By Ankur Mishra
Yes Bank is expecting a loan development of 12% in the next monetary year (FY22). In an interview with Ankur Mishra, managing director and chief executive officer Prashant Kumar says the bank is aiming to attain a credit/deposit (CD) ratio of one hundred% in the present fiscal. Excerpts:
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What is your loan development target for the present monetary year?
There is no loan development target for FY21. However, we are expecting a loan development of 12% in the next monetary year (FY22). In the present fiscal, we are aiming to attain a credit deposit (CD) ratio of one hundred%. Till December finish, the CD ratio was 116%. From the balance sheet management viewpoint, it is crucial to attain one hundred% CD ratio. That, we would be capable to attain by March-finish.
What provides you self-assurance for 12% credit development in FY22?
For loan development, there are couple of issues which matter. First 1 is the out there chance in the program. The second 1 is your preparedness. The preparedness comes from the balance sheet side, and competency. So, we are expecting Covid-19 influence to come down, and from the next year possibilities will be there. On the liquidity side also, we are pretty comfy now. We have currently constructed up our teams to take care of the requirement on all the 3 sides – retail, MSME and corporate. So, we are confident on the credit development, unless there is some adversity in the atmosphere.
By when do you see advances and deposits at the levels of pre-reconstruction period?
The levels rely on exactly where you would like to examine. The retail deposit create-up requires time. So, it could come about someplace at the finish of the monetary year 2022 (FY22). On the loan side, we are a bit cautious on not going for a quite aggressive development. Because, if you go for an aggressive development, at times, you could land in problems as far as top quality is concerned. We will be watching the atmosphere quite closely and we would want to develop in line with the marketplace.
Your proforma gross non-performing assets (NPAs) are close to 20%. Do your suspect the asset top quality to deteriorate additional?
We are at the peak of it. Most of the issues have occurred simply because of Covid-19, and now there is an improvement. There are particular indicators for it. Collection efficiency is now at 96%, as against pre-Covid level of 97%. The cheque bounce price, which was generally at 7-8%, rose to 18% in the course of Covid, and is now at 9%. So, we think it is at peak and from now on there will be an improvement.
What is your road map for the recovery method?
We had set a target for recovery of Rs 5,000 crore in the present monetary year. And, we have currently recovered close to Rs 3,000 crore. During the December quarter, we have been capable to do a money recovery of Rs 1,512 crore. So, I think we really should be capable to attain our target by the finish of the present monetary year. In the next monetary year, we would want to do improved than the present monetary year.
What is your technique for the March quarter?
Our technique in this monetary year was more on recovering terrible loans, opening new present account savings account (CASA) and disbursements on the loan side. The disbursement continues to come about. So, we are completely on track. We have decided to concentrate more on retail and MSME (micro, compact and medium enterprises) than corporate. In term of deposits, we are adding new consumers on the CASA side. The target is to add at least 1 lakh consumers just about every month. We added 85,000 consumers in December.
What is your outlook on net interest margins (NIMs)?
I consider for the next monetary year (FY22), NIMs really should stay in the variety of 3-3.25%.