customer base. So in all, can you just give your views on the few points which I have raised in this space.

Ajmera sir, you said a few points, is it, okay, but very comprehensive assessment, what you've done. First of all, I think a few questions which are in your mind. Let me first answer them in terms of -- there seems to be some amount of -- maybe we were not communicated enough in our Q3. I believe I've gone through my transcript again in Q3 analyst call. We made it very clear that our exit NIM is going to be 3%. And we also mentioned that in the Q3, December 15 repo rate cut will be having full impact in the Q4. And these things are something what we stated upfront. What has not been known to all of us is the yield movement, which had definitely impacted the treasury income. But even then, what we realized that despite the sharp movement in the bond yields, because of our very low exposure to fair value portfolio, our hit has not been very significant. But you are comparing with the Q4 of the previous year, for instance, we've had INR 3,800 crores onetime gain on the security receipts. Apart from that, we had positive treasury gains in that quarter. I think overall, we all believe that we have given a good set of numbers for Q4 as well as full year. And we stuck to our guidance in terms of 1% ROA and a 3% exit NIM. I don't think there was any surprise to us. But I think there is some assessment in terms of what analysts like you have done on the NII part. There are 2 reasons why the net interest income has got impacted. As I mentioned, one is the impact of 25 basis point rate cut, which is reflected in the EBLR portfolio, and 5 basis point cut which we have done in the MCLR is fully factored in the Q4. And the EBLR book also has gone up. In fact, the composition of the floating rate loans slightly has increased. That also is a combination of factors which we had known. And that is the reason we always gave a guidance that when we talk about NIM, we are not talking about on the quarterly NIM numbers. It is a full year exit NIM, which we have given the guidance and I hope that we broadly fulfilled that. I think this is something what I wanted to clarify. And as for the treasury going forward, I think 3, 4 questions which you asked, let me answer in the serial items. One is slippages. Slippages of -- Q4 slippages is not a matter of concern. And we have -- from these slippages, we pulled back almost INR 850 crores as we speak. That means there is no structural issue in terms of asset quality. Let me assure you on that. So there's no impact of West Asia so far. And this slippages has nothing to do with any stress in the system. It is seasonal. Most of the slippages have come from agriculture and some from SME. I will give further guidance as we speak in terms of slippages, but we are sticking to our credit cost guidance of 50 basis points. Even despite whatever happens on the West Asian conflict, we are confident that asset quality will hold unless, of course, there is something dramatically happens in the system and macros will further get disturbed. As things stand now, we are sticking to our credit cost guidance of 50 basis points. Our credit growth guidance of 13% to 15%. And you mentioned about treasury income, and we believe that the yields will not create much pain going forward, even if assuming that the yield movement will be there, our internal guidance, which has gone wrong earlier, we felt that the bond yields probably would be moving up to 6.75%. There has been a sharp movement. But now also our treasury holds a view that it would be in the range of 6.75% to 6.9% million not beyond that, unless the West Asian conflict or any other fiscal imbalances create a problem. ECL guidelines, before ECL guidelines, let me also talk about ECLGS, which is a proactive and preemptive measure in my view. A lot of people ask me, are there any customers who are coming and asking for ECLGS? Not yet. It will take about 8 to 9 days -- 8 to 10 days for us to operationalize these guidelines. And we are reaching out to customers in case of any need they have this facility available. My assessment of INR 70,000 crores to INR 80,000 crores is the full limit, which is available to MSMEs and other non-MSME customers. But our assessment also indicates that not more than 30 -- in the worst case, 30%, 40%, people will be utilizing it. It could be more as the contract goes further but it is an excellent step from the Government of India side to make this available enough proactive measure. ECL guidelines, we have made the models ready based on the draft guidelines. We are further tweaking the models based on the final guidelines. It would not be appropriate for me to give a number at this juncture. I think probably after the end of June quarter, we will have much clarity in terms of what is the stock, which will create -- which is required to be taken care of.

Approximate you have about INR 29,000, INR 30,000 crores buffer already.

Ajmera sir, I don't want to hazard a guess at this juncture, let us stick to that. We're not going to give any number at this time. But one thing I want to make it very clear, as I made earlier also that this transition is going to be smooth. It is not going to impact our ability to fund credit growth. It will not be impacting our capital ratios as much and I hope we will be smoothly transitioning in the next 4 years in terms of the ECL guidelines implementation. I hope I answered all your questions.

So I had a couple of questions. Firstly, just on clarification in NII. We do not have any impact whatsoever of any ForEx translation or any ForEx loss. Because I remember years ago, in a COVID quarter, we had some NII issues relating to ForEx as well. So I just wanted to clarify.

No, it's a core NII, except that the usual tax -- interest on tax refund, which has come around INR 1,000 crores, which is added in NII. But it's partially offset because some of the penal interest, which used to be booked in part of interest has moved to penal charges. But that is just about INR 600 crores. It is purely the impact of EBLR and some of the floating rate loans on the corporate side.

