The South Indian Bank Limited (SOUTHBANK) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q2 FY '22 Earnings Conference Call of South Indian hosted by DAM Capital Advisors Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Pritesh Bumb from DAM Capital Advisors Limited. Thank you, and over to you, sir.

Thank you, Rituja. Hi, good morning to all. On behalf of DAM Capital, I would like to welcome the management of South Indian Bank, represented by Mr. Murali Ramakrishnan, MD and CEO; and other senior management team of the bank. We will quickly have opening remarks from the management followed by Q&A. I will now hand over the call to Mr. Ramakrishnan. Thank you, and over to you, sir.

Thank you. A very good morning to all of you, and thank you for joining us for the South Indian Q2 FY '22 Earnings Conference Call. We are joined by my colleagues, Mr. Thomas Joseph, Executive Vice President and Group Business Head, Sales; Mr. Anto George T, Head, HR and Admin; Mr. Sanchay Sinha, Head, Retail Liabilities; Mr. Leelanand, Head, Treasury; Ms. Chithra, CFO; and Ms. Minu Moonjely, GM, Credit. We hope that you and your family are safe and healthy. We continue to appreciate the efforts of our employees who have been -- who have shown strong resilience and ability to adapt to changing circumstances. With the help of vaccination camps organized in our offices across the country, about 96% of the staff are vaccinated for COVID. Coming to the macroeconomic factors, the Indian economy started gradually picking up alongside gradual easing of second wave of COVID restrictions since second half of June. The economic indicators like GST collections, IIP, et cetera, have gradually improved for the last few months. Further, the inflation has remained within policy range, and the RBI continue to hold accommodative view. However, given our big presence in South India, and there was a prolonged lockdown in some states, the bank saw improvement in business activity from September 2021 onwards. We are hopeful that a decline in new coronavirus, accelerated vaccination drive, improved customer and business confidence, anticipated higher demand in the upcoming festive season, among others, will further enhance the pace of economic recovery in the coming months. The bank has undertaken multiple transformation projects starting October 2020, and we are seeing traction in each one of them. Let me give a brief of the major shifts which had happened over the last 1 year. We have brought in the concept of vertical asset structures with dedicated product expert heading the vertical. The full structure with dedicated team has been put in place by end of July 2021, and we have started seeing business gradually improving from September onwards. The bank had launched a few retail asset products in line with our stated retail products roadmap for the medium term. Our strategy to improve profitability through quality credit by introducing unsecured retail business is showing a traction. The bank entered into a partnership with FPL Technologies to launch co-branded OneCard metal credit card. The SIB OneCard comes with features such lifetime validity with 0 joining and annual fee, 100% digital customer onboarding process, instant virtual card issuance, instant issuance of reward points and easy redemption within the app, et cetera. Given digital banking being one of the focus areas for us, this next-generation credit card is the best product offer to Indian's young population. The credit card were initially launched for employees, which has now been extended to our customer base of 65 lakhs. We had issued over 4,000 cards as we speak. The bank has also launched another high-yielding preapproved personal loan. The personal loan is offered based on the imputed income and various times tested algorithms in tie up with credit bureau. The bank has seen initial success and disbursed over INR 100 crores in a month of personal loans for the month of September. We are launching other preapproved asset products to augment growth and profitability in the coming quarters. Coming to branch banking, we have revamped the branch banking structure by bringing in a layer of cluster heads to improve span of control and bring focus on strengthening liability franchise. Further, we have identified dedicated vertical heads for branch banking and NR business, which has been instrumented in building strong growth in CASA ratio from 25% to 30.8%. The bank has also been empanelled as an agency bank by Reserve Bank of India to undertake general banking business of central and state governments on behalf of RBI. This will further augment our robust deposit base by tapping government business. As far as sales mix is concerned, the bank was predominantly sourcing its business through branches. Recently, we have started adding multiple sourcing channels, including network of direct selling agents, DSAs and collaboration with fintechs to generate business. We also launched our new CRM Next which a capability to track potentially the end to end. This has helped us to track customers on all our digital assets, including SIB Mirror+ mobile app and SIBerNet Internet banking for better and customized product offering. The bank has also incorporated subsidiary after required regulatory approvals, which is being used to create a pool of direct sales team. Towards building strong infrastructure for a digital bank, the bank has set up strong data science team with domain expertise to do analytics in the area of assets, liability and collection. A comprehensive framework to monitor the quality of asset portfolio is being implemented with specific focus for -- on early delinquencies, collection efficiency, et cetera. Preapproved offers identified with lower risk are also generated through use of analytics and in collaboration with credit bureaus. One of the key strengths of the bank is young and professional workers. We have recruited over 1,500 employees across various verticals and roles. The bank has also implemented online LMS, that is learning management system for competency building of the employees. In order to motivate senior leadership, the bank has revamped its employee stock option plan and brought in the concept of talent pool to create bench for leadership roles. In order to improve credit monitoring, we have set up robust credit recoveries group which tracks the early signals through rigorous credit monitoring exercise. The team also takes care of pre and post disbursement activities, gaining better control over the entire loan cycle. Recovery has been a key focus area of the bank. We have a decentralized collection structure with dedicated regional collection managers for each region. [ SARFAESI hub ] has been set up where preparation of approval notices are centralized for all regions, resulting in reduction in tax from 60 to 90 days to around 30 days. The bank has achieved significant strides in digital banking backed by robust technology infrastructure and innovation. The share of digital transaction has been consistently growing quarter-on-quarter and stands at 92.1%. The mobile banking transactions volume has increased by 118% year-on-year to 46 million transactions and contributes over 96% of the total digital transaction volumes. We have been continuously ranked among top 10 digital banks by MeitY Index. The bank has been in forefront for its digital -- strong digital capabilities. This has been further strengthened by launching critical IT system, including loan origination system in collaboration with Nucleus, Experian retail credit models, integrated treasury system with a host of ForEx products, robust collection system with capability to assess collection efficiencies of agents, CRM Next platform with 360-degree view of the customer and new SIB Mirror+ mobile app for ease and convenience of the customers. We are seeing good progress in the transformation journey and are hopeful that with the conducive economic environment, we'll be able to grow in the coming quarters if the headwinds of economy subside. Let me take you through key highlights of the operation and financial performance for this quarter. The total business of the bank stands at INR 1,45,149 crores as at September 30, 2021. Advances were stable at INR 58,309 crores. We have continued to grow our gold loan portfolio registering growth of 11% year-on-year to INR 9,470 crores as of September 30, 2021. The bank continues to calibrate and churn corporate portfolio with better rated corporates. The share of A and above rated corporates in large corporate book, that is INR 100 crores and above, improved from 56% at June 2021 to 75% at September 2021. During the quarter, we also launched pre-approved personal loans and achieved disbursement of INR 100 crores of personal loans in the month of September. And SME has also registered disbursement of over INR 300 crores in September 2021. Retail deposits rose by 10% year-on-year to INR 82,402 crores. CASA deposits increased by 17% year-on-year to INR 26,773 crores, predominantly due to continued improvement in our savings account business, which grew by 18% year-on-year to INR 22,403 crores. CASA ratio continued to improve and reached 30.8% of the total deposits. Bulk deposits, in tune with our strategy, declined by 41% year-on-year to INR 4,437 crores, which is in tune with our strategy. NRI deposits, which has been growing steadily, rose by 6% year-on-year to INR 26,823 crores and contributes about 31% of the total deposits. Low-cost NRI deposits grew by 6% year-on-year to INR 8,187 crores. The bank saw a robust growth of 29% year-on-year in our NRI remittance business during the quarter. Our investment book was at INR 23,056 crores, of which HTM category contributed INR 17,302 crores, while AFS contributed about INR 5,681 crores. The bank witnessed slippages of INR 531 crores during Q2 2022, which were in line with the guidance given for FY 2022. Personal and business segments continue to see the impact of the COVID. The bank had restructured INR 579 crores worth of loans under OTR 2 framework, of which business segment is about INR 348 crores, personal segment is INR 176 crores and corporate is INR 55 crores. Following the unlocking and lifting of the second wave COVID restriction, the bank saw improvement in the collection efficiency. The overall collection efficiency for the month of July, August and September 2021 was 88.3%, 108% and 91.4% respectively. Gross NPA ratio improved by 137 bps from 8.02% as at June 30, 2021 to 6.55% (sic) [ 6.65% ] as at September 30, 2021. During the quarter, the bank sold INR 1,049 crores worth of loans to ARCs and was able to recover or upgrade INR 277 crores worth of NPAs. The net NPA ratio improved by 120 bps from 5.05% as at June 30, 2021 to 3.85% as at September 30, 2021. Net interest income for the quarter was INR 527 crores. Net interest margin was 2.52% for Q2 2022 compared to 2.55% for Q1 2022. The decline in the margin was predominantly due to a reversal of interest on account of NPA slippages of INR 46 crores. Noninterest income decreased to INR 99 crores. As per RBI directions, provisions for depreciation on investments amounting to INR 176 crores for Q2 FY '22 has been shown under other income in the profit and loss account, which was originally classified under provisions and contingencies. Further, amount recovered from return of accounts of INR 58 crores was reclassified under provisions and contingencies against previous year classification under other income. However, our core fee income increased by 27% year-on-year to INR 117 crores and other income increased by 7% year-on-year to INR 98 crores. The said revised accounting norm has impacted our PPOP which stands at INR 112 crores for Q2 FY '22. Excluding the said amendment, operating profit would have be INR 346 crores. Overall, provisions increased by 19% year-on-year to INR 362 crores in Q2 FY '22. These provisions include INR 269 crores towards NPA and NPI and standard asset provisions of INR 55 crores. As a prudent measure, the bank has made an additional provision of INR 160 crores, which resulted in improved PCR from 60.11% as of June 2021 to 65.02% as of September 30, 2021. Had this additional provision of INR 160 crores not been provided, the net loss of the bank would be only INR 27 crores. PCR, excluding write-off, improved to 43.9% as at September 30, 2021, compared to 39% as at June 30, 2021. Our overall capital adequacy ratio improved to 15.74% as at September 30, 2021, compared to 15.47% as at June 30, 2021 while the Tier 1 ratio stands at 12.77% as at September 30, 2021. We believe that our strong and diversified franchise, large distribution network, structural changes to bring about growth, infusion of talent and technology capabilities with improved tools will provide us ability to leverage opportunities for profitable growth in the coming quarters with the headwinds in the economy tapering. With this, I open the floor for questions.

