Central Bank of India (NSE: CENTRALBK) Q3 2025 Earnings Call dated Jan. 20, 2025
Corporate Participants:
M. V. Rao — Managing Director & Chief Executive Officer
Mukul Dandige — General Manager and Chief Financial Officer
Vivek Wahi — Executive Director
Analysts:
Raju Barnawal — Analyst
Ashok Ajmera — Analyst
Sushil Choksey — Analyst
Amit Mishra — Analyst
Aditya Choudhary — Analyst
Anmol Das — Analyst
Priyesh Jain — Analyst
Ashlesh Sonje — Analyst
Presentation:
Operator
Hello, ladies and gentlemen, good day and welcome to the Central Bank of India Q3 FY ’25 Conference Call hosted by Antique Stock Broking Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. I now hand the conference over to Mr Raju Banawal from Antique Stock Broking. Thank you, and over to you.
Raju Barnawal — Analyst
Thank you. Good afternoon, everyone, and thank you for joining post-results conference call of Central Bank of India. From the senior management side, today we have with us Sri MV Rao, MD and CEO; Sri Vivek Vahi, Executive Director; Sri MV Krishna, Executive Director; Sri Mohindra Dohare, Executive Director; and Mr Mukul, Chief Financial Officer. Now without any further delay, I hand over the call to MD, sir for his opening remarks, post which we will have the Q&A. Thank you, and over to you, sir.
M. V. Rao — Managing Director & Chief Executive Officer
Yeah. Thank you, jeep and very good afternoon to all of you. First of all, thank you for giving us the time. First time, I’m going to just give you the broad highlights, performance highlights on year-on-year basis and then followed by detailed a presentation by our CFO. Our bank’s total business grown by 8.31%. Now it stands at INR6.68 lakh crores. Total deposits have grown by 5.34%, now it stands at INR3.97 lakh crore, wherein CASA has grown 5.72% and the share of CASA, one of the best is a 49.18% of the total deposits. Gross advances has increased by 12.99%, that is 13%. Now it stands at INR2.70 lakh crores and credit deposit ratio, it is improved now is at 68.25 from the earlier December ’23 figure of 63.60. Gross NPA, which was 4.50 in December ’23 has come down. Now it is at 3.86%. Likewise, net NPA, which was 1.27 in December ’23, now it is at 0.59%. Provision coverage ratio has improved to 96.54% from earlier figure of 93.73%. Net profit, which is the highest for the past 15 quarters, that is INR959 crores for this quarter. And for this nine months, we have recorded INR2,752. And if you see the whole financial year of the previous year, it was a 2,549 that is in this nine months, we have surpassed the previous year’s net profit. And coming to the NIM that is net interest margin it stands at 3.48%, which is 20 basis-points higher than the previous year, that is 3.28 in the previous year. Return on assets has increased by-18 basis-points. Now it stands at 0.87%. Return-on-equity, now it is at 12.96% and CRAR, capital adequacy ratio has improved to 16.43% and previous December it was 14.74%. Now this is only the performance highlights just I have given. For the further details, our CFO will be taking you through. Thank you.
Mukul Dandige — General Manager and Chief Financial Officer
Thank you, respected MD, sir. So as given — highlights have been given by MD and CEO, sir. Our profitability, as you would have seen for the last 15 quarters, the bank has been able to give a sustained profitability growth. The 3/4 financial profitability has been at INR2,752 crores, which is 57.98% higher than the corresponding nine months period of the last financial year. And we have already crossed the entire last financial year’s net profit during this nine months period only. If we see the headline numbers, there has been improvement across-the-board with yield on advances at 9.01%, yield on investment at 6.87%, the cost of deposit improving — increasing by only 9 bps to 4.81, which is again one of the lowest in the industry. The NIM being very strong and robust at 3.48%, the credit cost coming down to 0.49%, the slippage ratio at 0.39% and the very, very comfortable liquidity coverage ratio of 233.60% and net stable funding ratio of 140.44%. The ROA at 0.87 and if we consider the nine months ROA, there is an uptick of 22 bps in this and it is a very, very substantial improvement over the last financial year. The total interest income has improved by 8.98% on a Y-o-Y basis and the total interest expenses have improved by 6.72% to INR4,970 crores. Thereby the net interest income has improved to INR3,540 crores, an increase of 12.31% on a Y-o-Y basis. The total expenditure increase has been at 7.88% to INR7,776 crores. The operating profit has increased by 1.66% to INR1,963 crores and the net profit, there is an improvement of 33.57% to INR959 crores, which is the highest-ever net profit recorded by the bank in the quarter. The interest on advances has improved by 10.06% to INR5,689 crores. Similarly, the interest on investment has improved by 10.26% to INR2,590 crores. Thus, the total income has improved by 8.98% to INR8,510 crores. The non-interest income and other operating income put together has improved — I mean, there is a slight decline on a Y-o-Y basis to INR1,229 crores, mainly because of the slightly lesser recovery in write-off accounts. But other than that, it is more or less same. As far as the total expenses are concerned, the interest expenses on deposits have increased by 7.5% to INR4,700 crores. The operating expenses have improved by 10% to INR2,806 