INDIAN BANK (NSE: INDIANB) Q3 2025 Earnings Call dated Jan. 29, 2025
Corporate Participants:
Binod Kumar — MD and CEO
Mahesh Kumar Bajaj — Executive Director
Analysts:
Anand Dama — Moderator
Ashok Ajmera — Analyst
Piran Engineer — Analyst
Unidentified Participant
Kunal Savani — Analyst
Ashlesh — Analyst
Sushil — Analyst
Rakesh — Analyst
Presentation:
Anand Dama — Moderator
Good evening, everyone. We welcome you all to Indian Bank’s first results conference call for the 3rd-quarter of financial year 2025, hosted by Emkay Global. From the top management, we have with us Sri Binod Kumar, MD and CEO; Shri Mahesh Kumar Bajaji, Executive Director; Shiri Ashutosh Choudhary, Exei Director; Bajrang Singh, Exei Director; Anshri Bajesh — Brajesh Kumar Singh, Executive Director; and the other top management from the bank.
First, I would request the MD, sir to briefly summarize the key highlights of the 3rd-quarter results and also provide us the strategic direction on growth, margins and asset quality, post which we will open up the floor for Q&A session. Over to you, MD, sir.
Binod Kumar — MD and CEO
Thank you, Anand, and good evening to all who has participating in the con-call. Friends, Indian Bank has published its quarterly result today and key highlights are total business has grown from INR12.44 trillion to 12.61 trillion with a Y-o-Y growth of 8.33%. Deposit has grown from 6.93 to 7.02 trillion with a Y-o-Y growth of 7.34%. CASA, we have been able to maintain at 40% CASA share. CASA has grown by 3.86%.
One good thing, retail term deposit which we have been able to grow at decent 9% and advantage — advantage, we have grown from INR5.51 trillion to 5.59 trillion at 9.61% Y-o-Y, 1.4%, 45% Q-o-Q. RAM, we have grown from 3.25 trillion to 3.35 trillion with a growth of 12.79% and Q-o-Q growth of 3.08%. But particularly in retail, we have grown at 16.16%. Agriculture, we have grown at 14.04%, MSME at 8.43%. A share of RAM has grown from 63.32% on September ’24 to 64.35% on December 24 — December ’24.
If I talk of the net profit, net profit has grown from 2,119 a year-ago to 2,852 with a Y-o-Y growth of 34.57% and Q-o-Q growth of 5.36%. Operating profit has also increased from 4097% to 4749 at 15.91% Y-o-Y and 0.44% Q-o-Q. NII has increased from 5,815 to 6,415 with a Y-o-Y growth of 10.32% and Q-o-Q growth of 3.57%. NIM, we have been able to increase overall NIM, global NIM from 3.41% to 3.45% on Y-o-Y basis. That means there is 4 basis-point increase. And Q-o-Q, if I talk up from 3.39% to 3.45% on Q-o-Q basis, 6 basis-point improvement is there.
ROA — ROA, ROA, we have been able to increase from 1.33% to 1.39% and a Y-o — on Y-o-Y basis, there increase of 28 basis-points from 1.11% to 1.39%. Return-on-equity, again, we have been able to maintain at 21% with a Y-o-Y growth of 108%. Our cost-to-income ratio, cost-to-income ratio, again, we have been able to reduce it from 45.12% to 44.56%. PCR — PCR, we have been able to maintain at 98.09%, up 209 basis-points as compared to the December ’23. Credit cost, credit cost sequentially also and Y-o-Y basis also, it has come down to 0.47% from 0.65% a quarter ago.
Our earning per share, earning per share also has seen an increase of 26% Y-o-Y basis from 67.12% to 84.70 and 5.39% on Q-o-Q basis from 80.37 to 84.70. Book-value has also increased from 347.73% to 412.42 on Y-o-Y basis and sequentially from 394.412.42%. The cost of deposit, there is an increase of around 5 basis-points on COVI sequentially and yield loan advances has increased 15 basis-points sequentially. In gross NPA, gross NPA, we have been able to bring it down to 3.26%, 22 basis-points sequentially and 121 basis-points on Y-o-Y basis. Net NPA also, we have been able to reduce it to 0.21% from 0.27 a quarter ago and 0.53% a year-ago.
Slippage ratio consistently it is coming down from last 3/4 in June, it was 1.7 and September 1.06, now it is 0.78. Consistently, if you see our recovery is more than slippage, this time also against slippage of 2016, a recovery is 1,911. SMA book and many analysts may have questioned SMA has increased a little bit because two account — three big accounts has came to SME. SMA out of that now all these three has come out of SMA-2, only one is in SMA zero and presently our exposure to SMA-2 is less than INR3,000 crores. Then account bank has taken various initiatives during the last two, three year-on the account of digital initiative and HR transformation also.
In the last two, three year, we have opened more than or launched more than 170 17 journeys or two or product and processes. Similarly, account opening has also been revamped and the account opening, if I compare, it was 56 lakh during the last quarter — last financial year, which is INR42 lakh in the — in the nine months. Similarly, in current account, we have opened 1.80 lakh account in the last financial year. So-far, we have been able to open INR1.15 lakh crore.