[Operator Instructions] The first question is from the line of Bajrang Bafna from Sunidhi Securities.

Sir, just if you could help us to understand, we have not seen any increase in number of branches. But during this quarter, the number of employees has been increased, and we are in the hiring mode. So you could help us to understand what is the rationale behind this new hiring? And what sort of business activities this segment is going to pick up?

Right. Good question. See, if you understand the strategy, we have actually moved away from the branch-based sourcing to the vertical-based sourcing for assets, right, that is one. And second, in the branch -- in the distribution side, we have brought in a layer of cluster heads above branches and -- where regional heads are above cluster heads. The way we have organized now is sort of 8 to 9 branches will be reporting to cluster head and 5 to 6 cluster heads will be reporting to regional heads. This is a structure of -- on the liability and distribution side. And the retail asset vertical side -- asset side, we have a business head under who there will be zonal heads, there will be regional heads and then there will be SMs and RMs which is, of course, different for each of these business lines. So the number of people who we have added need not necessarily be for opening up new branches. These are basically to fill in the slots which are required for beefing up the business structure in the asset side and to fill in the vacancies which arise out of the relocation of people from branches into verticals as well as people who retire, people who resign, so we need to fill in those slots because of which the overall hiring has happened. So -- and also as I read in my opening remarks, we've created a lot of support divisions. For example, CMOG has been brought in. We have brought in data analytics team, we have brought in marketing team, we have brought in -- operations has been separately moved as a control group. We have beefed up credit structure. So all these teams have been beefed up with manpower, so that these control groups and the support functions are in tune with whatever business strategy which we are articulating. So these extra resources who we have hired are not necessarily for any new branches. Of course, we keep -- we reoriented our branches, we do some consolidation of branches and any license which gets released out of that, we go and open branches in a location where we are not represented. That way, we have been opening some 5 to 10 branches every quarter. But the overall strategy of the bank is not to really go fill up on brick-and-mortar [Audio Gap] into digital way because the banking is going to move from brick-and-mortar into digital. That's going to be the future of banking. In tune with that, we have opened a full digital branch also. And also, these asset products, we are actually moving towards digitizing the entire loan process. That's the reason why we are buying in Nucleus platform. We are also looking at evaluating an SME platform. We have also brought in complete fulfilling happening through digital for personal loan, credit card. So all these are with an aim to ready the bank for the future of banking, which is going to be completely digital. So the conventional theory of recruiting people to go and fill up branches, that's not going to be seen at least for some time.