Okay. So basically, the interest on tax refund is INR 10 billion versus around INR 7 billion last quarter.

I think it was INR 800 cores.

Yes, INR 7.7 billion, yes, INR 7.60 billion. Okay. And then, sir, just in terms of margins, right? So what is your outlook on margins near term and longer term as well? Because this quarter, we did see that NIM -- global NIM in the quarter declined around 18 bps. So what is the outlook going ahead? Maybe first half and then longer term also?

But I would like to give guidance for the full year, Mahrukh. And as I promised, I said that I'll give first year -- first quarter itself, the full year guidance. And we do not want to create confusion in terms of quarterly guidance. Because the quarterly in a large book like ours, there is a seasonality, there is a momentum of credit growth. It's very difficult to give a guidance on the quarterly basis. We are still giving a guidance on an annual basis. We are sticking to our NIM of more than 3% for the full year, for the full year.

Okay. Okay. So and if you could give the breakup of gross slippage for Q4 '26 and Q3 '26. So that's one question. And the other question I had is that what is your total Middle East portfolio? And what is the India-linked Middle East portfolio? Like some Indians working abroad, may have taken home loans, et cetera, so both if you could give some sense of that.

So I'll answer the second question first. I think that answers many people's minds what is happening on the Middle East. I see the Middle East, we have 2 large offices, Bahrain and DIFC, Dubai. But the other operations are very small, Bahrain retail operations and Dubai, we don't have any retail operations at all. So primarily, it is a wholesale book. And out of this, it is predominantly either a bank exposure or a sovereign exposure. And in both these cases, we do not see any concern on that. And we don't have any much direct exposure either to the medium enterprises at even corporates. So I don't see the great impact coming from the corporate side, wholesale book side. On the retail side, where the people working in the GCC, taking the housing loans, it is predominantly in Kerala, the rest of the country is not concentrated, but we have not seen any impact on the asset quality, particularly on the housing loans. They normally take housing loan. And a lot of people what we have realized that they have not come to Kerala back. They're still staying put in the place where they are working. And there is no asset quality concern at this juncture. And because -- most of the GCC countries are coming to a normalcy. We had moved our people from the GCC countries to India to work from Mumbai, but all of them have gone back now, barring a few, one or two, so which means that the things are stable. It will take some time, but I don't think it will lead to any concerns on the asset quality. The first question on the...

The slippage breakdown gross..

Gross slippages anyway, we don't ever give. It's always first quarter, which gives grass slippages and subsequently, it is all net slippages. But there's absolutely no -- any predominant movement of any concern in the slippages.

And sir, what will be that India linked proportion of portfolio, the Kerala home loans?

Very small.

What you said is right. Absolutely no concern as of now for us. The branches we have in Dubai and Bahrain, like Chairman said, this wholesale banking business, mostly we do -- and is mostly nonfunded business guarantee issue for Indian sent the defense and so the corporate book, what we have is 98% plus is either sovereign or banks or some related exposures. So we are not concerned about any corporate experience in Middle East for these 3 branches. Globally also exposure we have with India, total exposure will be INR [indiscernible] billion, including trade finance and , but we are not seeing any concern on that side.

Jai Mundhra from ICICI Securities. Sir, on your -- this FY '27 3% plus NIM guidance, that is domestic or the global one, just to clarify.

So our guidance is generally domestic we are not giving wholesale. I mean, full bank NIM ever. Because, see, the overseas book is a different creature all together. -- you're talking about domestic NIM.

And sir, within this, so let's say, there are 2 parts. One is yield and 1 is cost of funding or cost of deposit. If I calculate this quarter, right? So yield on interest on advances, they have been flat, 0.4% increase, whereas Advances have grown by 5% Q-o-Q. In last quarter also, they were 5%. So average basis also, they should be around 5%. So what explains the decline if I calculate this way, the yield on advances, they have declined by around 30 basis points. One is, of course, the repo rate movement. But apart from that, is there anything else which could linger because hopefully, the repo rate movement ends here, right? So what is your thought process on yield on advances going ahead? Would they be similar, stable and hence...

Yield advances probably would have some uptick. What happened in the Q4 apart from the EBLR moment, See, your EBLR floating rate loans in -- other than MCLR in corporate book was 43% previous year. It's moved to 49%. That movement also actually creates -- so assuming that we -- our house view is that the reported card is unlikely this year. Repo rate movement is going to be stable, which means that whatever we see on the spreads will remain and on the corporate side, we are seeing how we can change the asset mix and reduce the floating linked to T-bill essentially and bring back the yields to normalcy. And much of the loans, we have already started moving to MCLR in the corporate side. All loans which are getting repriced or refinanced, renewed today are predominantly moving to and reduce the floating T-bill rate linked loans. That gives us confidence. One is the repo rate being stable. There is no movement on the ABL side. And the corporate book, which moved significantly towards stabil probably will be brought back to MCLR. Even without considering them also, we are confident that we'll be achieving the 3% NIM, because of the stability of whatever currently achieved.