Our guidance, whatever guidance we have given for the financial year, we stick to the guidance. Guidance deposit we are giving — we have given guidance of 8% to 10%. We will continue to do that. We will achieve that advances. We have given guidance of 11% to 13%, we will achieve that. CASA also CASA, we have given guidance of around 40%, we have been able to maintain that and we will — our endeavor will be to maintain CASA at 40%, although that may be a little challenging. See the credit deposit ratio where LDR it is at is — we have given approximately 80%. We are at 79.63%, so we have been able to maintain that. Net NPA, we have given guidance of less than 0.23%. We are at 0.21%. Recovery, we have given guidance of INR7,000 so-far we have been able to recover 5,800. So we are on-track. We will be able to achieve that.
AUC recovery, we have given guidance of 2,000, we have already recovered 2,100. NIM, we have given guidance of 3.40 to 3.50. So we are on that target. ROA, we have given guidance of approximately 1.20. We have beaten that we at 1.39. Return-on-equity, we have given guidance of 19% to 20%, we are at 21%. Cost-to-income ratio, we have given guidance of approximately 44%, we are at 44.5%, 6% and credit cost, we have given guidance of 0.77%, but we are at 0.47 so that is — these are the — these are the numbers and I will request my colleague, Mr Mahesh Bajaj to explain about the digital initiative. Thereafter we can take calls.
Mahesh Kumar Bajaj — Executive Director
Thank you, sir. Good evening, friends from the analysts and the investors. As far as our digital journey is still this — the success story continues, our digital migration has gone up from 87% to 92%, Y-o-Y 5% up. So branch-level transactions have come down to 8%. And the mobile banking and all the channels, this is a growth of 18%, same way the transaction growth is also 12%. And again, was talking about the digital journey. So this financial years, we have launched 15 — we closed 39 journeys and this quarter 15 journey. So put together 117 and our business on the digital channel have gone up by 125%. It was INR52884 crore during the last financial year December ’23. And this time it is 18,981. So it is Nine-Month growth is 125%. Same way in RAM, it has gone up by 113%. E deposits in the digital deposits also, it has gone up by 186% from 7,500 to 21,000. Same way the digital adoption also have gone up in the — both ramp MSME, it is 80%, retail, 77% and agri 88%.
And we have crossed the digital business since inception, which we started our journey is more than INR2,570 crore. And bank has the — the almost all journeys, if you see even the journey-wise also, the growth is there. We have opened 89 lakh accounts through digital platform, which is Y-o-Y, it’s 160% growth. Same way on the liability side, it is 186% growth, which is — growth is INR14,000 crore. And on the digital home loan also, also see 0.2 times growth is there, which is INR4,259 crore. You mean digital vehicle loan also, 4.7 times growth is there. And we have — I mean the drill loan — on the retail side also, we are now made journey on the digital channels, which is again a 12 time growth, which is 7,715. Digital MSME growth is also close to 79%, which is close to 4,718. And same way on the digital agri, 98%, it is almost doubled, which is — the growth itself is 33,467. Even on the self-help group also, we have started our journeys.
And our in-smart app already — it is launched on June 24 for the retail customer and it has more than 275 functionalities. It is available on both Google Pay and Apple Leb Store. We are now very shortly, we are going to start our mobile banking for the corporate customer also. It is under CUG. And on the retail, more than 60 lakh customers have already onboarded. And the digital business and fintech partnership, we have onboarded close to 138 fintechs and we provide all type of fintech solution to the government, to the institutions like principal corporation, SaaS collection, religious institution, fast, all kind of solutions bank is providing through their fintech partnership. And Bank is having various other ongoing key projects, which we have provided in the presentation. With that, I’ll conclude my presentation. Thank you.
Anand Dama — Moderator
Thank you, sir. Sir, before we open up the floor for Q&A, I had two questions. One was you said that the credit growth will be about 10% to 11%, which means that the 4th-quarter will have to do a heavy-lifting in terms of about 5% to 6% quarter-on-quarter growth. And now that you are focusing a lot on margins front, whether obviously the targets were actually given by the earlier management, would you want to stand to it or like you basically would want to revise it downwards.
Binod Kumar — MD and CEO
No, no, we won’t go for any downward revision. Credit, we are saying we will be growing at 11% to 13% in the range of 13%. And margin also we will be maintaining that between 3.40% to 3.50%.
Anand Dama — Moderator
Yeah, but then that would call for a pretty heavy growth in the 4th-quarter given the run-rate actually
Binod Kumar — MD and CEO
But you see credit, we have all grown at almost 10% already. So maybe we are — and you see, in 4th-quarter demand is also higher. So that is achievable, we will achieve that.
Anand Dama — Moderator
And my second question was to Mr that — I mean we have given a good slide on digital lending front. So is it all organic digital lending that we’re doing or basically there are a lot of partners who basically we are doing this thing?