Okay. Got it. And my second question is that if we see the consolidation that was happening post you came in and in this COVID period, we have seen sizable consolidation of balance sheet that has happened where we have not grown our loan book and lot of calibration has happened, and we have moved to a lot of AAA or maybe A-rated plus corporates in this time frame. So the risk profile has been reduced to a great extent for the bank. But moving into now, we are seeing there is some amount of pickup which is visible, and we are not visualizing any sort of third wave, which is in our way. And a lot of other smaller banks or the NBFCs are also talking about the growth to pick up in these segments. So how we are going to place ourselves maybe in next 6 months or the next year where we are seeing the loan book to grow? Because unless and otherwise that happens, the operating metrics will be pretty difficult for the bank to improve. And since now we have increased the cost by hiring new people, so we need some sort of business to justify these cost increases.

Very good question. I'll answer it in 2, 3 parts. First of all, I want to tell you that we have -- as you said rightly, we have done a lot of consolidation basically correcting the balance sheet quality. I mean, in terms of portfolio quality by bringing in good quality cases across the business lines, not necessarily in corporate alone, but across the business lines. And just to give you a data, from April till 2 days back of this month, actually, we have disbursed more than INR 10,000 crores, which is actually in tune with the target which I had set for myself. So while you might be seeing the degrowth in the book happening primarily due to 3 reasons. One is the book which is turning out to the NPA due to slippages obviously move out of that. The book which is getting written-off where we have taken full provisions, that goes out. There are then bank-induced exits which happen, and there are some customer-induced exits due to low rates prevailing in the market. So all these have been leading to something like INR 2,000 crores to INR 3,000 crores of dip happening every quarter due to the combination of this, but if you look at book as of -- if you compare that with the book as of June end, we are down only by INR 10 crores. What does that mean? That INR 2,000 crores, which we are regularly seeing quarter-on-quarter dip due to repayment, due to movements happening, bank-induced movements as well as customer induced-movement as well as slippages, et cetera, we have compensated with the good quality book, which is coming in. So if I have to say this INR 10,000 crores of new disbursement, which has happened, if they are of high quality, you can imagine that in a INR 58,000 crore book, if you are adding almost 1/5 of that of high quality, you can expect in terms of quality of the book, which is going to get built, as we ramp up, our business is going to be far better. Why are am I saying that it will be -- quality-wise, it will be far better? For the various reasons I talked about, how we are strengthening the entire credit collection, data analytics and all those support functions we talked about. So to your question, whether we are seeing growth happening, that is exactly why I read out some of the data with respect to personal loan, with respect to SME, with respect to corporate, how we have seen traction happening even as and when this thing set up by July, we have started seeing traction happening from August -- mid-August onwards. So -- and as I'm talking to you, we are already seeing some traction happening in this quarter. So I am very hopeful that with the way we are now organized -- we have organized ourselves, we are going to definitely see good growth happening across all credit segments. But I'm very, very clear that I'm going to be doing only quality growth. Between quality and growth, I will prefer quality definitely because I cannot afford to have any dip in my quality of the book. Therefore, if that means I need to forgo a little bit of growth, I'm fine with that. So I want to do a -- we are in it for long term, and we need to definitely do all the right actions for the short term to ensure that we clearly reorient our balance sheet and P&L for positioning it for much better way to exploit the market opportunity coming as we go along the various quarters. So while I do that, I will strengthen all the other key infrastructure required for running a good bank in terms of improving our collection, in terms of improving our -- strengthening our legal recourse and recovery through legal recourse, to improve our good operations, ensuring that there is no conflict of interest, there is a good training of all the manpower happening, there is a good science getting used for coming out with preapproved offers for various products, et cetera. So we are putting all those very, very fundamental blocks which are required for creating a good institution, which is what I'm trying to drive at.

And in terms of asset quality, this is my last question, we have seen that last 2 quarters, as you highlighted -- no, in the last con call also, is going to be a bit of on the higher side in this quarter. So thankfully, it has come lower than our expectation. But going into second half, how are you seeing now in terms of asset quality that things are going to look like...

It will be -- see, I don't want to really double guess because we really -- none of us know that what will happen 2, 3 months down the line. Because, if you recall, when we were all talking in February, March, we never anticipated COVID would happen. So while I don't want any mishaps to happen, but having said that, we'll continue to maintain that we will have a -- we are looking at slippages of INR 2,300 crores, INR 2,500 crores for the year. But I believe that we'll be erring on over -- under-promising and over-delivering.

The next question is from the line of Jai Mundhra from B&K Securities.

Congratulations on detailed disclosure. I also wanted to check, sir, 2, 3 things. One, on asset quality, if you can give the recovery and upgrade and write-off facility for this quarter?

Any more questions or you want me to answer now?

Yes. So then, sir, on this entire ARC transaction, if you -- I think this is what leading to this negative in the other income thing because you have made a treasury profit, and there is a treasury -- and there is a ForEx profit also. But the treasury plus ForEx is negative because you have had a large hit on investment depreciation. And it looks like it is mainly from ARC sales.

Correct.

So if you can -- maybe you can tie these things together, then what was the ARC transaction? How much -- what have you got? Yes.

I'll give you. First of all, I want to appreciate your incisive understanding because this is something which actually I look forward to from good analysts. So first of all, I must thank you that you've really seen the numbers and I really wish to place my appreciation. Because this is something which people miss it and they generally look at the final number and comment on that. I'm very happy that you actually look into the details. So just to give you a sense of what actually we have done in terms of ARC. See, we have done 3 transactions of ARCs in this quarter. Basically in terms of -- in total number of accounts sold, we have sold about 29 accounts, and we have cleaned up gross NPAs close to INR 1,049 crores, on which we had held a provisioning of INR 561 crores. So net NPA of this account sold is INR 488 crores. And we have got a sale consideration of INR 578 crores. Therefore, we have received a cash of INR 94 crores, and there is an investment in SR made of INR 484 crores. And therefore, we made a provision of about INR 142 crores towards SR. So if I want -- if I need to give you a breakup of this gross NPA of INR 1,049 crores, what is the segment breakup, corporate is about INR 899 crores, close to INR 900 crores, and B segment is about INR 149 crores, which is adding up to INR 1,049 crores. So this is the detail on the ARC. And we have done -- actually, there are 3 transactions and -- of which 2 transactions were with multiple accounts and third one is a pure cash transaction of only 1 account. So -- and therefore, these provisions which we have made of INR 142 crores, this is exactly like the way you put it, this is appearing in the other income, which is depressing the treasury income which has been made. That's the reason why our total income appears to be showing as a drop, whereas it is not really so.