crores. The staff cost has improved by IN.69 crore% to INR1,792 crores and thus the total expenses have improved by 7.88% to INR7,776 crores. The provisions, NPA provisions, the bank has made INR310 crores of provision on NPAs. Income tax provision has — has been made at INR448 crores. We have made a provision of INR250 crores on standard restructured accounts where we expect that there might be some impact due to the ECL guidelines if and when they kick-in. So overall, the total provisions have at INR104 crores are lesser by 17.23% on a Y-o-Y basis. Then the asset quality, if we see the gross NPA has come down to INR10,460 crores, representing 3.86% and net NPA is at INR1,555 crores, which is 0.59%. If you see on a sequential basis, the gross NPA and net NPA has come down over the last quarters. The sector-wise NPA classification, if we see the retail is having an NNPA of only 0.08%, agriculture and allied activities at 1.50%, MSME at 1.21% and corporate and others at 0.12%. The provision coverage ratio has further improved and it is at a very healthy 96.54% now. The slippage ratio is at 0.39 and the credit cost is at 0.49%. Resultantly, the capital adequacy ratio of the bank has further improved and it stands now at 16.43% with 14.21% of CET1. The restructured book stands at total INR5,515 crores and special mention accounts of INR5 crores and above total constitute now INR979 crores only with hardly any stress in any of these major accounts. If we go into the details of the business across-the-board, total business improved by 8.31% and it stands at INR6,668,686 crores. The advances grew at 12.99% to INR2,70,779, of which RAM is 1,89,303 and the growth in retail agri MSME was at 17.99%. The risk-weighted asset, if we see, it is at one of the lowest in the industry, despite the corporate credit at a healthy percentage. The deposit front, bank is still able to maintain its premier position as far as the CASA is concerned with 49.18% of the — of the deposits under CASA. Bank has got a very diversified loan book with retail, MSME, agri and corporate being spread evenly. Within retail, which constitutes 29.52% of the total advanced sales and the growth in retail was at 16.18%. Housing loan constitutes 62.95% and the growth in-housing loan was 19.24%. As far as rated standard advances are concerned, the concentration in AAA-rated accounts has increased by 10.02%. In A-rated advances, it has increased by 31.29% and investment-grade advances by 19.12%. The bank maintains its premier position as far as the co-lending book is concerned and the co-lending book is at INR13,757.92 crores as on 31st of December ’24. The treasury is very well-managed with total book size at 1,53,070 and the yield on treasury has further improved to 6.87% as on December ’24 compared to 6.40% in December ’23. The modified duration in PV01 is very well-controlled and — and it is managed in a very, very efficient way. So these were the overall highlights of our performance during the Q3 of the current financial year. Now we would request for any questions that are there.
Operator
Thank you very much.
Mukul Dandige — General Manager and Chief Financial Officer
Thank you.
Questions and Answers:
Mukul Dandige
We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press R and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles we will take our first question from the line of Ashok Ajmera from Ascon Global. Please go-ahead.
Ashok Ajmera
Hello, good evening, sir.
M. V. Rao
Good evening.
Ashok Ajmera
Compliment to you, sir for yet another good quarter in-spite of so many issues, headwinds, a little bit pressure on the operating profit, though the net profit has been managed well with maybe a little lower provision of taxation and little bit of other provisions. But having said that, sir, now going-forward, with this current scenario, like where a lot of news flow and the rumors are around, how do you see the — in the — basically in the commercial bank and mostly in the public sector and some of the large private sector banks, the growth prospects in the coming quarter and the whole FY ’25 ending? Because so-far the results have been good of whatever has been declared. But in-spite of that, you know, I mean, you all know, we all know that the stocks were hammered down very badly. So is there any concern on that front of the growth front or the profitability front, as such? This is my first question, sir.
M. V. Rao
Okay. See, what is the position of other banks, private or larger banks that I do not want to comment upon. Just as far as my bank is concerned, we are very sure that whatever the guidance we have given earlier that we are going to achieve. Earlier, we have given that our — the business growth will be 10% to 12% that we are going to touch that band. Likewise, for your advances also 40% to 15% band we have given that we are going to be there in that band. Likewise, in deposit growth 8% to 10% guidance what we have given in April that continues to hold good and that we are working towards that and we are confident in achieving. As far as the profitability is concerned, anyhow the figures are out that we have surpassed the previous entire financial year’s net profit and we don’t see any break or any kind of a struggle or hurdle in that way to achieve the figures for the March. This is a very simple way of putting my bank’s position and I do not want to comment on the other things what you have asked earlier.
