Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Jammu & Kashmir Bank Limited (NSE: J&KBANK) Q3 2026 Earnings Call dated Jan. 20, 2026
Corporate Participants:
Amitava Chatterjee — Managing Director and Chief Executive Officer
Ketan Kumar Joshi — Chief Financial Officer
Analysts:
Sukrit D. Patil — Analyst
Deepak Podar — Analyst
Gaurav Agarwal — Analyst
Mona Kathan — Analyst
Sonaal Singh Kohli — Analyst
Saket Kapoor — Analyst
Presentation:
Operator
Ladies and gentlemen, good evening and welcome to the Q3FY 2026 conference call of Jammu and Kashmir Bank Limited. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call please signal an operator by pressing10.0 on your Touchstone phone. Please note that this conference is being recorded. We have with us today from the bank Mr. Amitav Chatterjee, Managing Director and Chief Executive Officer along with his management team.
I now hand the conference over to Mr. Chatterjee for his opening remarks. Thank you. And over to you, sir.
Amitava Chatterjee — Managing Director and Chief Executive Officer
Thank you, Supnali. Good evening and a warm welcome to all the investors, analysts, other stakeholders joining us today for the JNK Bank December 2025 earnings call. Before starting, on behalf of JNK Bank, I wish you all a very happy and prosperous New Year. Let me introduce my fellow colleagues from the Bank’s senior management who are accompanying me on this call. Executive Director, Mr. Sudhir Gupta. Chief General Managers, Mr. Sunit Kumar and Mr. Imtiaz Amad Bhatt. Retail Banking Head, Mr. Rakesh Maghotra.
Corporate Banking Head Mr. Nishikanth Sharma. Impaired Assets Portfolio Management Head, Mr. Rajesh Mala Tikku. Chief Financial Officer Mr. Ketan Kumar Joshi. Chief Risk Officer Mr. Alta Hussain Kira. And our Treasury Head Mr. Ajay Kohli. The Indian economy has continued to show. Strong momentum with real GDP registering a six quarter high growth of 8.2% in quarter two of FY2526, underpinned by resilient domestic demand. Amidst global trade and policy uncertainties. The domestic demand has been buoyed by strong private consumption during the festive season and tax rationalization measures.
As for the projections of RBI and World Bank, India’s economy is projected to remain among the world’s fastest growing major economies with estimated growth of 7.2 to 7.3% in FY25 26. India’s role as a key engine of growth among global markets has been acknowledged by the World bank in its latest Global Economic Prospects Report crediting India’s resilience in helping offset the impact of heightened global trade frictions and lifting the overall growth in South Asia. In the backdrop of this improved domestic macroeconomic environment, the bank has also recorded a healthy growth in business during quarter three with the highlight being a credit growth outpacing the system complemented by a steady and consistent improvement in asset quality.
Our deposits have grown by 2.5% sequentially with a double digit YoY growth of 10.6%. Growth in advances has been recorded at 7.7% QoQ and 17.3% YoY, substantially higher than the growth of 14.5% in bank credit from 27.12.24 to 31.12.25 as per the Scheduled Bank’s Statement of position published by RBI which is estimated at 11.7 to 12% excluding the extended reporting period. While the bank has witnessed a YOY. Growth across all categories of deposits, demand saving and term, the accretion of CASA deposits has been much slower than the term deposits.
This is in line with the broad industry trend driven by shift towards high yielding term deposits along with increased deployment of funds into alternate investments which is evident from the share of bank deposits in household financial assets falling from 40.9% in FY 2021 to 35.2% in FY 2025 while mutual funds have ballooned from being just 2.1% of household savings to 13.1% over the same period. Consequently, the bank has witnessed a decline in cash air ratio being recorded at 44.10% as on 31st of December 2025.
However, it is still much higher than the industry average of 37.4% for quarter two FY 2026 with our CASA in Jammu and Kashmir accounting for 86.3% of our total deposits being even better at 48.51%. Speaking of advances, now with an above 17% YoY growth, the bank is comfortably poised to achieve the guidance of 12% credit growth for the fiscal. The growth during the current financial year has been balanced both in terms of the contribution from geographies of Jammu and Kashmir, Ladakh and rest of India as well as in terms of retail and corporate contribution.