Understood, sir. And then you can highlight, sir, how much was the recovery and upgrade and how much was the write-off, including this or maybe excluding this?

Yes, yes, yes. In a total advances as of Q2 year-end -- I mean Q2 end is at INR 58,309 crores. We have opening GNPA, we had about INR 4,677 crores. We had a fresh slippages in this quarter of INR 531 crores. We have recovered -- GNPA recovery alone is INR 282 crores. And ARC sale is about INR 1,050 crores. So we ended with a GNPA closing of INR 3,880 crores, which is about 6.65% of my advances book.

No, sir, just to reconfirm, the recovery and upgrade, including cash recovery, was INR 282 crores?

From the NPA accounts. We have also recovered from fully written-off accounts. From GNPA recovery alone is INR 282 crores. Just to give you the overall collection, what we have done in the first half is what we have done for the full year of last year. In fact, we have actually upped our target for the year for the team. We have already -- initially only I gave 2x the target and now I update even up further. So we are -- actually, that team is clearly shaping up very, very well. And I'm pretty hopeful that with the good collection and recovery, you know that we can confidently go and build a quality asset book.

Right. Okay. And when you say collection efficiency at 91% for September month, is this -- I mean, the number looks slightly lower, right, because we thought that everything would normalize?

You're right, you're right. It's slightly lower. I think we need to -- we need to up that. And if you look at, for example, August we have done more than 100%, 108% is what we have done. Whereas for September, it's a little lower. I mean, these are all -- I mean, you know that these aberrations will keep happening in the month, we will correct it. It's not something that...

What should be the normalized number? I mean, I understand it cannot go back to less than 99%, but what could be the, let's say...

See, you need to look at it this way. Basically, collection -- if I were to really articulate the way I look at the whole collection is there are 2 distinct ways of doing collection. One is the retail collection and another one is the non-retail collection, okay? Retail collection typically happens through -- in all the large banks and all the retail banks, it happens through collection agencies. And non-retail generally happens through employees who are doing [ door-to-door ] business. In this bank, we have actually -- we hardly had any agencies for doing retail collection in the past. So the entire team of collection agents actually doing collections, we have actually put it in place just about a few months back. So -- and we have also beefed up with some of the best agencies who are doing excellent work for many of the large banks in the country. So that -- and we have recently taken a collection and recovery head who has just taken position. It's just about a month since he had joined. So after his coming in, and he has got a rich retail SME collection and business experience, so with him coming in, a lot of traction now we are seeing in the way retail collection is happening. Now we have just seen a very, very small output from this thing which has been set up. Going forward, we will definitely see a lot of ramp-up happening in collection front. As far as SME and, of course, non-retail collection, it happens through employees. And there, as we have been talking, I've been doing a weekly review of recovery in collection, where I look at SMA-0, SMA-1, 2 and NPAs. And that is something which the trigger is continuing even today. That's the reason why we are able to do very well in the collection recovery front, so which I'll continue to do. But we will definitely start seeing good traction happening in retail collection also. Particularly in retail collection, if we've had to look at component which is giving us the headache, it's in the area of LAP and home loan, which traditionally used to be a very decent book for many large banks. So we definitely need to correct our -- whatever we've been erring on that side, which we have done on the sourcing side, and we'll continue to do that. Now collection side, we need to speed up so that we are able to manage it well. But as I'm talking to you, if you had to look at collection efficiency product-wise, housing loans for July was 100.3%, for August 99.7%, for September 102.8%. Vehicle loan, 99.9% for July, 100% for August and 101% for September. Mortgage is 103.6% for July, 97% for August and 102.9% for September. So they are all now falling in place. Now it's a question of going and cleaning that up, so that we -- and it's not a very large book. As you know, retail book for us is not a very large book. So once we clean this up, I think, with the way now the teams are put in place, we'll be able to see good traction happening in the business volume.

Right. And sir, just last 2 things. One is you had mentioned that you will be retaining your INR 2,400 crores, INR 2,500 crores of gross slippages estimate that you had at the beginning of the year. Is that right?

Yes.

Right. And secondly, sir, if you can also highlight the, let us say, recovery, how should one look at recovery and also the, let us say, provisioning requirement, because historically, your ARC sales have not -- I mean they have given a shock in terms of maybe after 1 year, 2 years down the line when they are coming for MTM. So while you have had -- if I look at it now, you have 50% provisioning on ARC book. But what is your sense? Would this require some more provisioning as we go along? Or how should one look at the recovery upgrade and the provisioning line item?

You are right. It's not only this bank's experience, it's been the experience of many other banks also in the industry, that ARCs for various reasons have not been able to live up to the expectations of the lenders. Quite honestly, if you were to look at last 1.5 years, I think they are also operating in the same ecosystem, which we are all operating. And we know how much of ecosystem are supporting or not supporting the collection and recovery. Many of the courts where we did not have people to take calls, et cetera, many of the restrictions were there in terms of movement, et cetera. So I think there is a bit of consolidation happening even amongst ARCs if you look at it. So the communication today which is happening with ARCs is also that we are not too happy with the way things have happened in the past. So they are also -- now whenever they buy a portfolio, they're also factoring what is likely to be because they are also taking part in the investments. If you look at 85-15, they also take part in SRs and so -- and many of them, their capital and all is very limited. So they [Audio Gap] promise, over promise and under-deliver all the time. So we are quite conscious of the past history of the ARC. That's the reason why we are also proactively looking at how we can accelerate the provisioning, so that we are not seeing too much of fluctuation going forward. But if indeed the collection improves which is what I'm hoping because with the way now they have also revamped their teams, et cetera, now they are also very carefully looking at before they commit any sale value, et cetera, they look at the feasibility of collecting money from each of those underlying accounts. So all that rigor is now going into them also before they purchase the pool. So I think it's going to be definitely a partnership, which we need to work with them to ensure that both of us meet up with our expectations. So we'll see -- we will have to take it as it comes. As of now, we will -- and I will anyway be sharing with you as we go along how we are faring in that. So we will always take the right action to ensure that we don't slip on those.

The next question is from the line of Vibha Batra from FairConnect.

My question is again on this ARC sale. You said that gross value was INR 1,049 crores, you already had provisions of INR 561 crores. But still, you made INR 144 crore provision. So if your debt value was already INR 488 crore and you received INR 578 crores, what is this INR 144 crore provision on account of?

It is additional provision which we are keeping. This is exactly what I had answered in my earlier questions, this is just to be on the conservative side.