And MCLR will not reprice downward, right, because...

It will not be repriced because we are not adjusting the interest rates on the deposits. either repriced lower or repriced higher is unlikely.

So sir, assuming there is no change in the cost -- in the card rate of the deposits. the cost of deposits should still decline, right, in at least in the year...

So there are 2 reasons why they will decline. One is I think we are focusing more on the CASA. CASA component will contribute to the reduction. If you see, even in Q4 also, we have contained the cost of resources. And the other thing is that we would like to -- we have cut down significantly on our wholesale deposits, which are expensive. We will further be cutting down on the wholesale deposits. which gives us some relief on the cost of resources.

Right. And secondly, sir, on LCR, if you can highlight what was the LCR during the quarter, Q4. And after these guidelines which have come in from April 1, how does that change?

What is the LCR number you have?

For the quarter, it was in something 124 approximately.

That was average for the quarter.

That was the average for the quarter.

Because last quarter, it was, I think, 130.

The liquidity is being consumed, right? You are growing at 17%. But the current guidelines will give us around 3% to 4% improvement in the LCR.

And what would -- I mean, this, let's say, 125 becomes 127, 128 what would be your, let's say, floor and maybe the upper limit for LCR2 operating?

See, for a bank of our size, we would like to have at least 10% to 15% of the regulatory minimum, regulatory minimum 100%, so 115%, I think is a good ratio to have. Today, we have -- as we ended the year around 125%. And in this quarter, again, it will move up further. So -- but we would definitely need if the credit growth continues. Some moderation will happen in the LCR. We would be comfortable around 115% to 120%.

Sure. And lastly, sir, if you have the number for AFS reserves, I mean, what was the movement in this quarter? What was in Q3, December end? And what is it at the margin?

Do you have the number? We will give you that number separate.

Pritesh From DAM Capital. Just 2 questions. So 1 is on the loan processing fees, it has been quite strong this quarter. almost doubled, I think, what has been the reason for that because loan growth has been strong throughout the year, but certainly, this quarter, we saw that growth.

What's your name, you said?

Pritesh from DAM Capital.

Pritesh, thank you very much for asking this question. I was just waiting for someone to ask this. Everybody is worried about NII. See, I think -- I mean, rightfully, I'm not undermining that. The overall construct, which we mentioned right in the beginning, I don't know, it sounded more English to you, but we really mean every word what we mentioned there. We are focusing on the relationship value. For instance, this processing fee is not only coming from retail operations, retail operations, of course, have given a significant uptick in the processing fee. We have seen both in the large corporate, small corporate, MSMEs, everywhere we have readjusted our costing fee. It is not only readjusting the processing fee, not by way of increasing but reducing the concessions. We have promised them the good quality service, and we started charging for the product efficiency. And today, we have almost -- in the retail operations, we have had a growth of 50% in processing fee and the corporate book almost 30%, 35%. So I think we are increasing our field staff to be more proactive in terms of negotiating on that.

Sure, sir. Second question was on basically the G-sec yields have moved up, but our investment yields are slightly lower. One would have expected that the yields for us also will have tandemly moved up in the quarter. Is that we've moved some of the securities and booked some gains, and that's why the losses are slightly lower or any other...

Yes, some trading has been done. So if you see our trading profits have been good this quarter also. So that means that some of the switches we have participated in that, which also add portfolio yield moderation has happened there.

So basically, the profitable securities have sold in that...

I mean it depends on what securities are asked by the RBI, right? Anything you want to add?

[indiscernible] allowed. So if you want we can give the figures, we made in the entire year around INR 6,321 crore.

Sure. Sure. Sir, last question was on this -- basically, there were news articles that a lot of RBI has asked oil companies to move the dollar buying and selling through our bank and also related FX related transactions to our bank. What is -- how is that going to benefit us? Any outlook on that?

I'm not aware of this.

[indiscernible] excellent annual numbers and report numbers [indiscernible] very high payment of income tax for INR 25,000 crores, you are doing certainly...

Is that back-hand complement, is it?

[indiscernible] despite of that over INR 25,000 crores in this type of a environment is really wonderful. And a couple of important points. Now everybody is looking at value unlocking and we have over 10% in National Stock Exchange. SEBI Chairman has said it should get listed soon. So how -- what's our thought process on value unlocking? I see Page 55, which talks about total reserve and surplus some INR 5.95 lakh crores. Now we'll get valuation, fair market valuation on the balance sheet. Apparently, this number will also go up. But in terms of business generation IRR would like to know what is our thought process if we can use some of the capital or value generated in the core banking business and short term or long term, ideally? So that would be very nice if you can share in detail. Second point is on market share of SBI. Today, we are talking about 20%, 22.5%, there has been some thought process and talks going on if 1 can increase market share gradually. So what is the thought process of the bank's Board of increasing market share whether through rural banking or through district banking or branches and aligning with the government's objective? If -- in how many years we can come to 25% market share and what is our core strategy on that, also including globalization? I think it could be a great opportunity. That's it. I found the results better than expected because I've been present and looking at the transcript. So it was a knee-jerk reaction. But with your clarification and a lot of value unlocking, hopefully, your direction towards that should help in creating greater value year-to-year, all the best to the Board and team.