Jammu Kashmir, Ladakh and rest of India have contributed 56.7% and 43.3% respectively of the incremental YTD advanced growth with retail corporate contribution being 53.4% and 46.6% respectively. On a sectoral basis, a double digit YTD growth has been recorded in agriculture and corporate loans which together account for more than 40% of the bank’s loan portfolio with agriculture growing at 25.7% and corporate loan book by 14.7%. Retail advances constituting around 65% of our advances have also registered an almost double digit YoY growth of 9.4%.
Within the retail book, car loans and housing loans have registered a YoY growth of 15.3% and 8.9%. In order to capitalize on the opportunity presented by reduced car prices on account of tax escalation measures along with the year end discounts, bank launched a campaign of auto loans which ran during the entire quarter and was highly successful. With our car loans growing by 10.7% q on q and both Jammu Kashmir, Ladakh and Rest of India recording a. Double digit growth, our personal loan segment.
In Rest of India continues to grow at a healthy rate recording a 14.4% growth with car, housing and education loans all recording double digit growths. Profitability for the quarter has also improved considerably with net Profit increasing by 18.7% Q on Q and recorded at Rupees 587 crores. Notwithstanding the industry wide pressure on margins witnessed following RBI’s cumulative rate cuts of 125 bips during calendar year 2025 combined with our bank having taken an unforeseen hit of rupees 180 crores on account of impairment provision arising from the amalgamation of RRBS and also having to provide around 68 crores that is at 5% of the advances restructured under the Special Rehabilitation Package 2025, the bank has still been able to post a 4.5% pyo y growth in its net profit for the nine months ended 12-31-2025 which has been recorded at 1566 crores.
We have been able to improve our. NIMS on a sequential basis despite a 25bps rate cut with NIM for Q3 recorded at 3.62% and that of nine months at 3.64% broadly in line with the expectations spelled out in our previous call. With the moderation of weighted average domestic term deposit rate gradually catching up, with the moderation in weighted average lending rate owing to the repricing of deposits starting to kick in, we believe the bank is on course to achieve the guidance for the current fiscal unless there is another rate cut.
We have also recorded a decline in cost of deposits and the same has been recorded at 4.69 for this quarter. The bank continues to exhibit strong cost. Discipline, keeping operating costs broadly under control despite the business growth and inflationary pressures with just a marginal 2.8% YoY growth for the nine month period. As a result, bank has recorded a cost to income ratio of below 56% for the current quarter. Continued improvement in asset quality despite the. Challenging operating environment in the current fiscal remains a standout achievement for the bank reflecting sustained and effective portfolio monitoring.
We are pleased to inform that we are on the brink of achieving our GNPA guidance of below 3% for March 2020, a quarter ahead of schedule with GNPA as on December 31, 2025 recorded at 3%. Gross slippages also continue to be under control with annualized gross slippage ratio at 0.83% for the nine month period and no credit costs for the nine month period. Our net NPA has also recorded a substantial improvement recorded at 0.68 as on December 31, 2025 versus 0.94% a year ago with the bank continuing to maintain adequate provision with PCR above 90%.
In our previous call we made a mention of the special rehabilitation package formulated to provide relief to the borrowers affected due to the disturbances in the duty of Jammu and Kashmir. Under this package which was to be implemented by December 31, 2025, bank has. Rehabilitated more than 10,600 borrowers with amount. Involved of more than 1400 crores on which bank had to take a provisioning of around 68 crores during the quarter. As mentioned earlier, CRAR has been recorded. At 15% with CET1 at 11.84%.