Okay. But when typically ARC invest, they do the fair value of the transaction. As per that fair value was INR 578 crores and you were carrying INR 488 crores, despite that you took additional provision?

Correct. Correct. Yes. We -- see we also had a -- see, if you recall one of the questions, I'm sure, if you have been part of analyst calls, so something which we have been always asked about is PCR ratio, net of rate of gross of -- all that is something which we keep talking about. So we -- in order to ensure that we also meet up with the overall beefing up our PCR ratio et cetera. We thought it made sense to be cautious on this. So we are -- that's why we have provided extra also on this.

Okay. Okay. And what is your sense on recoveries...

No, no. One second, and one more clarification, one more thing which I need to tell you, the provision of SRs also as you said rightly, it's all based on a net asset value declared by ARC. However, for the SR investments made after 2018, March 31, 2018, the provision for SR is done assuming that the loans notionally continue in the books of the bank.

Okay. Got it.

So if they continue in the books and if they deteriorates and move into the next bucket, corresponding provision we need to keep. So this is as per the guidance. Therefore, 2018 -- it's been introducing from March 31, 2018. So this is something which is in tune with that we have kept.

Okay. Okay. Got it. One last question is cash that you received on 1 account, INR 94 crores. What kind of a head back was that? And was that one account?

Sorry, INR 94 crores we have received, what was your question?

We received cash on 1 account you said. You received INR 94 crores. I don't know if I heard you correctly.

You know that we have ARC. 100 -- 85-15. 85% of the consideration is by way of SR. 15% is the mandatory thing which any ARCs will have to repay at cash.

Okay. Okay. Yes. It's not 1 account, which got settled. Okay. Got it.

No, no, no. It is that 15% of INR 1,049 crores, which we talk.

Okay. So the current book of NPAs that you have, what is your sense on recoverability from gross NPAs, not over 1 year, say, over lifetime?

It's a very difficult question to answer. I mean, obviously, we are -- we -- I can only talk about how well we are doing in the recovery as against the -- recovery and collection as against the targets which we are keeping it for ourselves. The -- my goal for 2024 March, as stated in my strategy document, is to bring down gross NPA levels to the range of 2.5% to 3%. That's what we want to aim and work towards. So that can happen, in my view, based on 2, 3 initiatives. One is clearly, we will have to keep adding good quality portfolio so that we -- our denominator with a good quality portfolio will keep adding up, which will obviously bring down the -- as a percentage of this [ list ] asset, it will come down as a percentage. Number two, we'll have to continue to do resolution of our GNPA cases, whether by going for a settlement or legal recourse or any of those various measures which we have. And we need to constantly do a good collection in the SMA 1, 2 books so that they would slip into future NPA. So this is a continuing exercise, I think, which we need to do. Right now, as we are talking the last 1.5, 2 years, we all had the disadvantage of economy not being very supportive. There are lot of headwinds in terms of improving your denominator by way of assessing -- I mean by way of sourcing more and more new cases. Now with things which are coming onboard with whatever we are seeing as traction from mid-July onwards, we expect the growth to happen in the asset side. And with our emphasis on quality assets, we believe that denominator will be with the good quality assets coming into the book and with the numerator getting cleaned up through various measures, overall GNPA management will keep happening. And anyway, we will take stock every quarter and see how to manage it so that we are able to get good recovery. At the same time, we are able to meet up with the expectations which we have set out for ourselves.

Okay. And your rating continues to be on negative outlook in stressed assets. They have given stressed assets at 13% by adding the use of NPA which would be...

Obviously, when the rating agencies did this they were -- they did it before this quarter end. Now I -- but you should also recognize that rating agencies have maintained their rating -- both the rating agencies have maintained their rating because they also saw a lot of merit in the way the bank has been putting its strategy in place and the way the bank is going about transforming its various functions and divisions. And therefore, they are quite happy with the fact that the structures are in place and right action is happening, et cetera. So they are almost -- they will keep watching. See, all said and done, they are still not out of the problem. They -- as I'm seeing, this year also, we are expecting [ INR 2,000 crores ] slippages to happen, which means clearly, we are in the midst of the storm as we are talking. So every quarter, we are experiencing. Last quarter, I had INR 800-plus crores of slippages. This quarter, I'm talking about INR 500-plus crores of slippages. Though it is lower than what we had originally envisaged, but still it is a high amount. Therefore, we are still in the midst of things. So till that happens, I don't expect them to be lenient towards this. They will continue to maintain internally, which is fair also from their side.

Okay. And do you have a guidance for risk credit growth over -- till March '22? Or...

No, I don't want to give any guidance for credit growth because it's purely dependent on how well the market is reviving and how -- what kind of quality assets are present in the market. We don't want to grow for the sake of growing. We want to really grow by acquiring good quality assets. Because I don't have the room to go just increase my asset base. I need to do a proper -- good job of putting in right cases so that as a complex -- as a portfolio quality, I wanted to move from whatever it is today to much, much quality level.

The next question is from the line of [ Duby Rex ], an Individual Investor.

Sir, it's been 3 quarters since we have disclosed the Vision 2024 strategy document. Are we still in track? And what is your feedback on it? Are you happy with the progress?