Ashok Ajmera
So sir, point well taken, sir. Sir, similarly on the recovery front, where do we stand and that one big that aviation account, what is the prospect? I mean, is there any progress or any — what are the chances of the recovery and how fast and the overall recovery scenario?
M. V. Rao
See, overall recovery, whatever the amount that we have targeted that we are achieving under-recovery. As far as that one big account what you are referring to, we don’t see any great recovery within this March quarter. Definitely, it will be there in the first-half year of the next financial year.
Ashok Ajmera
So even that unlocking, I mean that collateral we had
M. V. Rao
A lot of inquiries are happening, lot of due-diligence, a lot of things are happening. But unless until it is crystallized, we cannot tell with certainty.
Ashok Ajmera
And sir, you said about the growth and the growth will continue. But now with this new — many of the new norms introduced by and restrictions introduced by RBI on the co-lending space, I mean your retail space by the NBFCs also. And so don’t you think that there is — I mean, too many people are chasing too few good accounts there and there can be a pressure on our retail loan growth also and co-lending growth also?
M. V. Rao
No, we see in some other perspective, is too large. So there is no depth of opportunities. It is only that what is a trade-off you are going to make with your lower rate of interest and quality of advance that is the crux of the entire growth story now.
Ashok Ajmera
So we have been reading, sir that on this lot of delin. There are delinquencies on the personal loan front in the small loan accounts, you know where the defaults are increasing in the recent months. So do we have any such concerns, any such kind of portfolio in our retail loan book?
M. V. Rao
See, ours is a plain vari type of personal loans we have. We only extend the personal loans only to the salaried employees where employer gives the undertaking for deduction and salary accounts are with the bank. Ours is a very limited portfolio and we do not have any type of concerns or issues in the portfolio.
Ashok Ajmera
Okay, sir, last question in this round, sir, on the treasury. On the treasury front, of course, the profitability now mainly going to the reserves, but on the trading profit side and the investment through the equities and IPOs are heavy — we — what could be the approximate ballpark numbers on that on the equity trading front and the IPO investment profitability and some of the other investment in equity?
Mukul Dandige
See, as Vera the total trading profit, if we compare quarter-on-quarter, this quarter it has been INR216 crore against a trading profit of INR151 crore in the December quarter of previous year. So you will see, you will appreciate there is a decent jump. So that is the reason that our yield on investment, including trading profit is now at a very healthy level of 7.32%. A further breakup on — we will provide you regarding the — INR100 crores. Equity share would be around INR100 crore in this, but that will.
Ashok Ajmera
Okay. All right, sir. Thank you very much, sir and all the best to you, sir.
M. V. Rao
Thank you. Thank you.
Operator
Thank you. Before we take the next question, we’d like to remind participants to press R&1 to ask a question. Next question is from the line of Sushil Choksi from Indus Equity Advisors. Please go-ahead.
Sushil Choksey
Congratulations to Team Central Bank for a very stable and a positive number. Sir, before I start Q&A, I know that you’ve given some guidance on the year, but can you throw some light where return-on-equity, return on assets, what kind of NIM we’ll end at advances number you’ve already indicated? And secondly, some picture on CASA because our strength is CASA. So some highlight over there, where-is our CASA coming from? Is it Tier-1, Tier-2 cities or smaller towns?
M. V. Rao
Yeah, as far as I will take the last question first. As far as CASA is concerned, you know that market is very tight and lot of competition that is there. Just because our rural and semi-urban presence network reach is almost 65%, that’s why we could able to hold-on to the 49% of CASA. It is the interior of Maharashtra, Madhya Pradesh, eastern Bihar and Eastern Uttar Pradesh and Eastern West Bengal. These five areas that are contributing to us for the CASA. Going-forward also, we think that we are going to maintain our turf in this That is on the CASA front. Regarding the ROA, whatever the guidance earlier what we had given in April 2024 is, we will be in the band of 0.75 to 0.85. Now I’m very happy to share with you we are right now at 0.87. So it is not the optimistic projection. It is with confidence, I can tell that we are going to touch 1 for the March for the ROE.
Sushil Choksey
And what about NIM and ROE?
M. V. Rao
NIM, our guidance was about 3% and we are at 3.48 that definitely we are sticking to the floor level of 3. Definitely it will be above that only. As far as the NIM is concerned.
Sushil Choksey
There is a — when I see your presentation on diversified loan book, your total retail business is almost matching corporate book. With your CASA where it is today, the customer reach which you have created in 80 million-plus customers, do we think we’ve become a consumer bank among the public sector banks with initiatives, which I’ll ask you in the next question in a stronger way than what we are targeting.
M. V. Rao
Would say, our rebalancing of the credit book, what we have done for the past three years now, it has come to a stage right now we are at 70-30, 70 is our RAM segment and 30 is corporate. And the guidance what we have given is, 65% 35% with plus or minus 5% that we are maintaining. As far as bank turning into a totally retail-oriented, definitely, as far as risk part is concerned, we will continue to be on the same platform what we have told earlier, 65 35 so that shock absorbance will be much higher than the concentrated corporate lending portfolio.