Mahesh Kumar Bajaj — Executive Director
No, basically — sorry, basically, our journey is we have already taken a vendor. So with that — with their help, we are doing all these journeys. As far as the other solutions which we are providing where we did not go for our own solutions, there we have onboarded 138 fintech partners like some government department is asking for a platform solution, some institution is asking. So for that only these platforms are the fintechs we have onboarded. Other than that, bank has its own we are — journeys we are only doing and through our own — the permanent partners only. Vendors we have already onboarded for mobile banking as well as the DLP digital lending grid.
Anand Dama — Moderator
Recall we had a rupik as one of the partners which was there, particularly on the for debt. So is it still working that partnership is still working or like we have basically closed out that partnership?
Mahesh Kumar Bajaj — Executive Director
No, that was basically for doing business on the gold loan, but bank on its own is having good amount of business. So with rupee, we have stopped doing. I think very a few lakh odd crore must be depending. How much is balance? No outstanding as on-date and we are not taking it forward. Co-lending, we used to co-lending, we are going to stop.
Questions and Answers:
Anand Dama
Now we’ll open up the floor for Q&A. Anybody who wishes to ask a question shall raise their hands. I request all the participant to limit their question to two per participants in the first round. If you have any further questions, please come back-in the queue. First we have Mr Ashok in the queue. Sir, please unmute yourself and ask the question.
Ashok Ajmera
Yes, sir, good evening. Binod Kumarji, and welcome to you to Indian Bank as the Chairman Managing Director and CEO. Nice to see you there.
Binod Kumar
Thank you. Thank you. Good evening. Sir
Ashok Ajmera
Yes, good evening. My first question is, I will extend Anand’s concerns because my major concerns is basically on the growth nowadays in most of the banks are facing. But it seems that our growth in like last nine months, of course, you have joined — I mean the bank recently, but of course, I’m talking about the whole bank as such has been very, very mute. So if you maintain the same targets of 11% to 13%, say even 12% of the credit growth, you need to disburse in this quarter almost about INR38,500 crores. As against INR8,500 crore in the last quarter and INR25,000 crore in whole of nine months. So how do you — like how do either we believe that INR38,500 crore can be disbursed by Indian Bank only from January to March 2025. So some color on your sanctioned pipeline, you have your disbursements you know under pipeline, because even if some fresh sanctions take place now. I think the loan book will not increase. The disbursement will not take place before 31st March. It may not take as
Binod Kumar
I appreciate your concern because since last quarter we have grown by INR8,500 crores and all of a sudden if management come and say that we will grow by 38,000 or so I appreciate your concern. But if you see, in last quarter, the growth has been good in the RAM sector. RAM, we have grown at 13%. So that means there is no challenge on the RAM. So then question comes of the corporate. Corporate, we have a good pipeline — pipeline of around INR40,000 crore in various stages. Some are in the disbursement stage, some were in-principle has been given, some proposal has come to head office, some of the — and last — after joining my joining, we have also conducted — already conducted one MC. So — and we have — we have already after — as you were saying, after taking charge, I have already taken a stock of the situation, and you are saying 38,000, I’m targeting rather 40,000 and we will be able to achieve the 11% to 13%. Not saying 38,000. I said I took the average of 12%, that is why 38,000. But 40,000
Ashok Ajmera
Yeah, better. And we will be very happy, sir. We will be very happy if you achieve this target because on the deposit front also, we are lagging to have. And yeah, there are
Binod Kumar
But deposit deposit also, let me tell you the good thing. Good thing if you see our — that data may not be there. Our deposit growth, we could have grown. There is no issue in that. But total wholesale deposit, we have degrown from 1.08 to 1.01. So there is no point in taking deposit at higher-cost and deploying somewhere at not very profitable opportunities.
Similarly, if I talk of the retail deposits, retail deposit, we have good growth of around 8% to 8% to 9%. Okay. So — and CASA, we have been able to maintain 40%. So if we want to grow, it’s our choice. If you would have wanted to grow at, let’s say, 9% or 10% in CASA, if that make business sense, we could have grown because you could have taken some bulk deposit because CASA and retail term deposit is supporting us.
Ashok Ajmera
No, sir, it’s very good to be to be optimistic and then to achieve also the same optimism targets. Sir, my second little bit observation, you said that in — because the SMA-2 numbers had increased to INR4,982 crore and you said that three accounts have already been, I mean, recovered the amount they are regular from SMA-2 to SME 0 maybe or SMA-1. And now the balance outstream is only INR3,000 in SMA-2 as on today. So these two or three accounts are a habitual of one month lag, I mean, coming in SMA-2 and again going-in SMA-1 or it was a one-time problem for them.
Binod Kumar
See, these accounts are coming in SMA for some time, let’s say three, four months. But out of these three, two has come — become regular completely not even in SMA-0. Only one account is in SMA-0, which we expect that will also come — become completely regular. And going-forward, it is our expectation that this should not further slip to SMA.
Ashok Ajmera
Okay, sir. That’s a very good point. Sir, on the — there is one note that INR155 crore excess provision has come to the profit and loss account because of the — on the sale of the stressed loan book. So going-forward in this quarter also, we expect some some this kind of additional recoveries, like or the reduction in the provision because of those recoveries, sale of stress loans.