Yes. So see, let me give you a little bit of a context there. See, Vision '24 document was formulated in the month of September last year, and we presented it -- we made it out by something like November. So when this was in the midst of COVID 1 and COVID 2 was not anticipated at all. And clearly, whatever was happening in April, May, et cetera, obviously, no one could have foreseen. So whatever we had out spelt out as a strategy document was, of course, taking into account that we -- this is what we needed to do for the bank in order to look at the various metrics by which a bank's performance will be measured. So we have put our own wish list of where we want to be by end of '24 March. But in April -- and this, we stated as a strategic intent. We said that will drive profitability growth through quality credit using 6C strategy, where we articulated where we want to be in all these Cs which we're talking about CASA, capital adequacy, cost-to-income ratio, competency building, compliance and customer focus. So in all of this, I would -- I'm happy to say that in every one of this, we have shown good progress in all these areas. And capital adequacy, I'm sure all of you who have been tracking this institution for some time will know that we are now sitting very comfortable at about 15.7%. Clearly, my goal is to really be on par with some of the best-run banks of -- looking at 18% capital adequacy, which is what we are targeting though our strategy document talks about comfortable range of 16% or something like that. See, yes, with respect to CASA, we have clearly seen a track from 25% level to 30.78% as I'm talking. Now you should remember that with the way we are now improving the franchise of NR, TASC, government and retail, these are the 4 channels by which we are increasing our CASA and with our restrategizing the customer target segment, which you want to really reorient, which we believe that with more and more new asset customers getting onboarded and with the way our retail liability is going to be geared up for sourcing more and more of CASA, more and more of doing cross-sell, identifying good-quality customers to be onboarded and getting more and more salary mandates, working with the corporates and through an ecosystem where we tap all their potential business opportunities, et cetera, we believe that quality of accounts which we'll be adding will be far more. So with all that, I'm hoping that though I set out a target of 35% for March '24 as far as CASA is concerned, I'm pretty confident that we'll be able to reach that level much before that. As far as competency building, I spelt out what all we are doing. We have completely mapped our leadership team. Our top 60 people of the bank, we have completely mapped their leadership capabilities, and we are working as a team to bring out our best, and this team is working without any boundaries and all of them are really passionate about doing -- bringing about this transmission, which is happening in the bank. And a mid-layer and lower level of management is concerned, there is a whole lot of initiatives which we are taking to build their competencies, both in functional as well as in the soft side through building e-learning modules, and we are now acquiring a learning management system, with which we'll be able to make our employees learn in their own leisure time and really keeping them with lot of skills, with which we believe that a big efficiency and productivity improvement will happen. As far as customer focus is concerned, a lot of initiatives we have taken on the technology side. With all that, we believe that -- and we continue to feature among the top 10 banks in the digital index, which Government of India is bringing out. And our digital traction is more than 92% of our transactions happen through digital tools. So with all this, I believe the customer focus, customer convenience, all this has really given a lot of importance. And as far as cost to income, this is one area where I must say that we are still to do a lot of work. This is primarily due to 2 areas. One is the income as you said, as we've been talking about, income definitely has to come from more and more of asset buildup happening with more and more a better margin business coming in and with the market also supporting us for growth. Now market supporting us for growth clearly suffered due to COVID, which we have started seeing traction now with which that will improve. As far as high-income product is concerned, I mentioned about how we have made traction with now gold loan, credit card, PL, with which we'll be definitely looking at high-yielding product, which were compromising on quality. Third thing is as far as cost is concerned, we have bring -- brought in lot of efficiencies in many areas. But as far as the employee cost is concerned, because of the settlement which happened for -- at IBA, where institutions follow IBA structure, we clearly need to follow whatever is the settlement which happened. And that, in fact, is something which I need to carry it in my books and I have no choice on that. So that is something which will definitely is hitting us a bit much more than what we had originally envisaged. But given that what it is, we need to see how we can work on other areas so that the ratio is broader. And as far as this employee benefit is concerned, you must have heard about recent guideline where family pension thing which was talked about, where regulators have given a concession for all the institutions to take the delta hit over 5 years, but we did not want to take it for 5 years, we want to provide for it completely in 7 quarters. We want to complete everything by March '23 itself. So we -- wherever it's possible for us to take -- do the accelerated provision towards that, we are taking those accelerated provision also. So the way I look at cost to income becoming better and better is by improving the income on one side and being completely efficient on the cost side by constantly working on leakage of income, constantly renegotiating with vendors, bringing a lot of efficiencies, et cetera, and also doing lot of sourcing through digital, sourcing cost for a digital sourcing is obviously far lower than an employee cost. And we're also looking at DST, DSA models to bring down the cost of business. So with all this, we believe that even cost to income will be brought under control. Though it is a little longer journey, but we'll get it. And as far as compliance is concerned, clearly, I have articulated that we'll have 0 tolerance on fraud, and that's something which we are going full on. We are not compromising. Clearly, we are seeing that in terms of the Quick Mortality, et cetera, coming down. We are also seeing very less number of cyber frauds, et cetera, happening. So I think all these are moving in the right track. So one word, whatever strategy which we set out to do in all the areas we are seeing good happening, I think the team is doing a great job, and the team is motivated to really bring about this change and I am quite confident that we will be there. Of course, while doing all that, how do we fundamentally correct some of the issues which are plaguing the bank, that is something which we are clearly addressing it by taking selective actions every quarter towards that only this PCR implement, gross NPA management as well as the CASA growth and all other things, costs of funds continuously being brought down by efficiently deploying our resources and going and tapping all low-cost resources, et cetera. All that is being put in place.

Sir, regarding the hiring, is the most of the hiring done or the trend continues, sir?

We have done whatever is required for hiring for the various verticals and business groups, we have done the hiring. There is a little bit more hiring, which we need to do on the control book, especially on the credit side. Now with the traction happening in the number of applications which are getting particularly in the business segment, et cetera, we believe that we need to keep the team with a lot more resources. That is something which we are doing. So we are giving critical -- increasing critical number of resources for some of the key control functions, like collection, credit and legal. These are some of the areas where we are recruiting now. But otherwise, business side, more or less, we have done. Most of the other recruitments will anyway happen through DST, DSA, which is essentially for sourcing.

May I request Mr. [ Rex ] to please rejoin the queue. We have participants waiting for their turn. The next question is from the line of Prabal Gandhi from Antique Limited.

Sir, am I audible?

No. Mr. Gandhi...

You can come a little closer and speak probably, not very clear.

Is it better, sir?

Yes. Yes, better. Yes.

Sir, on the slippages side, we have seen higher slippages showing from the agriculture side. So if you can explain that?

See, this is completely...

We have around 5.5% slippage from the agriculture side.

See if you look at the overall slippages, it's a very small amount. So we are not really concerned about it. But to answer your question, these are all basically the KCC -- see, KCC, as you know, we actually -- in fact, I would say most of them are due to KCC. And KCC also, why it is happening is that you know that interest dues, et cetera, we have given them a very long -- as part of the bank's policy, we have given them very long time for repaying those interests. So I think from 360 days is what we had kept and then it was extended to 720 days. And this was basically due to the floods, et cetera, which happened in Kerala, many of them got hit badly due to consecutive havoc due to natural calamities, et cetera. So -- but having said that, I think there is a good effort being put in by the team now to go and recover from KCC. As I'm talking to you, Q2, we have seen good traction happening. Frankly, I was anticipating much more slippages there, but the team was able to actually bring it down. So the good news is that we are seeing traction happening even in the collection from those accounts. But the flip side is that they got really impacted due to floods and the consecutive natural calamities happening in Kerala, particularly. And this being our largest region where we have done a lot of -- more than 50% of our sourcing. Clearly, this is something which is impacting us. But if you look at whether it is really worrying me, because in the overall scheme of things, it is not very large.

Got it. Sir, and on the coverage ratio, so 'what would be appropriate conversion of [Technical Difficulty].