Thank you for the compliments. Yes, yes. Of course, I know you, but I wish I own 10% of NSE. Unfortunately, we don't. Within the group, we have around 7.3% holding. But bank itself would be keen on participating in the FS. We have given our in-principle consent to them. What kind of participation will happen, the Board will determine -- but as you mentioned, I think the moment tenancy gets listed, the whole shareholding by SBI will be available as a reserve to us to mark-to-market. Currently, it's not mark-to-market in our books. Yes, I think several times, US have mentioned the hidden reserves, what SBI has in terms of strategic investments. And this year, I think if NSE gets listed, that unlocking will happen. We are also seriously, as you are aware, we have embarked on listing SBI AMC. And hopefully, in this financial year, we'll be able to complete, which will result in capital augmentation, CET1. And this capital, we would like -- that's what I think gives us confidence that going forward, two things which are required for supporting the credit growth in terms of capital is fully -- we are convinced that we have the capability, even with the current position we can fund almost INR 12 trillion credit growth. And the further augmentation will help us going forward. And enough liquidity in the system and a large bank, which has got INR 59 lakh crores, which will be probably in this month, we'll be crossing INR 60 lakh crore deposits growing at 11% to 12%. As I mentioned in my inaugural speech, it is a bank which is adding INR 11 lakh crore business every year, which is equivalent to several other banks. But we want to do it efficiently. The scale is kind of given, right? When you have INR 109 lakh crore business, the normal growth rate itself will add to your scale. So we want to use this capital efficiently, efficiently where it is required. And efficiently in terms of giving the return to the investors, shareholders to the -- so we are sticking to our guidance through the cycles, we would like to ensure 15% return on equity to our investors, minimum. So your second question, I think, is a very, very important question that when you have such scale and such dominant market share, how do you grow further? And this is something what we deliberate very seriously in the Board. And we have now embarked, I think I must have mentioned last quarter also that we want to increase the market share in every district. Today, fortunately, the data is available, market share data is available at the district level. So it is -- our strategy is that -- even if in a district, you have a dominant market share of 60%. There are districts where SBI has a market share of 60%. But our guidance is that 1% increase in market share. whichever is that. If the you have 10% market share, or 60% market share. Every district we would like to grow 1%. I'm very glad. Whenever I travel in the field, the lowest officer in the bank also is aware of market share. sir, we are trying to improve the market share in our district. I think this is a great strategic shift which is happening. And 25% is a little further but we would like to move 1% every year. That means 4 to 5 years, as I mentioned several times, we would like to be 25% in terms of the GDP of the country.

If you can permit me, particularly on segments, I found gold loans, it was a focus area. Now we have precise 100% growth. We have a good critical mass of over INR 1 lakh crores as a thing. Express credit also now initiative since a few years we have a good base now. Auto sector, we found a little growth a little muted at 8.5%. But hopefully, with the pace making efforts, mediation prices coming down, oil prices. Hopefully, you can tell us the growth can improve. So can we look at also gold loans, whether we can -- why don't we use opportunity to increase our NIM to that because other gold loan players, NBFCs are really having usurious rates, and we seem to be doing a service. But with the entry made, if we can increase market share and increase NIMs and also your thoughts on this increasing the rate -- growth rate growth in advances further through these verticals, which we mentioned in your priority areas? That would be nice.

You want to respond before I discuss.

So AFS, somebody has asked. So this 31st March number is INR 5,136 crores, AFS reserves.

They want to see the movement.

Movement in December quarter, INR 8,151 crore, so roughly INR 3,000 crores decline.

Yes. But it did not have much impact on the CET1 ratio. Your question in terms of the gold loans, so the gold loan market is highly diversified. The ticket size what we look, for example, average ticket size of gold loan in our books is about INR 2.5 lakhs. These are price-sensitive segment. They are not INR 20,000, INR 30,000 loan amount of people who are willing to pay anything, any rate of interest. These are price sensitive. And gold loan also, you must realize there is a very efficient equity product -- return on equity product, ROE product because there's 0 risk weight on that. So we would like to have a very strong growth but with very qualitative growth. For instance, our overall LTV is 52%. That means you have very safe lending there. And yield is also not bad. I think 8.5% to 8.75% is something what we get on this 9%. 9% is a good yield for a product which doesn't require any capital allocation at all. And with almost 0 NPA.

This is Piran Engineer from CLSA. Just firstly, sorry to harp on the NIM question again, but we exited with NIM of 2.9%. Our road map to 3% NIM would be driven by deposits...

No, we exited 3% domestic NIM. And our guidance always has been on the domestic NIM.