Sushil Choksey
Sir, my question pertaining to consumer Bank is more because either it is not only interest-rate, but service which may be supporting the bank’s business. It’s not that only interest-rate can attract.
M. V. Rao
Previously also I told that we are totally transforming the entire digital platform and now almost all our products are — seven products already we have rolled-out on our new digital platform and new Super app with 200 plus services already it is rolled-out to the entire staff of 33,000. And once whatever the difficiencies that is coming up that will be stabilized and it will be rolled-out to the public match-to-max within a month. That will get product app, mobile banking, which is having you know, your investments, your insurance, your deposits, fund transfers, almost 200 plus services are covered in that.
Sushil Choksey
So the Super app will become a total consumer-related app or it will be something more?
M. V. Rao
No, it is a consumer-related. And going-forward for corporate also we are going to launch.
Sushil Choksey
So what kind of investment we would have and time invested in to create this app?
M. V. Rao
Say almost 18 months,
Sushil Choksey
18 months and what kind of investment or capex we would have done to enable the bank to create a
M. V. Rao
Year I told you, our total investment on the IT is around INR800 crores total.
Sushil Choksey
We’ve spent most of it or we are still to spend.
M. V. Rao
Still, it is a five-year project life, you know, it will be spent in five years.
Sushil Choksey
So how do you see traction in-housing loans specifically, which is a bigger chunk at INR50,000 crores in our bank
M. V. Rao
So yeah, we are growing almost at 19.80%. So because our niche areas and then customer profile and then segment what we cater and the geographical area that still we are the — that is a forte for us and we continue to grow there. We don’t see much challenge because even our growth in metros are less when I compare with my portfolio growth in the Tier-2, Tier-3 cities
Sushil Choksey
Yeah, as I look at our book, we have maintained corporate credit, but at the same time balanced well with RAM and prisonal loans, personal means housing loans and other sector. How have you balanced — have you shredded more in HFC and NBFC and advanced more to manufacturing business?
M. V. Rao
No, no, I didn’t get it.
Sushil Choksey
Our advances to core economy segment has increased over HFC and NBFC because I didn’t — I might have missed the.
M. V. Rao
For NBFC, HFC, we have the caps. We are not growing beyond 10% or 11%. That is the cap what we have kept and we are sticking to that. All remaining is only retail contributed by our network, branch network.
Sushil Choksey
One question in this round, one of our subsidiaries year-on-year has dipped the Gramen Bank on profitability. Any specific reason for it?
Mukul Dandige
Salary expenses, see, the RRBs were mandated by DFS that they have to pay the computerization allowance to their employees and with retrospective debt. So 50% of it was supposed to have been paid-up to December 20 — December ’24 and remaining 50% is to be paid-up to March ’25. So that is why the performance has dipped in one of the RRBs.
Sushil Choksey
Yeah, we have in bank.
Mukul Dandige
Yes, yes.
Sushil Choksey
Okay. Second thing, sir, publicly at least already acknowledged that the insurance company, we have finalized the acquisition with the CASA at 49%, general and life insurance in our pocket, what is the vision the bank has with the insurance arm, which will become a major chunk of your subsidiary as your holding will be 26%.
M. V. Rao
See, we will be unveiling our entire aspirations and also the action plan. Once we are — we are nearing to the signing of the shareholders agreement. Once that is done, we will be unveiling the entire plan.
Sushil Choksey
Okay. Sir, any indicative deadline or timeline on that
M. V. Rao
Maybe another match-to-match one month-by February 20th or 25th.
Sushil Choksey
So congratulation and best wishes for the year to come.
M. V. Rao
Thank you. Thank you, sir. Thank you.
Operator
Thank you. Ladies and gentlemen, to ask a question please press on your phone now thank you. All participants who wish to ask a question may please press R&1. We’ll take a question from the line of Amit Mishra from Indus Equity Advisors. Please go-ahead.
Amit Mishra
Hi, good evening, sir, and congratulations on the great set of numbers. I just had one question, like our bank has done really well on all the parameters. Except for this cost-to-income, we have been not able to, I think, achieve the targeted guidance. So if you can elaborate on that, what is our guidance on cost-to-income for full-year and going further, how we are trying to achieve our guidance number, which was 50% to 52%.
Mukul Dandige
Yeah. See, one
M. V. Rao
Thing before our CFO steps in, let me tell you the major parts. One is the staff cost which is involved that is not too great to the extent it tilts the scale. It is only the other part where other operating expenses, where our investments which are going heavy investments in the IT and consequential depreciation what we are booking, that is the major factor as of now. Going-forward, because of these technology initiatives and the business which is going to be garnered through these end-to-end journeys that is going to contribute much on this. And next financial year, we expect that it should be 50 or below 50. But our guidance in this year, we have given 50% to 52%. Now we are at 58%. Let us see to what extent we will be successful to touch this. This is only the parameter where we are seeing. The only thing is how fast we can improve the incomes. That is one part that we are charking out our own program. Meanwhile, our CFO will give some inputs.