Binod Kumar
A sale of stress loan, so I will reply it like this, Rajee. So recovery in — which is adding to our bottom-line and operating profit also, that amount is around INR548 crore. Last quarter it was somewhere INR782 crore. So we expect that this INR540 around INR500, we will be able to achieve that because we have given guidance of recovery of around INR2,000 in AUC and we have already achieved 2,100 and whereas it was last year INR3,000 crore. We expect that this momentum will continue because we have good TWO book of around INR40,000 crores.
Ashok Ajmera
Sir, my last question in this round, sir, is on investment book. Investment or rather now is — we’ll Call-IT as a trading profit or opportunities either, I don’t know on the arbitrage or something. So how do we — can the treasury like looking — I mean income from in this coming quarter profit from the investment, sale of investment or the treasury profit. Some indication in this coming quarter — I mean January-March quarter.
Binod Kumar
Treasury profit, yes, we are expecting in this quarter treasury profit was INR278. No. It was 283. So trading profit was INR283, but MTM was minus INR20 — there was MTM charge of INR24. So maybe next quarter, we will have some trading profit again, it should be in the same range. And MTM may not be there because we expect that there should be some moderation in the interest-rate. So maybe not be there. This is my expectation, but don’t know market how it will behave.
Ashok Ajmera
Yes, sir. No, anyway, sir, good. Once again, congratulations and all the best to you. You are maintaining a very good ROA of 1.39, your net NPA is also almost now — no more scope is there for any further provision 0.21. Of course, in gross NPA, still there is scope for reduction. So anyway, all the best to you, sir. And if time permits, I’ll come back again, sir, for some minor database data points, sir. Thank you.
Binod Kumar
Thank you, Raji.
Anand Dama
Question we take from Piran from CLSA. Piranj is.
Piran Engineer
Yeah. Thank you. And congratulations, Binoji, for this new role as MD and CEO. Sir, firstly, I just wanted to ask what is our LCR right now, liquidity coverage ratio?
Binod Kumar
Thank you, Piran. My — my LCR as on 31st December was 116 and presently it is 125.
Piran Engineer
Okay. And what are our plans to — after the LCR norms come, is 116 the comfortable level for us or do we plan to shore it up?
Binod Kumar
But on an average, our LCR remains in the range of — in excess of 120, approximately 125. And impact of new norms are around 8 to 10 basis-points. So on particular day, I cannot say, but we — with 125, even if there is a hit of 10 basis-points, then 115 we will be able to maintain. I think that is comfortable.
Piran Engineer
Okay. Okay, sir. And sir, secondly, just going back on our — the SMA book, can you give us some color these three accounts, which sector were they from? Are they PSUs or private? And what gives you confidence that the SMA zero account will be recovered soon? Just some color would be useful, sir.
Binod Kumar
See, if you see the track-record of all these accounts, these accounts recovery has been very good and it’s not new account. It’s whole — all these are whole account, hold account. So all of a sudden, some problem and since last, I will say around six months, there has been some issue. But now some understanding has been reached and we expect that these accounts would not slip into SMA further. Two has already come out of SMA and one which is in SMA zero is expected to come out shortly.
Piran Engineer
Okay, sir. And sir, just lastly, in agri, for other banks, we see in the 3rd-quarter slippages are usually higher. You know, like ICICI Bank, Access Bank, they say slippages pick-up in 3rd-quarter. But for us, it has actually gone down. Is it a different profile we do because we don’t do much Kissan credit cards? What would be the reason really?
Binod Kumar
Yeah. We actually we are focusing on investment credit. So that is a differential.
Piran Engineer
And KCC is not much for us.
Binod Kumar
KCC we are doing, but selectively.
Piran Engineer
Okay. Okay, sir, this answers my question. Thank you and wish you all the best-in your new role.
Binod Kumar
Thank you thank you.
Anand Dama
Question we take from Rakesh or Rakesh please
Unidentified Participant
Hi sir thanks. Thanks for the opportunity and quite good set of numbers. So just had few queries, sir. So firstly, coming to this standard-of-site provision, we are — we are continuously making this provision. And if I’m not mistaken, that number like we have done it like-kind of around INR550 crore we have done for the nine months, and we already had close to around like INR8,000 odd crore in the March ’24. So what is the provision that we have for the restructured book and for the SMA? So like if you can just tell us, so what is the provision cover we have on that now
Binod Kumar
On SMA-2 book, we make provision of 10% flat on SMA-2. And on restructured book, we have a provision of 25%.
Unidentified Participant
Okay. So does this mean that the additional provision that we have, so if I consider that for the standard loans, which are not, you know, we would have approximately 55 bps of provision, 50 bps 55 bps of provision. And then we have, as you said, 20% provision for restructured and 10% for SMA. So the residual standard asset provision, is it that we are building it for ECL only.
Binod Kumar
I will not say that it’s building for ECL because we don’t know when ECL will come. We are adopting prudent measure, I will say. Wherever we feel that there is some stress or account may sleepage, sleep or there may be some sector where we can see some stress, we are conservatively making provision, prudently making provision for that.