But -- so okay, 3% was the full year NIM, right? Yes, fully -- the last quarter's NIM was 2.93% is low. It's in your PPT 2.9%. Yes. So for that to improve, is it going to be a yield-driven thing or a cost of deposits driven thing?

So as I mentioned, you have 60% of fixed deposits. And fixed deposit growth is significant for us, 14%, 15% on the retail term deposit. We would like to have both levers used. One is reduce further cost of resources. It may not be very significant, but reduction of cost of resources will happen in 2 ways. One is whether we can further augment our CASA in terms of absolute amount. And then number two, reduce the wholesale deposits, which are expensive. But that moment will be very limited. I don't think there will be any significant pickup on that. You're right, I think it will be more in terms of the yield on advances management. We would be looking at asset mix and also increasing spreads, wherever it is feasible both on the corporate side as well as retail sides.

Okay. And just secondly, what percentage of our MCLR book is yet to reprice?

MCLR book, I think the 5 basis point which is done in December is reduced, right? That will take about 3 to 4 months, but there's not much great impact.

But the ones done in October, a lot of them would still be left, right, because...

6 months MCLR is predominant. So we have about 40%, which is 1 year, some part of that probably is left out, otherwise, mostly it's priced.

Understood. And sir, lastly, just on current account deposit growth. We were doing pretty well growing 20%, 25% until 2, 3 quarters back. Now it's come down to single digits. Anything to read into it? Or is it just a period end number?

Period number of the previous year, which has impacted. See, we had a period in movement in FY '25, March '25. We had a significant current account movement because of the government funds release. Those things were not there. And this was a very large amount, almost INR 50,000 crores, which has come in the last few days of March '25. Despite that funds not being available, I think we have done phenomenally well in the current account. And as I mentioned somewhere earlier, we have had a 21% decline in the government current account deposits in the last year, whereas we completely pivoted towards nongovernmental current account, where we had 23% growth rate in the current account. That is the number which you see, the year-end number for March '26, in my view, is the best number ever we could achieve by SBI because we had a double impact of the last minute flows, which were not available this year. And the overall current account deposits from the government has fallen about 21%. Despite that, because of our strategies and current account business account being open, 23% growth rate was there in the non-governmental account. I think this is a very good current account story for us.

Just to add. So 1 is the current new customer acquisition and more balances in current account. Apart from this, retail current account customer, our business current account customer. They are also giving us opportunity to cross -- sell other products to them. They are maybe our prospective SME borrower also. So this is the the value, which is essentially hidden, you can say we have to unlock or the process of unlocking. So this is giving us deployed on the 1 side, focusing on retailer business customer for current account and also creating opportunity for other fee income plus maybe lending also in the future.

Understood. And sir, just lastly, 1 suggestion. Slide 15 is pretty useful. Can you also include quarterly data points, maybe put a Slide 16 with the same information but quarterly. It will be really useful for all analysts.

We will see. See, we didn't want to change the slides midyear.

Yes. So now that you will enter, onwards, you will try to improve very useful.

Q1 onwards we will try to improve on.

Anand from Emkay. Sir, other OpEx seems to be on a higher side on a quarter-on-quarter basis. There's a lot of bunching of other OpEx, which happens in the fourth quarter. which happened last year as well. Is there a way apart from any business acquisition cost to spread out the OpEx one? And how do you see the cost income ratio shaping up in FY '27? Any efforts that you're taking to improve that because that's certainly on a higher side, given that we have a sizable corporate book, but still a cost to income ratio at about more than 50% is slightly on a higher side. What are the efforts that we want to take on that front?

See, our effort is to keep a cost-to-income ratio contained below 50%. I think this is a guidance which we have given. And we would have had probably ended the year with 48%, 4,7%. But for the treasury income not supportive. Otherwise, the costs have been contained both in terms of bunching happens because of the payment cycle, which comes through. It is not intentional, but I think by design, much of the overheads are booked during the last quarter. So most of the expenses and income for Q4 has to be compared with Q4 only. Any other comparison will not work. So I don't think -- at this moment, we are not thinking about, but we will definitely have a look whether any of the expenses can be spread over the 4 quarters, so that will not have the bunching issue.

Sure. On the ForEx open positions, which were basically asked to unwind. So that impact we have largely taken in the fourth quarter, sebuthat will happen in first quarter?

I did mention, I think we said that -- the Q4 MTM impact, what you see is about INR 100 crores. And complete unwinding had happened on the tenth April, which resulted in a net loss of INR 57 crores.

Okay. That's very small. And you've guided for a credit growth of about 13% to 15% for FY '27, right? That's on a lower side versus what we had in this year. So 13% to 15% chances, probability of that hitting the higher end of the guidance still is higher -- going to be strong.