This is without reckoning the net profits for the nine month period which would have incremental impact of around 145bps. While the bank at present is comfortably. Placed in terms of capital adequacy, the board of the bank during this quarter has accorded their approval for raising an equity capital of 750 crores and tier 2 capital of 500 crores. The annualized return on assets and returns on equity for the nine month period have been recorded at 1.23% and 15.16% respectively, with ROA analyzed for the quarter improving to 1.35% against 1.16% for quarter two and both parameters well on track as per our guidance.
In the context of the system liquidity remaining constrained and and evolving customer preferences for high yielding investment avenues, the bank is revising its CASA guidance. However, this does not have any impact on our margin outlook for the current fiscal Market Guidance for financial year 2526 credit growth 12% deposit growth 10% CASA 45% NIM 3.65% to 3.7% return on assets 1.2% to 1.25% return on equity 15 to 16% gross NPA below 3% despite periods of disturbances and natural calamities impacting our home territory of Jammu and Kashmir in the current fiscal, we as a bank have remained focused and disciplined in our execution and on the strength of foundations built over the 87 years of existence of this bank, coupled with our persistent efforts, we are well placed to extend our streak of lifetime record annual profits for the fourth consecutive year, thereby achieving a double hat trick.
This remarkable feat is a testimony to the institutional strength and resilience of this bank and to the steadfast support of our customers and promoters who have journeyed with us through every phase. Thank you for your time today and for giving me a patient hearing. We can start the questions now.
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two Participants, you are requested to use handsets while asking a question. Before we proceed, we kindly ask that you limit your questions to two per person so that everybody gets an opportunity. You can join back the queue for any follow up questions and if time permits, we can take the additional questions later on.
Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sukrit D. Patil from Eyesight Fintrade Private Limited. Please go ahead.
Questions and Answers:
Sukrit D. Patil
Good evening to the team. I have two questions. My first question is as gross NPA have come down and gone down to around 3% and profitability continues to improve, how do you plan to build on this credit discipline while expanding lending in segments like MSME and retail over the next few quarters? What specific steps are you taking to deepen the bank’s presence in high growth regions outside Jammu Kashmir? Especially with cop, with competition intensifying from private banks and FinTechs. That’s my first question.
I’ll ask the second question after this. Thank you.
Amitava Chatterjee
Thank you very much. The focus on NPA recovery has been very very constant for the last nine quarters and more. We have not only reduced the gross NPA in percentage terms but also in absolute terms. So. This is the gross NPA that I am talking about. If you even consider the SMA March to December the SMA’s also have reduced by 50. So the prospect of adding NPAs is very low. The credit cost is nil. We have continuously been engaged in NPA. Recovery for quite some time now. So that is one part where the discipline on recovery of would continue to.
Be in focus for us. While I mentioned that credit growth has. This time been balanced between the rest of India and Jammu and Kashmir and Ladakh territories with almost 43% coming from rest of India and 57% from Jammu and Kashmir which is our home territory. And similarly the retail and corporate has also been balanced. So the idea of high potential areas. Has already started seeping in. So this is, this has been the strategy of the bank for the last one year and I believe we will. Continue to do that.
Sukrit D. Patil
Thank you. I believe. Is Mr. Ketan Kumar also on the call today?
Amitava Chatterjee
Yeah, kitten. You see.
Sukrit D. Patil
Yeah. Yeah. So my question to you is with. Net interest income slightly lower this quarter and capital raising plans underway, how are you planning to optimize the cost of funds while supporting loan book growth? Could you share, could you share how the bank is approaching Tier 2 bond insurance with an equity infusion and how these will support your medium term credit expansion and margin stability? Thank you.
Ketan Kumar Joshi
See the capital growth is in tandem with the business growth. It is required to supplement the business growth which we are foreseeing in next two years. Especially in the UT of JNK where government is. Central government has given lot of emphasis on infrastructure development and that will enable the region to have a lot of credit offtake and for which being a lead bank in the region we will also get that pie of credit growth. So to supplement that credit growth we expect that we will have at least 1500 crore of additional capital which will take care of that business growth.