Mukul Dandige
So exactly what I wanted to say, MD has summarized it. Staff cost also there, I would like to give additional this one. What we have done is this terminal benefits, we have — we are funding it in such a way that in six years time that fund becomes self-sustainable. And thereafter the bank need not provide for anything for the terminal dues. And out-of-the Corpus fund itself, the sufficient income can be generated. That is why it appears that the terminal dues or the staff cost is a bit high. And remaining things, see, around INR4,800 crore would be the denominator in this. So for 6% to achieve at 52%, we need to improve our income by around INR384 crores. So I’m pretty sure that in the quarter to come with additional recovery in write-off accounts, my other income supporting and also the interest income on advances because our yield on advances has started now 9.01%. So with that, at least for the quarter, we should be able to come somewhere around 52% as far as cost-to-income is there.
Amit Mishra
Okay. Got it, sir. Sir, one more question on recovery side. What kind of recovery do we expect in this quarter — in current quarter, if you can give a ballpark number or any big recoveries in coming quarters like Q1 of ’26 or Q2 of ’26.
Mukul Dandige
See, as far as the recovery in write-off is concerned, this quarter we clogged around INR396 crores done with some bigger accounts which are in the pipeline under resolution and all, we expect that on a very conservative basis, if we say around INR500 crores to INR550 crores should be a number as far as the recovery in write-off is concerned. And this will take us to the cumulative recovery during the financial year well past the INR1,443 crores that we had recovered during the last year. It should top INR1,500 crores, if anything. So that is one thing. And secondly, because some of these accounts are already technically or potentially written-off. The other resolutions that are going to happen will come from — come and help us reduce the gross NPA numbers. And we expect that we — we should be well-above the last year’s recovery — cash recovery upgradation numbers.
Amit Mishra
Okay. Thank you. Thank you so much, sir, and all the best for future. Thank you.
Mukul Dandige
Okay.
Operator
Thank you. Ladies and gentlemen, to ask a question, please press RN1. The next question is from the line of Atisha Choudhary from ICICI Securities. Please go-ahead.
Aditya Choudhary
Yeah, hi, sir. Good evening and thanks for the opportunity. Sir, we — sir, we used to disclose this SMA number for all at the bank level we have given loans above INR5 crores request if you can share the SMA-0, 1 plus two for the entire bank level.
Mukul Dandige
Okay. The SMA-0 stands at INR10,097 crores, SMA-1 at INR2,565 crores and SMA-2 at INR2,610 crores. So total SMA numbers are at INR15,272 crores, which is 5.64% of the total advances.
Aditya Choudhary
Right. And sir, secondly, a few banks have started to do floating provisions in the last one or two quarters. It looks like we have not done any floating provisions, right? Is that understanding correct?
Mukul Dandige
No, no. See, last quarter also we have done a INR250 crore floating provision on the restructured assets. This quarter also, we have done a INR250 crores provision on restructured asset. Thinking that if and when the ECL, if it kicks-in, this would come handy and we would be adequately provisioned. So in the last two quarters, we have already earned INR500 crores of provision.
Aditya Choudhary
Okay. So that is the outstanding number, right? Floating provisions is around INR500 crores.
Mukul Dandige
For these done during these two quarters. And I can say that total standard provision on all my standard assets would be in the range of 1% of the AUM.
Aditya Choudhary
Okay. So sir, how do you manage to transition to ECM? Will assuming you know you have to provide on your SMA zero plus one plus 2 or at least SMA-1 plus 2 on the entire book basis. Have you ballpark — can you estimate a ballpark number which you may have to provide if the ECL were to be implemented.
Mukul Dandige
We based on the RBI’s drop circular guidelines issued on 16th January, we had done a carried out an exercise. And initially we ensured that all the NPA numbers are done. So that helped us in two-ways. One, our net NPA has come down to below 1% now. And thereafter we had a — I mean a figure of what would be the required numbers for our standard accounts. Maybe standard, maybe standard, restructured. So all put together, we have roughly around INR2,360 crores or thereabouts as the number.
Aditya Choudhary
That was the total provision needed and of which you already have some provisions, let’s say INR500 odd crores. Right okay. And this is — this is actually you have taken SMA-1 plus 2 only, right? I mean in there as per current. Yeah.
M. V. Rao
In ECL, there is no SMA concept, it will be Stage 1, Stage 2, Stage 3. So based on that, whatever are the, based on that, we have classified our advances because treasury it is already factored. It has already been carried out since 1st of April. So now these numbers, Stage 1, Stage 2, Stage 3, we are — I mean continuing to provide for in our books now.