See, we are talking about PCR, excluding write-off, we are at about -- currently at about 43%. See quite honestly, this is something where I clearly see -- I don't want to give a guidance, et cetera, but my endeavor is to take it to 50% level, but I don't want to commit a time line by which I will do because this is purely dependent on how well the market is going to be responding and how well the opportunity for business is going to happen. And so if I keep adding more and more of good quality cases, et cetera, clearly, the -- and if the market is conducive, then we may not see too many slippages happening in which case our provision can come down. So as I'm talking to you, if you ask me my wish is to take it to 50% level.

Sir, can you give the segment-wise PCR, so that we have a better understanding of the book?

I don't think I'll have segment-wise PCR. No, I don't think I'll be able to answer. Maybe we can probably get back to you.

Yes. Sure, I'll take it off-line.

But right now, I don't have. That's something should...

Sir, just last 1 question, so you shared your disbursements of INR 10,000 crore in the first half of this year, which amounts to around 20% of the starting book. But if I compare across segments, we have seen a decline across every segment, whether it is retail, whether it is business loans. So if you can share the disbursement breakup also, when we have [Technical Difficulty] standing how this growth is going to pan out. Because the repayment pressure seems to be quite stronger.

May I request Mr. Prabal Gandhi to please repeat your question, sir.

Sure. So I was asking that the disbursement in numbers that you shared were around INR 10,000 crores for the first half. So if I compare it on the original loan book, the starting loan book, it comes to round 20%. But across the segments, we have seen a decline in loan outstanding. So if you can share the disbursement breakup across segments, then we can have a better view of where the growth is going flow in from there.

No, I'll tell you where the growth -- basically, this -- if you look at even this growth which you're talking about, this primarily has happened with a little bit of traction started happening from July onwards because the entire team was set in place by the end of first quarter. So to that extent, the ramp-up has happened. I mean the growth has come predominantly in the last 1.5 months of activity. As I'm talking to you, retail anyway the numbers, et cetera is shared, where we have touched about INR 100 crores of personal loan per month -- only in the month of September, and we are talking about credit card, et cetera, being a very small number. So corporate it's where predominantly, we have been sourcing A and above kind of rated cases, et cetera, is what we are sourcing. And that is -- there, we are also seeing some good opportunity in very short-term products, where if we are looking at a AAA kind of constitution, which is looking at, let's say, INR 500 crores of this discounting, et cetera, for 90 days, 120 days, 180 days, et cetera. Even those are -- and it's a repeat business, and that is something which is helping us also to source a better quality case and with a potential for earning -- since as a bank, we still continue to carry surplus. You know our CD ratio is quite low. So therefore, we still have a surplus. So we are really looking at the opportunity to deploy this wherever we are seeing. Credit-wise, it's meeting our standards and delta profit-wise now-a-days it will be this thing. So predominant this thing has happened from corporate, gold, business segment these are the top 3 segments.

Sir, and since you mentioned about the surplus that you're having, can you share your outlook on margins in the medium-term and the near term on NIM?

See, margins -- frankly, the margins in the market today is extremely low. Market is actually following predatory pricing. We are looking at SMEs being offered 7%, 7.5%. Corporates are asking for rates of 5% and 5.5% and 6%. So if you are expecting margins to improve, I think even the larger banks by virtue of their book size being very large, the incremental business and margin probably may not be making -- moving the needle at all. So therefore, for a bank of our size, et cetera, clearly, margin is something which is going to suffer for some time. So I don't want -- I'm not really keen to give a big guidance, et cetera, because today, we are not in a phase where sensible pricing is happening. So I'll be -- I'll continue to earn whatever 2.6%, 2.5%, 2.6%, 2.7% kind of margin because retail, which I am doing currently at, let's say, 12%, 13%, 14%, with a better quality. But the delta which gets added through this is a very small portion, considering the overall book size. So unless you really see market helping us to really ramp up retail in a big way, which is also comparable to the book size, then you'll see the overall margins moving much better. But as of now, my margins are clearly on the lower side, primarily because of retail, just started to doing some -- showing some traction. And we are looking at quality, therefore, we don't want to compromise on quality. Therefore, we are -- and we have surplus, therefore, we are using that to really build a good quality asset, though it maybe a very short-term kind of product, but we want to ensure that quality doesn't suffer. That's where it is.

The next question is from the line of Saket Kapoor from Kapoor Company.

Sir, as you have explained that a lot of effort has to be put to rationalize much more of our cost -- of operating cost also. So what should be the trajectory going forward? Because if we compare your other operating expenses, they are not commensurative to the -- to our income. [Foreign Language] They have gone up disproportionate to what the income has been. So how would you explain this? And going forward, what should be the trajectory on these other operating expenses?

See, if you look at the -- this is what I explained earlier also, cost income will start becoming -- see, the better-run banks are obviously operating at a level of 40% and below. So when we look at our cost to income, but for the fact that we have taken accelerated impact of the [ FPS ], et cetera, which we wanted to provide it in next 7 quarters instead of 60 quarters, which regulators have given us. If you back calculate that, we would have been at about 53%. So as again should -- I mean whether a 53% is the comfortable, I'm not comfortable. Obviously, I want to bring it down below 50%, and I want to bring it down below 45%. That can happen only when even the denominator also starts going up. Why will denominator go up, only when the market becomes conducive for you to do more and more asset business, which is what we started seeing traction in the last 1.5 months. So I think you need to have patience to ensure that we keep building good quality assets, which will start improving our overall income, and we also need to tap all the opportunities which are there. And we will continue to rationalize our cost by bringing in more and more efficiency. See we also added a manpower. We also added a few natural resources. We have also taken the hit of the IBA negotiation, et cetera. All that has started reflecting only this year. So with all that, your cost is clearly appearing to be on the higher side compared to the potential of income, which otherwise, in a normal year, we have seen a propitiate increase in income happening, but due to economic situation, due to our own situation. We also don't -- we were also cautious in not wanting to grow just for the sake of growing. We want to first get the infrastructure right so that we don't error on the quality again. Therefore, that's the kind of restructuring required about 5 to 6 months to put it in place. And once we put that in place and with people taking position, et cetera, we had a good 1.5, 2 months in this quarter to start showing some results, which is now what we are seeing. So I will be happy if I can bring it down to sub-50% ASAP. And my goal is to bring it below 45% over a period of time.

Sir, on the slippage front, you have told that this year also, we are anticipating INR 2,100 crores to INR 2,400 crores in totality. Out of which INR 1,300 crores is what we have provided for the first half. This is what the guidance should be, sir?