I think as it stands, it looks good, except that how this West Asia conflict, how much it lingers, and apart if we -- if we do not factor in that at this moment, I think that 13%, 15% seems to be a feasible option. See, at the same time, as I keep mentioning, the credit growth is a function of macros. We don't want to grow significantly higher than what macros can support. So if we have 6.5% 6.9% GDP growth with 4% inflation and nominal GDP of around 10% to 11%. We built around 3% over that 3% to 4% max. If any of these numbers don't realize, then we don't want to grow as much.

And sir, what's your broader outlook on the MSME space because that's the one which has been impacted the most because of the West Asia conflict? Any stress pool that we have identified? Do I know that basically, we're going to do a lot of ECLGS, but that again will be construed as that we are supporting that customer. So any stress pool that we have identified, any incremental provisions they're going to make and that's why you're guiding for a 50 basis point credit cost in FY '27?

No, 50 basis point credit card is something what we've been guiding for the last 3 years. We considered to do that. It's nothing to do with the West Asian conflict. But even if any some movement is there, we still are sticking to that guidance. broad-based stress is not visible yet. There are clusters which are impacted definitely. For example, Morbi cluster, which is being talked about because gas is not being affordable by them, so they are not producing. Small and medium enterprises, they are affected. We are working with them, what kind of support they need. In fact, last month, we have asked them to take annual maintenance. That period is also over now. They have to come back to production, but they have not come yet. But that is overall credit exposure to the whole cluster is very minimal, but they definitely need some support going forward. We'll have to see what support we can give. Other than that hydrocarbons, obviously, the oil companies are impacted, but there are very strong balance sheets. I think there are no credit-related issues with them. They may have their own P&L issues, but it will not translate to a credit issue.

I'd like to just add a couple of points just around the way we have been mitigating the risk in the MSME portfolio, we have launched BRE, I think we announced in several quarters back as well. This is giving good results. In fact, when we look at the delinquencies in BRE versus non-RE portfolio, BRE portfolio, the delinquencies are lower. That means underwriting models are much more robust. Second data point is like in terms of CGTMSE eligible loans, like which can be covered under CGTMSE, in the absence of that, we used to take -- partly, it used to be collateralized. We have shifted from predominantly CGTMSE, so coverage is almost of the universe, which is eligible for CGTMSE. So the -- obviously, our mitigation is much higher and records to the CGT MSE is much higher. I think these are helping us to get a better handle on the quality of the portfolio.

Param here from Investec. So a question on your term deposit repricing, term deposit repricing lower. Is it largely done? Or is there any...

Some residual tail end that's all, but mostly done.

Okay. Sir, secondly, on your salary costs in this quarter. It is -- generally, Q3 to Q4, we see an uptick. There is a PLI-related payout. But this time, it's not there. Is there some...

Yes, there is, I think, a classification change because the PLI, which is to be given on the base of the government PLI, it is still being debated. So we have not booked in the staff expenses. What you see in our presentation. It is in other provisions. So if you add, I think it's broadly in a similar way.

So it's accounted for.

Accounted for.

And sir, lastly, your -- you will be saving on DICGC premium next year, right? So...

Don't ask me the number. I will lose my job.

What you paid this year that we can calculate the rest..

Sorry, no, we -- as per the regulation, we are not able to -- we are not supposed to disclose that. We will get benefited definitely but this is not a disclosable item.

Congratulations to team SBI for multiple milestones. Global transformation is a necessity for India led by war, maybe business mixes are changing. I personally says there's going to be a big CapEx boom in India led by energy. So we need renewable. We need data center is a lot of energy. The Middle East attacks on Amazon, may diverted a lot of data centers to India. The transmission line expansion needs big growth. Any kind of indication or lead time which you're already sensing because these ticket sizes will not touch base with a bank, which is not of a size. And they will have to participate along with SBI to disburse the money. And SBI Caps have a big role because I see a lot of reports generated by them to be it hydrogen renewable and multiple sectors.

So I'll answer that, and I'll also ask Ashwini to respond on that. Transmission, yes, I think, is going to be 1 of the most important infrastructure which is going to be developed. Some of the projects are fairly large, as you mentioned. We have been having discussion with them. What kind of structure they will come out is not very clear yet, the there will be an SPV or it will be done by their own companies. But there is a good opportunity coming up there. Apart from transmission, we also see a lot of emerging sector. I think last time also I mentioned we have started an initiative called Chakra. This is to support all Sunrise sectors, whether it is green hydrogen or whether it is data centers, whether it is new renewable energy models which are emerging. So the -- or even small modular reactors, which government has been talking about semiconductors. These are all the activities and sectors probably which have greater potential for investment. But they need a separate kind of structure. It is not a pure vanilla loan, which they require. They may require a mezzanine funding, they may require equity funding. So we want to handle that kind of composite structures through our Chakra. As far as transmission, Ashwini Ashan, you want to add something?