Unidentified Participant
Okay. Sir, just second question on the borrowing part, sir. We have raised infrastructure bond of INR5,000 crore at 7.1% to percent. Our borrowing cost seems to have gone up. So I know this is very small amount as compared to the borrowings total outstanding, but if you can let us know why the borrowing cost has gone up this quarter?
Binod Kumar
Rakesh — Rakesh, not INR5,000. We have raised infrastructure bond of INR10,000 crore. And whatever amount you see, it is because of that only.
Unidentified Participant
No, INR5,000 crore, I think you raised in October ’24 as you are mentioning in the previous year.
Binod Kumar
This financial year previous quarter 5,000. Two quarters. So it is impact of that only because I have analyzed that and that is what exactly. See, Rakesh, what had happened we have raised money in Q3, but — sorry, Q2, but impact of that has come in this quarter.
Unidentified Participant
Got it. Got it. Okay, sure, sir, sir. That answers my question. Thanks a lot, sir, and all the best
Anand Dama
Maruf, unmute yourself and ask your
Unidentified Participant
Heah, hello. Hello, sir, congratulations. Congratulations on your new role. Thank you. So I had a couple of questions. Firstly, the deposit-taking was tough for all banks in the 3rd-quarter. So has it changed on the margin in the 4th-quarter or do you see change in the 4th-quarter? And therefore, will some of the rate or do you see any deposit rate cuts even if the repo rate is not cut in the near-future? That’s my first question. And my second question again is on loan growth that we see Bank of India also said they are going to grow 14% to 15%, then Union Bank also gave a loan growth guidance. They have basically retained their guidance. And so for all PSU — I mean for at least these three PSU banks, the implied growth for the 4th-quarter is 5% to 6%. So it’s not only for your bank, it’s for everyone. So is there enough demand or enough corporate demand for everyone to grow 5% to 6%? Is there some capex lined-up or is this busy season or real busy season? So I just trying to find out whether there is indeed some demand improvement from the corporate side?
Binod Kumar
Thank you, Maru. Deposit rate cut, I don’t think there will be a rate cut on the deposit front. Because if you see the bulk rate, it is already very-high and I think it will continue to unless there is some rate cut is there. And on the credit growth, as I earlier told also,, RAM sector, we are already growing at 13%. So at 64% of our book are RAM. So then we have to concentrate on the — if we are able to do some good corporate credit, we will be able to grow at 11% to 13%, which guidance we have given. And for the — for that, we have pipeline of INR40,000, around INR40,000 crore in the corporate book itself and overall pipeline of around INR60,000 crores. So we are hopeful — we are quite hopeful that we will be able to add around INR38,000 to 40,000 during the Q4. And over — if you see otherwise also if you see historically also credit growth in Q4 is higher as compared to other quarters.
Unidentified Participant
Got it, sir. Sir, and with higher corporate growth, would that put pressure on margins or not really?
Binod Kumar
No, no margin will be very cautious. As a philosophy, we are — giving loan on the reported loan or external benchmark linked loan, corporate book particularly. We will be cautious of the margin also. But if there is some rate cut or I mean deposit cost really goes up, then there can be some moderation, but we will see we are at 3.45%. So NIM and we have given guidance between 3.40% to 3.50. So we will be able to maintain that margin.
Unidentified Participant
Okay. Got it, sir. And my final question is on LCR. So no final guidelines have come. Would that mean that it’s I mean, we can forget about it now or how does it work?
Binod Kumar
No, no, we cannot forget about it. It’s already there and we are — we are having calculation on regular basis of that. And we expect that at some point of time, it will come, timing we cannot say.
Unidentified Participant
Got it, sir. Okay, sir. Thank you so much. Thanks a lot. All the best. Thank you, sir. Thank you.
Anand Dama
Thank you. Next question we take from Kunal Supani from please unmute yourself.
Kunal Savani
Hi, sir. Just a basic bookkeeping question. I just wanted to know-how do we calculate this book-value, which is at 412 and if we calculate it based on the balance sheet cap — equity, which comes at INR495. So what exactly is adjustment we do in the book-value per share
Binod Kumar
CFO is replying
Mahesh Kumar Bajaj
So that is our net divided by the number of shares of net-worth divided by number of shares.
Kunal Savani
Sure, thanks.
Ashok Ajmera
[Indecipherable]
Unidentified Participant
Hello, sir, good evening and congratulations congratulations, sir, on your new responsibilities. I have few questions, sir. First, on — yeah, sir, on your MCLR rates, right? So if you look, there have been inching up of cost of deposits in the last six, nine months, but the one year MCLR rates have not increased commensurately, right? It’s only 5 maybe 5, 5 basis-point increase. So how does this work? I understand other banks have also not raised too much NCLR rates. But what is your sense as to why MCLR the rate increase is much lower than the rise in the cost of deposits?