Correct. Correct. Yes.

So going forward also, we are expecting...

We continue to hold that guidance though we have actually seen lesser in Q2 compared to what we had envisaged. We had envisaged INR 650 crores, we ended with INR 530 crores.

Okay. So sir, second half also similar numbers only we are expecting at least...

Yes. Whatever INR 2,300 crores, I mean if you ask me 10 times also, I'll say the same thing. We are giving guidance of INR 2,300 crores, INR 2,500 crores for the full year. We want to -- we don't want to overpromise and underdeliver. We will try our best to bring it down, but I don't want you to reckon that at this stage.

Sir, taking into account that since the pain is not out of the system, [Foreign Language] how long will we this wait for your shareholders who are interested? I can understand sir that you have a Herculean task of first cleaning up, then realigning things, then looking at cost and then creating profit. First, it is -- we are at the bottom to receive anything, if you take the structure. It is first your business, then your customers, then your staff and whatever would be left after that would be attributable to your shareholders. So to sum it up, sir, how -- what kind of journey are your investors looking forward -- going forward? You have given a time line of '24 and all...

I think it's a very valid question. Frankly, it's a very good question. And whatever -- you must really acknowledge that whatever we are trying to do is basically to build a institution which can work very efficiently over a period of time. See, as equity investors, you know equity investors, and I'm also an equity investor, therefore, I know that we are into equity because we are willing to take the risk. So your question of how long do I take the risk, et cetera, it depends on your risk appetite. So therefore, if you're asking me as a person who is driving this institution, what is my goal? My goal is to turn it around and build an institution, which has got all the right ingredients so that it can continue to produce a lot of profits over a long period of time. But when an institution has been set up in a certain way, and it has been delivering profits for some time. But due to various other things, when it's going through down phase, precisely we are talking at a stage when it has seen the bottom, when it is seeing the bottom. And the market is also not helping us because the economy has also not been doing well for the past 1.5 years. And particularly, this bank has seen the natural calamities hitting the bank consecutively year after year. Therefore, this state, which has -- where 50% of the branches have present hasn't seen a normal year for more than 4, 5 years now. So you are talking about an institution, which has not seen a normal year for 4 to 5 years because of which a lot of things have happened in the portfolio. Now a person trying to come here over last 1 year trying to pick the basic building blocks and put them in place and starting to accelerate the engine and carrying it forward to arrive at a speed of what anybody would expect, is going to take some time. Now I really cannot answer your question. How long you need to wait. My idea is not to make you wait for long. My idea is to not to make you wait at all. But it's not something which is going to happen in 1 day or 1 month or 1 quarter or 1 year. It is a journey -- because if anything which can happen in 1 day, 1 quarter, it can also go down in 1 day and 1 quarter. That is not something we are trying to create here. If I want to just show some this thing, if you can go and distribute the money and you can show asset growth and then you are happy about the NPA coming down because percentage-wise it would be coming down. But then it will create a lot of pain for many, many quarters to come. Therefore, I don't want to take any shortcuts here. I want to really put a good building block. Now I think you have been patient enough till now. Just endure for some more time, I'm sure you will not repent. That much I can tell you.

Correct, sir. So we can understand you detailed point on the same. So we hope that your thought process and the steps which you are taking do bring out the changes. Sir, what we are seeing currently is that, sir, key players, technological players like PayTm and all, they might be turning out to be competitors and also they would be the people who would be looking for franchising -- franchises like you to take your credit liability and create that -- use the technology of -- and going with lending and all in that way. So going forward, any tie-up or anything of that where you can leverage your book and create that partnership with leading institutions or with a tech player as has been the case in other geographies of the world? So any thought process on that? Or we are totally within traditional book?

Yes, yes, and I think actually we have made a good headway into it already. You are perfectly right. I appreciate your understanding that this is exactly the way forward. We shouldn't really look at fintechs as competition. We should look at fintechs as partners. Towards that, we have already started associating with a fintech for our gold loan. And we are -- as I'm taking to you, we are exploring a couple of such opportunities where we can -- we are wanting to tie up with people so that we can leverage on their technology capabilities and we can use our distribution strength. Currently, obviously, I cannot reveal any of those names, et cetera, because it's all very, very initial stages. So as we go along, if you ask me whether we are thinking on those lines, we are not only thinking we have made good headway on those lines. Whether this is something which is needed to be done, obviously, it needs to be done. And clearly, bank is not shying away from taking that this is the way to go -- move forward. The entire digital growth -- in fact, I have elaborately in which I talked about how we are [ equity margins ] through technology assets, which we are building across is essentially to make sure that the bank is well invested in technology products to be ready for [Technical Difficulty] the digital ecosystem, which is going to come in. So for that, definitely tie up with fintechs are a must. And as I am talking to you, we are also -- we have also finalized for vendor and dealer financing partnership with a fintech with -- through which everything will be done through the platform. Similarly, for retail, LOS, then end-to-end thing will happen through our platform. So once we create the platform, once we have the credit models in place, that it is your imagination to go and clearly define your risk appetite, and you can tie up with anybody because you know that even they source jump, you can get them rejected because your credit system is strong. So once we build that capability, then it is -- then the sky is the limit. You can actually go and tie up with anybody and everybody. Of course, depending on whether their culture and risk appetite matches with yours.

Ladies and gentlemen, this was the last question for today. I would now like to hand the conference over to the management for closing comments.

First of all, I want to thank all the analysts who have taken part, and we are still going through very tough time. So please take care of your health. And second thing is, I'm very happy to see a lot of good quality questions, not really going by the opticals of the numbers, but really wanting get into details of what the management is trying to do and where management is seeing traction happening and how management is wanting to bring more changes and such questions I think it is very, very encouraging, and I really be happy to really be giving explanations for those questions. I'll really encourage more and more such questions to come rather than some optical questions, which is actually not helping any institution also to correct themselves in the right way because just to give answers, they might do something which may not really be good for the institution. I'm very glad that some of the questions were really incisive and I do think hard I have to do some homework and that is something which we really appreciate. And I continue to reiterate that we'll be as transparent and as open as possible, and we will share whatever we think should be shared with you. And wherever we believe that it's something which is going to happen based on our reasonable judgment, we are reiterating them. And wherever we believe that we are -- we assess something, but which is not happening the right way, we will be open to coming and sharing with you in all faithful and honest disclosures. So I will continue to be engaging with you. And once again, thank all of you for taking your time out and helping us to elaborate and explain these numbers. Thanks a lot and take care of yourself. Bye.

Thank you. On behalf of DAM Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.