Aditya Choudhary
Right. And so, sir, this ideally — this could continue at the pace of INR250 crores or you believe you have to take a step-up to reach that INR2,300 crores 2,360 mark or do you believe this current phase of INR250 odd crores will provide us?
Mukul Dandige
So we expect that we will be able to substantially improve upon this number also, because as it is, my credit cost has come down, so I did not provide for much as far as the NPAs are concerned.
Aditya Choudhary
Right. Okay. And sir, in Stage 2, the SME 2 ideally will become Stage 2, right in under ECL. How do you — I mean, in your view, would SMA zero or SMA-1 would also qualify for Stage 2 or SMA-1 only will qualify? And how to look at that?
M. V. Rao
Basically, it should be SMA-2, which should qualify for Stage 2 onwards. Some accounts make because if they are not frequent, then maybe they can qualify under Stage 1 and in which case if you see our SMA-0 is the highest, SMA-1 and SMA-2 are comparable, 2005, 65, 2016. So we need to see the PD, LGD and all the things and then accordingly we are taking a call.
Aditya Choudhary
Understood, understood. And sir, in the — in the SME these two, is there any let us say lumpiness in SMA-1 or 2, especially from government segment, are there any state government exposures which are there and hence ideally they should not be you know, required for LGD and et-cetera. So is this a number mostly — is there any exposure which is government and hence you need not provide there?
Mukul Dandige
No, no such exposure is there.
Aditya Choudhary
Okay. Okay, right. Secondly, sir, I think there was one circular wherein RBI said that all banks need to change the modeling of the risk-weight, right, of the risk parameters that had come in the month of August 2024, wherein they had — I mean that the circular was regulatory principle for management of models within credit I think it was a drop circular, but anything to look into that. I mean is this material, not material usual or non-usual? I mean does it have any bearing?
M. V. Rao
Yeah, as far as this draft circular is concerned, already our department is working. So as such, bank is having a well-managed risk management department where our operational risk, credit risk, the market risk and our reputational risk including IT risk, everything is evaluated and then controls and then monitoring all those things are in-place. This draft circular what it is envisaging is as an integrated framework where more focus is on the operational risk and then followed by the cyber risk. These things are also we are bringing as an integrated policy framework is that we will be working on that further because already it is there in bits and pieces that this will be an integrated one.
Aditya Choudhary
Okay. Understood. And lastly, sir, there was also. I mean, do you have — what is the gold portfolio, total gold including agri, non-agri and at the bank level because I wanted to check are we had come out with a revised final circular on gold lending. R&D had mentioned that the.
Mukul Dandige
Total gold loan portfolio of the bank is roughly around INR13,000 crores all put together. And every meeting the SSM is also having an interaction with our STAs and they also have checked the entire portfolio. We also have done –carried out the sanitization portfolio and all. So we haven’t come across any — any I mean issues that may be flat or that should be a matter of concern for us.
Aditya Choudhary
And sir, do you suspect any growth challenges in this gold loan book even for — I mean, after this other circular or this should not ideally impact your growth trajectory in this book?
Mukul Dandige
No, as it is, I mean, we are not a very big player in the gold loan market, but we do not foresee any challenges in maintaining or growing at the rate that we are.
Aditya Choudhary
Understood. Yeah. So that is very, very helpful, sir. Thanks you. Thank you so much.
Mukul Dandige
Thank you.
Operator
Thank you. We’ll take our next question from the line of Anmol Das from Arihant Capital Markets. Please go-ahead. Anmol Das
Anmol Das
Yeah. Sir, yeah. So my question is regarding the corporate credit growth. We are seeing that there is a lot of sanctions, almost 60% plus of your sanctions during the quarter was for the corporate credit and we are not seeing any growth in that. So want to understand is it become a norm that corporate credit growth will be kept low across all PSU banks in the future?
Mukul Dandige
No, nothing of that sort. See, the corporate credit as at the end of 30th September ’24 was INR70,739. So — and at that point in time, there was a degrowth of 10.61% on a Y-o-Y basis in corporate credit. During this current quarter, that is why you would be seeing sanctions at a higher amount and that has translated into actual growth into corporate credit and the corporate trade stands at INR81,476. And as MDSR has very clearly said that we have given a guidance that our RAM to corporate book would be in the range of 65% 35% with a plus or minus 5%. And for December ’24, if you see our numbers are 69.91% is the RAM and corporate credit is around 30%. So that plus or minus 5% margin cushion will be maintaining going-forward also.
Anmol Das
Understood, sir. Thank you.
Mukul Dandige
Thank you.
Operator
Thank you. Thank you. Next question is from the line of Priyesh Jain from HSBC. Please go-ahead. Y
Priyesh Jain
Es. Thank you. Sir, can you please share like how are the slippages trending for the personal loans and auto loan segment in the current quarter and the last quarter and like how are you expecting it to trend in the coming quarter and 4th-quarter?
Mukul Dandige
So the overall slippages out-of-the retail segment are at INR144 crores. For the Q3, right? If you want a breakup of personal and other thing that will provide you offline.