Mahesh Kumar Bajaj
So MCLR thank you, Jeff, for a good visage. MCLRC, MCLR is a marginal cost. So marginal cost and it is a defined formula from RBI. So we are calculating according to that — that because we have to take cost of fund, then operating costs and very much defined formula. So I don’t think there should be — and if you see particularly cost of fund of the banks has gone up by definitely if I talk of the my bank cost of just a minute, cost of — don’t have that number right now. That is Q-o-Q basis. Q-o-Q basis, it has gone up by-5 basis-points. And if you see my MCLR has also gone up by-5 basis-points in the last month. So maybe not we commensurate because whatever we’ve reply to that also is to see 40% is CASA. So entire cost is not being built-up in the — while calculating MCLR.
Unidentified Participant
Right. Okay. Sure, sure, sir. And secondly, sir, if — and if you can bifurcate the loan book into MCLR and EBLR and T-bills and maybe fixed-rate book if you have that breakup study.
Mahesh Kumar Bajaj
MCLR linked, it is 56.68%, EVLR it is 36.97% and fish it is 4.74%.
Unidentified Participant
Okay. Sure. And sir, where do you put the gold loan, which we have, I think a decent amount gold loan. Is that also a part of — out of this or this is included in floating or how does it work?
Binod Kumar
It is mixed, part of that. Part of that in agri MCLR and part of that in EVLR.
Unidentified Participant
Okay, sure. Hello. Yeah. Yes, sir. Sir, on this gold loan, if you can also quantify how much is the total gold loan at the bank level, how much is agri gold and how much is retail gold?
Binod Kumar
Total gold, we have 90,000, out of agri is 78. Total gold loan is 90,000, auto of agri is 78
Unidentified Participant
Right. And sir, any changes because of this RBI new final circular on gold loan, are you — do you have to make changes to any of the gold loan product on agri and non-agri side?
Binod Kumar
So yes, because of that, there has been some declassification from agriculture to non-agriculture and that impact has already been taken.
Unidentified Participant
Okay. Sure. And then sir, I also wanted to check on standard assets provisioning. So you mentioned that the bank provides a 10% straight away to SMA-2. Is there any other broad guidelines? So we have INR500 crores of standard assets provisioning this quarter. If I just look at SMA-1, 2, I don’t think at the — I mean one maybe that explains the SMA-2, but is there any other formula or broad framework to provide for the standard assets provisioning?
Binod Kumar
Yeah. So Jay, I told wherever we see a stress somewhere building up, we make provision in that segment, sector or account. So some additional provision has been made in some of the sectors and some of the accounts.
Unidentified Participant
Right. And sir, if you have the number as to what is the outstanding non-NPA provisions at the bank level that may include restructuring provisions you have already given is there in the presentation. But what is the total stock of all general and non-NPA provisions, if you have that number.
Binod Kumar
So basically you want to have ECL numbers. We are presently I don’t have that number. I will share with you separately.
Unidentified Participant
Sure, sir. And lastly, sir, I think you mentioned or you hinted that you are doing very well in RAM, right? So no doubt about that, 13% 14% is a very decent growth. But corporate growth has been coming down only, right? I mean it has now come down to 4%, 5% Y-o-Y. What is going to change, sir, in this quarter? I mean, see, we were growing at 10%, 11%, then we came down to 8%, 9% and now last quarter corporate growth is around 5% only. What could change for you to — and just to grow this book without impacting margins too much? I was just thinking on those things.
Binod Kumar
For corporate also otherwise we are also growing at 8% to 9% so you can take last quarter as an average.
Unidentified Participant
Okay. Okay. Sure. Thank you so much, sir and all the very best.
Anand Dama
Thank you. So next question we’ll take from Ashlesh. Ashlesh, please unmute yourself.
Ashlesh
Hi, sir. Good evening and congratulations on the new role. First set of questions is on the deposits front. If I heard you correctly, your guidance is 8% to 10% growth in FY ’25 on deposits. If I look at your YTD growth in the first-nine months, that is at about 1%. So do you expect — so how do you — how do you plan to achieve that 8% to 10% guidance in the next quarter because that would imply a fairly sharp jump-in your deposit acquisition.
Binod Kumar
Yeah. But if you see our Y-o-Y growth in deposit was 7.34% and I as I told you, our growth in retail — retail term deposit is also at around 8% to 9%. So we are quite hopeful and accretion that means accretion in the last year also, it would have been good accretion in the Q4 because if we are growing at 7.74% — 7.3% in the Y-o-Y basis, that means whatever accretion we have been able to make last year, we will also be able to make accretion in this quarter.
Ashlesh
Got it. So you do not include that 10% we will achieved. Sorry?
Binod Kumar
Yeah. Please go-ahead, go-ahead.
Ashlesh
So you said more than 10% you will achieve?
Binod Kumar
Deposit. 8% to 10%.
Ashlesh
Okay. Sir, no you won’t include the — you don’t include the infrastructure bonds in the — in that guidance, right?
Binod Kumar
Yeah. No, no, no. Infrastructure bond is.
Ashlesh
And secondly, does not — you indicated that you have shared some of your bulk deposits. If bulk term deposits, if I heard you heard the numbers right, you said it’s gone down from some 1.08 trillion to 1.01 trillion in this quarter. Any specific reason why this shedding has been undertaken in this particular quarter itself. Why not earlier?