Sir, 2, 3 things. Transmission, of course, what serves the transmission, a lot of potential. But I would also point out to battery energy storage systems, you've got a large number of proposals, which we are processing. We also have the data center is another activity where we have got a large number of cases we are looking at, some we have already done. And then there are others like pump storage hydro, which is something which is starting to come to us. These are only 1 or 2 are live currently, but now a large number of people are coming because the rates tenders are all for round-the-clock power. It's not plain vanilla, solar or hydro, et cetera. So with that combination, either BESS or pump storage hydro combination along with solar wind is the new flavor. So we are seeing a lot of activity and transmission clearly is 1 thing which is the need of the R because without adequate transmission, the curtailment in solar is quite high. So I think we are supporting all of that as it goes forward. And lastly, smart metering. We've done quite a bit already, but still, there are a lot of enough opportunities there.

Sir, when you highlighted a data center, are we funding GPUs or we'll only do infrastructure?

Both, yes, both. So we look at the -- Comes as a package. Package. We look at the clients which are there, because the way it is being presented here is more like a developer story because the developer creates a shell and ultimately, the fit-out is done by the ultimate user. And we are focusing largely on the hyperscaler model because that's where the demand is as showed, and there is no -- the client, the quality is assured. So we've got quite a few of them and Mumbai especially has a lot of data centers coming up. We see a lot of potential in the sea.

This means that hyperscale means your LRD business, ticket size, maybe 15, 20 years kind of tickets and competitive. How is that visibility, sir?

So as far as infra the greenfield project is concerned, our ability to price is better.

Sir, my last question, SBI Yono 2, multiple retail salary accounts with touch points to customer concern on wallet share, how many products are we currently doing and what will be target?

You have an PPC number? But the last number I know is about 4.5 -- 2.5 to 3, around 3, financial products. So I think 3 is okay, but our idea is to take it to 5. And there are customers who tell me that they take about 8 to 10 products, different products from SBI. So that means that there's a potential to go to 8 or 10. But we would be okay if we reach a PPC of 5. And auto loans, what you have asked essentially is a hook product. You can't make money on the auto loan itself with the dealer commissions and other things. But it brings many other product engagements.

But to reach 5, I suppose we need a lot of a transformation where human resources concerned specifically on retail. So branches are concerned, connectivity. So everything can be digital , so how are we building up that capability?

So this is something what we mentioned that how do we use our manpower at the branches when a large number of transactions have moved to alternate channels, we are redeploying some of the workforce into sales and train our workforce in the branches for upselling. So this is something what is happening overall. And that is how you see that for a large bank, the diversified customer base, we have an average of 3 is a good number.

Sir, the mutual fund and insurance business -- are we tracking at the district level?

At branch levels. YONO also has a deep integration with subsidiary production. Recall, we always face this charge of misselling and although we are the lowest. So I think all of that is being attempted in the right suitable team.

Sir, this is Mahesh from Kotak. So 1 question around the margins again. What is so different about this quarter in terms of the margins changing direction so sharply, whereas if you look at the last 2 rate cuts, which happened in March and June, the impact on the P&L was not that high. Whereas this time around, you seem to be attributing the entire decline to that 1 particular variable?

No, I'm not attributing only for that. I said that the way the composition moved...

It is not high, right?

The overall EBLR and T billing pricing as we looked at is what I said, the corporate book has moved to a floating rate whatever growth has happened in the last quarter is also predominantly came from the T-Bill, which gives us confidence that we can do the asset mix change going forward, and we're trying to move every table linked loan to an MCLR-based loan.

Just to clarify that 1 point. The bill increase last quarter, right, in terms of the price at which it was versus where it is today, that would have had a positive impact?

No, no, no. T-Bill portfolio has increased.

But that portfolio would have had a natural upward repricing rate during the quarter or in the last...

You have to compare with MCLR versus still, not the T-bill versus stable. So the 1 which is MCLR linked earlier has moved to T bill and bring down. T bill is an uptick. There's an -- overall T bill portfolio has had a good yield pickup. But if something is moving from MCLR to T-bill, then there's a dip in the needs.

But this was a choice you took in advance...

It is not only choice. I think the choice -- See, it is also the composition of the users of the facilities. See if you have seen -- since you have asked that question a little deep drive probably is required. A lot of large well rated corporates were accessing the market has moved to banks. And most of their facilities were linked to T bill. They were not utilizing at all. They were not using all they were using access the market CP and all. That has more to the bank, and this is the relationship value we have. While you all are looking at the NII part, we are looking at the overall value of the relationship with the corporate, which is not evident in the NIM. It is evident in our -- where do I get the ROE, where do I get the fee-based income what are you seeing on the other income. It is because of the relationship with the corporate when they come back to us, I can't say that I'll not give a committed T-bill rate. Even if it means that there will be some softening of deals on that. This is what I was trying to explain. It's not purely on the 25 basis EBLR, which anyway, we have announced. What we have not factored in for a significant movement from the market to a bank.

So if I were to just simply draw the difference in the corporate sector, and assume a large part of it was stable. I should be able to understand which portfolio took the T-bill portfolio.

Meaning?

If I were to just kind of -- I was just trying to understand as to how long this impact will be in the...