Priyesh Jain
Sure, sir. And look, how are you expecting it to trend in the coming quarter.
Mukul Dandige
As we have already said, personal loan and this thing, I mean we have not opened it across. So only my — only the clients who are having their salary accounts with our bank, their salary is being routed to our bank and where we do have undertaking from the employer, only those are our personal loan consumers. So that is why we do not foresee any problem as far as getting recovery in these accounts.
Priyesh Jain
Sure. And even for auto loans, sir.
Mukul Dandige
Yeah. Auto loans also, if you see our pie, we are not a very big player in the auto loans also. Total portfolio is only INR3,841 crores, which is 4.81% of the retail segment. And there also we have put in lot of checks and balances and any branch or any particular pocket, if we see any SMAs rising, then the corrective actions are taken.
Priyesh Jain
Great. Got it, sir. Those are my questions. Thank you.
Mukul Dandige
Thank you.
Operator
Thank you. Next question is from the line of Sushil Choksi from Indus Equity Advisors. Please go-ahead.
Sushil Choksey
Can I ask a question to why, sir, what is the outlook on treasury for the last quarter?
Vivek Wahi
See, last quarter, Q4, you want to ask, so my outlook will be unchanged. It — I am expecting a treasury to-end at 760 65 levels for March because we are — we are expecting a rate cut in the month of February. And of course, it will not be very aggressive because the US yields are not expected to come down at a good pace reason being the inflation. So — but still I would hope that March it will end at around 760 65 lakh. So do you see 60 65 lakh.
Sushil Choksey
So do you estimate a much more substantial trading profits based on the yield outlook in the current quarter?
Vivek Wahi
Yes, sir. Definitely. We have a decent book and a decent holding in our AFS portfolio also and we are expecting a decent gains in our treasury for this quarter.
Sushil Choksey
Sir, my next question pertains to equity. Looking at our profitability, which may end-up almost at INR4,000 crores for the current year. For next year, let’s assume we want to grow by 12% 14%, we actually don’t need to dilute the equity. I understand semi norms and government may ask us to dilute equity-based on the holding pattern today. But do we have a window that government may do OFS or we are forced to do a QIP irrespective of the condition of our balance sheet which is healthy?
Vivek Wahi
And this is the critical question you have asked. We are, you know we are very much hopeful that we may get the positive news on the YFS front. But at least as an indication to our intent to dilute the equity, we may think of for a small amount of QIP in this quarter.
Aditya Choudhary
As a shareholder or a valued thinker in future for Central Bank balance sheet, OFS would be a better opportunity because retail will garner benefits out of OFS. I wish good luck on that part. And as a shareholder, we urge that you press the government to do OFS over QIP. I understand every balance sheet needs equity for growth, but looking at the trend which you have said over quarter-on-quarter, the balance sheet seems to be on a far positive angle compared to what the numbers are visible currently.
M. V. Rao
Almost we have reached a stage it is self-generating now for our future growth that capital is self-generating within the organization.
Sushil Choksey
If you want to do something new in the bank to make self-generating and a positive, what would be one or two things which you would do now to make bank much more healthier?
M. V. Rao
We will come back-in the annual not in the last quarter.
Sushil Choksey
Okay, sir. Congratulations and best luck best of.
M. V. Rao
Thank you. Thank you.
Operator
Thank you. Next question is from the line of Ashlesh Sonjay from Kotak Securities. Please go-ahead.
Ashlesh Sonje
Hi, sir. Good afternoon. Sir, firstly, on the deposit front, the deposit growth was a bit weak this quarter at about 5% Y-o-Y and 1% Q-o-Q. Any specific reason for this? Any specific segment of depositors where the weakness is a bit more stark?
M. V. Rao
No, that’s what I have explained in my opening remarks. Total deposits, they grew by 5.34, our CASA has grown by 5.72%. And our CD ratio is 68. So if you see holistically, number-one is we are not in need of funds right at this moment the price with which it is available to fund our growth. We are self-sufficient. We have a lot of liquidity. Now coming to the point of you know, increasing the deposits, if you split the deposits into a CASA one part, term deposits one other and another segment is the certificate of deposit. If you see in the market, though that certificate of deposit is a huge market you have, which banks have issued, we are nowhere in that. Our exposure is zero as far as the certificate of deposit. Time deposit, yes, we are there only to the extent of protecting our own turf so that flight of deposits should not move. So our focus was purely on the CASA. That’s why we would be able to improve our position 20 basis-points if you compare with the previous December. So we are very conscious on that deposit front, though it appears that it has grown only 5.34, but the way we have planned and the way we are moving, that is as per our well thought-out plan.
Ashlesh Sonje
Okay. Thank you, sir. And sir, secondly, any update on the resolution of the large telecom account, the PSU account?
M. V. Rao
Yeah. We are not —
Mukul Dandige
We are not having any exposure in that.