Binod Kumar
And not any specific reason because maybe not getting at the our desired rate, whatever we are looking for, not any specific reason otherwise or not opportunity to invest it at a desired rate.
Ashlesh
Got it, sir. And sir, I understand
Binod Kumar
And for the management of the fund, we have been able to range — raise INR10,000 crore of infrastructure bond. So that is — that is also a money fund for me. So if I can — since we have raised also INR10,000 crores, so because of that also we went a little slow on the bulk side.
Ashlesh
Okay. Got it, sir. Sir, and just lastly on the AUC recovery, that momentum has been extremely strong for us in this nine months. Any sense you have for the recovery outlook for the next year, whether this can be along similar lines or down, let’s say, 20% or down 40% from FY ’25?
Binod Kumar
And AUC recoveries since last year it was INR3,000. This year we have given guidance of INR2,000 crore. Let final number come in the March, then we will give guidance for the next year.
Ashlesh
Okay, sir, perfect. Thanks a lot for your responses.
Anand Dama
Thank you. Next question we take from Sushil.
Sushil
Congratulations on your and congratulation to team Indian Bank for a great set of result. Sir, everybody is asking a question on growth path. I have a little different question. Textile industry in Southern India post Bangladesh is witnessing some positivity. And you’ve been headquartered in Tamil Nadu in nine. The cluster of textile is large. Auto ancillary is very large performing sector for India and they are again based in South. Are we seeing accelerated traction specifically in these two sectors from our RAM or large corporate in the credit which we are sanctioning or likely to sanction.
Binod Kumar
I mean we have not seen as we are seeing any good demand of improvement, but we expect that going-forward there should be some demand from the textile sector because if you see the textile sector is just struggling since last two years. And gradually things are improving, so textile sector may see some good demand in coming quarter or coming — going ahead.
Sushil
So unavailed credit is — I mean the credit pipeline, which is already sanctioned, the availment is not fully utilized, you mean in these two — these two segments of the bank or you would say they are quite utilized well?
Binod Kumar
No, non-utilized portion are there, right?
Sushil
So what would be unutilized credit in the bank today, if I ask from a credit growth perspective
Binod Kumar
Unutilized limits. 17 9 to 8. So we have sanctioned limit of unutilized limit of INR17,928 crore, unaveheld portion.
Sushil
Sir, any visibility on infrastructure which you know Apple cluster, large data centers, many other warehousing and multiple large projects, whether led by PE or large conglomerates are coming, Tamil Nadu, Karnataka and Southern Belt in proportion to — in similar proportion to Western zone and the visibility is very-high on those projects. Is any credible visibility at your end, these companies are talking to you are likely to emerge in this quarter or the next quarter
Binod Kumar
Not any specific sector-wise I cannot give you, but we have a good pipeline whereas wherein we have given say sanction of in partially disbursed book is INR10,851 crores where we see there will be disbursement. And then we have sanction of INR8,000 crore where we have sanctioned, but disbursement is yet to start. And there are some cases still we are some negotiation is going on, that is around INR5,000 crores. We have given sanction, but some amendment in terms and conditions may be required. So these are the thing.
Sushil
So our management team have taken a lot of initiative where digital spend is concerned, state government businesses are concerned, not only within state of Chennai, but in various geographies like boards, principalities, collection, which would attract CASA and many other things. And lot of digital spend was initiated in last two years. Any further improvement outlook coming from these businesses or the digital spend, which Mr Bajaj may answer if possible.
Mahesh Kumar Bajaj
Yeah, yeah. See, again, our the last few quarters, our digital spend on the — if we talk about the NINS, it is close to 35% and opex, it is 9% to 10%. And in even the further committed figures are also close to 9% to 10% of our OpEx. It will remain. And same way on the capital also capital expenditure on the IT will remain in the next two to three years, already we have committed for so many projects. And on the government fintech partnership already, we have done good amount of the tie-ups or close to 100 projects completed and 65 to 70 projects are already in pipeline. So those — for those also, we have already the line of fintech partnerships and those projects also will keep going.
Sushil
So this Fintech partnership can contribute how much to our growth in terms of retail or MSME loans?
Mahesh Kumar Bajaj
No, it is not basically this fintech partnership basically it is for government department basically it gives us the collection. So there, this government and fintech department, when we started almost three years back, we have got close to INR15,000 crore to INR20,000 crores of the present balance in those accounts.
Anand Dama
Okay. So these are more from the other account you had to call-back in the queue.
Sushil
Okay. Thank you, Anand. Thank you, sir.
Ashlesh
The next question we’ll take from Ashlesh. Please limit your questions to you. Okay, sorry, I’m done. No more questions from my side. Thanks.
Anand Dama
Next question we take from Rakesh, Rakesh?
Rakesh
Yeah, hi, sir. Thanks for the opportunity again. Just one small question, sir. So we have a total PSL you know, approximately INR1.5 trillion. So what is the refinanceable borrowing that we can get against that because that would greatly save the borrowing cost as well as it will help on the LDR front also. So if you can help us understand that.