No, no, these are all short-term impacts only. predominant book has been in the short term. There could be some medium-term loans also, which are T-bill price. But in the current financial year itself, we would be able to move a large chunk into MCLR based. There are 2 ways of handling this on the corporate side, particularly where we have very strong relationship. It's not only purely small working capital being drawn by them. Either you increase the spread over T bill and say that this is what the spread I'm looking for. If they are getting a better price, they move on or move them to MCLR. So these are the 2 strategies which we are be following this year.

Perfect. And 1 last question. When we do the calculated yield on advances, the decline has been fairly sharp. Now 1 of the reasons could be that the book has grown towards the end of the quarter...

Yes.

If I were to just move into 1Q and 2Q, I know that you don't want to give a quarterly guidance. I'm just trying to understand, does it dip first and then starts moving higher? Or do you have visibility of how this track...

I don't want to I'm still sticking to my 3% annual NIM. But if you really ask me, I don't think there will be any further dip if it satisfies you.

We wanted that answer, sir.

I think we have to go on.

This is Nitin Aggarwal from Motilal. Sir, 1 question again around the corporate loan growth. If I look like last 2 quarters, we have reported almost 15% growth in the corporate loan book. while you talked about that you're looking at things in totality in respect to ROA and ROE, but does this growth momentum -- well, do you think this will continue in the next coming quarters because it will continue to have a bearing on the margins also? Where we are expecting things to move up from here.

So the part movement also, as I mentioned, from market to bank, if the market improves, probably the reversal will happen. So that's the reason our corporate guidance is what we are looking at. And our 13% to 15% will be primarily driven by the RAM growth.

Yes, due to pausity of time, we'll now take up a few...

You want to ask something?

Just 1 clarification on the ROA, where we talked about 1% plus ROE that you look to maintain. As we now start providing for ECL, you talked about a 3-, 4-year transition journey, will that guidance stay unchanged over those 3, 4 years? Or you see some...

We are still saying that 1% through the cycles.

Sir, we have a few questions coming in through the online webcast now. These will be addressed by the Chairman now.

I think there's 1 question why Q3 profit is more than Q4. I think it is the other way around why the Q4 is having less profit than Q3, mainly because of the MTM loss of INR 4,523 crores in Q4 as against loss of INR 143 crores only in Q3. This is a question from Venkateshwara Rao. And question Tambrish Sinha from of business. What is the guidance on net interest margin and for FY '27. NII guidance, we don't give, but NIM as I said, our guidance for domestic is to remain above 3%. And Vikas Bardia, why was Q4 NIM so much lower? I think we have had enough discussion on this. If any further clarifications are required, we can have separately. Sunil, Melwani, what are the bank is planning to take increased market share in CASA? This is what I mentioned in terms of focusing on the district level improvement on the market share as well as a very strong campaign which we launched. I've seen good impact of that campaign is ABCD, all branches to contribute to deposits. I think this is also helping us in terms of mobilizing. And as I mentioned, Savings Bank, we have witnessed good growth of almost double-digit 10% growth and a very large base of Savings Bank. Mridul from Senora Asset Management, what was MTM loss provided for treasury losses for the same past by NII. There's an MTM loss of INR 4,542 crores in Q4 as against INR 143 crores in Q3. The MTM is rooted through other income, noninterest income. Rohan Mandora from Equirus. You are cumulative domestic yelling advances for 12 months is down 11 basis points. So what is the domestic yield for Q4? And what explains the sharp decline? I think, again, this also we have explained at length what led to this field and decline in yield. But essentially, as I mentioned, reported cut of 25 basis points and also a shift in corporate credit composition. Sidarto EBLR is only 35%, so they should have been only some 7 basis points. I think we need to add both the EBLR book as well as the T-billing advances. So that is about currently, we have e-bill and T bill of 49%. Whether the bank has made an amount of provision based on ECL? No, not yet. So that's, again, share of AAA and in corporate mix has risen by 40 basis points. Does it have an impact on yield guidance on the share of AAA going forward? As I mentioned, some of the best well rated companies have moved from the market to bank, while it had dramatically altered the composition of AA and AAA. It had impact on the yields, as I mentioned earlier. Jeet from Ambit. Please clarify off-balance sheet exposure like financial guarantee not required provisioning. Can we now assume that nonfunded credit export disclosed in Basel III will require provincial norms provisioning a non-fund credit experts shall be completed as per RBI guidelines, effective from 1/4/27. I think they also attract provision. So I think broadly, we have answered the questions. You can go ahead.

I trust all the questions have been addressed. We will be happy to respond to other questions in offline mood. Let me end the evening with thanking Chairman, sir, MD sir. the MD, sir, top management team, senior officials of the circuit and various offices connected through webcast analysts, investors, ladies and gentlemen. We thank you all for taking time out of your schedule and joining us for this event. To round out this evening, we request you all present here to join us for high tea which is arranged just outside this hall. Thank you. Thank you so much.