Ashlesh Sonje
Okay, sir, perfect. And lastly, can you give a breakup of your slippages by segment, retail agri, MSME and corporates.
Mukul Dandige
See, the slippages in Q3 from agriculture were at INR127 crores. Corporate, it was INR213 crores. MSME it was INR315 crores and retail it was INR144 crores.
Ashlesh Sonje
Okay, sir. Thank you. Those are all the questions I had.
M. V. Rao
Thank you.
Operator
Thank you. Next question is from the line of Ashok Ajmera from Ascon Global. Please go-ahead.
Ashok Ajmera
Yeah. Thanks for giving the opportunity for the second time, sir. Sir, I would like to have some clarity on the tax provision and DTA net and the recent decision of the — so note number 6, 78 that Triminal special bench on 115J plus DPA and plus remaining in the old regime. So — and our provision during this quarter is INR448 crores as against INR650 crore in the last quarter. So some can the CFO or somebody can throw some light on the entire this tax thing and in effect in effect are we paying any real tax?,
Mukul Dandige
To give you the perspective, see, we had created DTA. And the DTA amount was comparatively very-high at INR7,545 crores as on 31st March ’21. So that is why you would see that this is an emphasis of matter from the auditors also, because I mean the ability of the bank to generate operating profit was the issue in this. So from INR7,545 crores, now we have been able to reduce the DTA to INR3,270 crores now,
M. V. Rao
INR3,270 crores. Yes.
Mukul Dandige
Okay. And it is out of this also, majorly it is because of the carried over business losses.
Ashok Ajmera
Okay.
Mukul Dandige
Now this is preventing us from migrating to the new tax regime also.
Ashok Ajmera
Yeah.
Mukul Dandige
So what we expect is that at the rate at which we are we are reducing the DTA, by 31st March ’26, we should be done with the business losses part completely. And from 14 ’26 onwards, we may move to the new tax regime. Again, it will be clear in next two or 3/4, but we are well-poised to cross-over to the new tax regime, which again might have a potential impact of around 12 to 13 bps in the ROA by way of reduction in taxes. This MAT issue whether the MAT is applicable to the banking, that was the issue in question. So we had challenged that MAT is not applicable to the bank and it has been that, yes, it is not actually required. So what — as part of advanced tax, I was doing my calculation based on MAT calculations and then we were remitting the advanced tax. And we were again claiming that back as well.
Ashok Ajmera
Yeah. And interest also you will get on that.
Mukul Dandige
Yes, yes, we got around INR792 crores of interest in the financial year ’21, ’22.
Ashok Ajmera
Yes. Yes. So now net-net, in fact, we are not paying any actual tax. Isn’t it just INR348 crore is only this calculation on the profit, which is against DTA right there or business losses, right.
Mukul Dandige
By March ’26,
Ashok Ajmera
Right, sir.
Mukul Dandige
It means about 15 months from now, we will make the profit of INR10,000 to INR12,000 crore, INR10,000 crore.
Ashok Ajmera
So you see, sir, this INR448 crores
Mukul Dandige
Is so that you can make INR3,274 crores totally finished off
Ashok Ajmera
This INR448 crores provision is directly it has reduced my DTA by that extent.
Mukul Dandige
Okay. Okay. All right.
M. V. Rao
So going-forward we have five quarters now. And this year — this quarter what has happened is AFS results have come down by INR200 crores. So on that 35% is around INR70 crores less tax we have had to pay. But roughly we estimate that anything between INR500 crores to INR550 crores of tax provision or indirectly DTE reduction would happen. So in next five quarters, we should be totally wiping out.
Ashok Ajmera
Good, sir. Thank you very much on that point, sir. Sir, some — sir,, sir this thing on the total recovery from the written-off account is reasonably good. What is our total written-off book now after all this recovery?
Mukul Dandige
As on-date also my total written-off book is INR34,50 crore, not INR1.34 crores.
Ashok Ajmera
So about 4% to 5% if we.
Mukul Dandige
Yes, yes.
Ashok Ajmera
From that INR1,000 crore to INR1,500 crore profit may come in next two, three years on this also.
Mukul Dandige
Three, four years, we are anticipating anywhere between 4% to 4.5%, 5% of recovery in write-off.
Ashok Ajmera
Yes. Okay, because this year this was 4.01%. So, yes, around 4% to 5% recovery. So that can be the additional profit for the — for the bank.
Mukul Dandige
Great, sir.
Ashok Ajmera
Okay, sir. Thank you very much and all the best.
Mukul Dandige
Thank you.
Operator
Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to management for closing comments. Over to you, sir.
M. V. Rao
There is nothing much to add from our side. Only it’s thank you for all-the-time and energy given by the participants. And we will assure you that whatever the guidance we have given, we will be achieving in this financial year. Thank you.
Operator
Thank you, sir. Thank you. On behalf of Antique Stock Broking, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you