Binod Kumar
As so refinance level, PSL you are talking of?
Rakesh
Yes, sir. Out of 1.9 trillion numbers which is the completely in-house generated book of PSL.
Binod Kumar
We have already taken. From CDB, we have already taken. No, no. So refinance out of that see — I will reply it like this INR1.9 trillion is the book. So part of that will be refinanced, part of that will be repaid, but our growth will continue. So PSL, whatever earning we are having through PSL, we — we will continue to have that income through the PSL in the coming quarter also.
Rakesh
No, sorry, I was referring to something else. So PSL income is coming and that is doing quite good to our fee income yes. But what I was referring is that in the borrowing number, sir, so for the refinance borrowing, how much more that we can get and what would be the upper limit of that refinance we can avail against the last pair of borrowing okay.
Binod Kumar
We will give — we will give you Rakesh separately.
Rakesh
Sure, sir, sure, sir. Thank you, sir. Thank you so much, sir. Thank you.
Anand Dama
Next question we take from. Please unmute yourself.
Unidentified Participant
Yeah. One is just one clarification. You mentioned that SMA number has come down to below INR3,000 crores. So you are talking about SME 2 only, right?
Binod Kumar
All SME. So all SMA, all SMA I was talking.
Unidentified Participant
Okay. So this INR7,700 crore has come down below INR3,000 crores.
Binod Kumar
Yeah, yes. INR2,500 crores. It has come down to INR2,543 crore only which was INR76, 77 altogether RAM and plus corporate.
Unidentified Participant
Okay. Okay. And my second question was any particular reason for not continuing the co-lending business?
Binod Kumar
Co-lending we are waiting for — we are in the process of having some complete end-to-end co-lending solution. Till that time, because subsequently there are many issues crop up regarding towards reconciliation. So because of that, we are waiting till we have a complete solution, end-to-end solution for the co-lending, only then we will go for co-lending.
Unidentified Participant
Okay. And how much would be our MFI book?
Binod Kumar
MFIN 1,244 only
Unidentified Participant
And how it is being?
Binod Kumar
There is no. No SMA in that.
Unidentified Participant
Okay, okay. That’s it from my side. Thanks. Yeah, thank you.
Anand Dama
Thank you,. Actually your you want to ask question.
Unidentified Participant
Sir, your outlook on your international book and treasury seeing that yields which are there, are we being conservative in our guidance
Binod Kumar
Great. You see overseas book is growing at decent 7% to 10%, we will continue that growth rate Y-o-Y or also on Q-o-Q also. On treasury book, yes, we see — we will see some moderation in the yield. So basically some income should come from there. Guidance exact number may not be — I mean, I may not be in a position to give you the exact number, but we expect some good income from the treasury in Q4.
Unidentified Participant
Sir, previously, Mr did answer my digital tie-ups and expanded the question, but do we have some kind of a budget which we have planned over a period of two years after you have joined the bank that we would like to spend on digital — digitization and digital expenditure of the bank, which is like a capex.
Binod Kumar
Presently, bank is spending around 1,200 in on the digital front. And we will continue wherever one thing I can assume the exact amount that will depend on the requirement also what strategy we adopt going-forward. But this type of spending will keep on happening for, say, another two, three year at least because there are many projects in the pipeline. Many initiative has already been taken. So we will mature that.
Unidentified Participant
So we had created a subsidiary for a lot of back-end work to be done and I think RBI granted approval and many banks like SBI, Bank of have been effective in doing a lot of Kissan related products or cross-selling or back-end processing where retailers concerned. Where do we stand today and how is the shape taking up place where Indian Bank is concerned on that?
Binod Kumar
So IG, IG SSL has been — I mean, it has been only recently established. And in this quarter, we have been able to garner business of INR1,765 crore in this year itself. And we have a good plan for that — for that because, see, we want that to be our marketing arm. So we will focus on retail product also. We will focus on housing loan, we will focus on vehicle loan and collection also. We will use them for collection also. So going-forward, we have lot of expectation from and lot of plans from this subsidiary.
Anand Dama
In the interest of time, we will take that as a last question. Sorry, if you have any closing remarks to make before we end the call.
Binod Kumar
The bank is doing good numbers you have already seen. We will maintain the same philosophy of HTD growth and good asset quality and efficiency parameters like return on asset or provision coverage ratio. So these things will continue and we will focus on MSME also and if you see the last two years as Mr Bajaj told you, we have made lot of investment on digital front. But the benefit of that is yet to come. So digital adoption in a RAM sector, it is good. But on liability product also, digital adoption, we will lag to increase. And we are also coming out with the next-gen call-center, we will be going for CRM solution. We are also in the process of procuring imply assist wherein if have some query, he can simply put his query and he can get the reply. So that will help the knowledge gap of the imply. So these are the few initiatives we’ll be taking and MSME will also be our focus area. Thank you, Anand.
Anand Dama
Thank you everyone. Yeah, thanks, everyone. And with that, we will end the call. Have a good day.