And that’s where we are planning to raise 500 crore tier 2 more and then subsequently QIP. We are also targeting QIP to be completed by 31st March. However it may spill over a little bit based on the conducive marketing conditions. As far as cost of funds are concerned, our focus is on the retail CASA as mentioned by MD Sir. So our focus will remain on retail CASA and that too from the rest of India. And that will definitely offset whatever cost we are adding towards the tier 2 bond we are going to offset and it will help us in maintaining the adequate name.
Amitava Chatterjee
If you look at your supplement, if you look at the reduction of repo that has been for the year by 125 while our names have been affected by only 4042 bips. So we have been very vigilant about the kind of credit growth that we are doing which are giving us returns. So the net interest margin of all the banks have been affected because of this rate cut. But we have been able to maintain. The margins and I guess 3.64 is maybe 1 of the highest in the industry.
Sukrit D. Patil
Okay, thank you. Just on a closing note, it may be a great question but just from just to Understand? Are you expecting any positive outcome in. The budget coming soon?
Amitava Chatterjee
Steve, the entire banking industry wants some relief as to how they can get. Back the deposits to them. So I am not suggesting anything, but maybe some tax reforms can happen which. Will allow the investors to think of bank deposits once again. Most of the household deposits, as I mentioned, are shifting towards mutual funds.
Ketan Kumar Joshi
And also there is a demand from CIA to raise the standard deduction from 75,000 to 1 lakh. Probably that may be exceeded by. Minister of Finance.
Sukrit D. Patil
Thank you for the guidance and I. Wish the entire team best of luck for the next quarter.
Ketan Kumar Joshi
Thank you.
Operator
Thank you. The next question is from the line of Deepak Podar from Sapphire Capital. Please go ahead.
Deepak Podar
Yeah. Am I audible, sir?
Amitava Chatterjee
Yes, you are.
Deepak Podar
Yep. Thank you very much sir for this opportunity and many congratulations for a good set of numbers. So just wanted to check. In nine months itself, we have seen a growth of around 17, 18%. So for the entire year, I mean, have we revised up the guidance of 12% that we have been seeing in the last quarter?
Amitava Chatterjee
Thank you Deepak Ji for the compliments. In fact, I would still maintain the guidance of 12 to 15%. Especially owing to the fact that there. Is a stress on the deposit growth. Had the deposit growth been similar to. Advances growth, I would have said we would be growing at 20%. But we have to maintain the balance. The CD ratio has also reached 72% which I had promised at the beginning of the year. So I believe that maintaining this ratio we will be comfortably placed at 12 to 15%. In case we are able to generate.
The deposits which we are working hard. On, then the growth can be higher because the pipeline at the moment is. Very, very robust for us.
Deepak Podar
Okay, okay, I got it. And in terms of deposit, I think you did mention that some repricing is left, right? I mean, so how much percentage repricing is left and when is expected to hit the P and L?
Amitava Chatterjee
So what I meant was the repo cut directly impacts the lending rates
Deepak Podar
While
Amitava Chatterjee
The deposit rates are contracted for a period. So. The shift of the moderation of deposits takes some time, one to two quarters before it takes effect. I had mentioned in the last call that the NIM is likely to improve. By 5 to 6 basis points because. The effect of the repo cut had already passed on while the deposit rates took some time to moderate. So now you see there has been a 6 basis points improvement from last quarter in the NIMS. So this is how it works in the industry.
Deepak Podar
Yeah, so I understand that. I was just trying to understand when this entire repricing is expected to hit.
Amitava Chatterjee
I think by March, the entire thing. Will be repriced
Deepak Podar
By fourth quarter. So we do expect some improvement in. NIMS in fourth quarter as Definitely,
Amitava Chatterjee
Definitely. If you look at my guidance, it is 3.7.
Deepak Podar
Okay. And just one final thing. FY27, anything in terms of guidance, if you can help, that would be very helpful. Yeah,
Amitava Chatterjee
I would, I would keep that to the next call if you permit.
Deepak Podar
Because
Amitava Chatterjee
See there are, there are many. Many factors which affect the guidance. It will not be lower than the guidance we had for this year. Assuming that there is no material change in the environment. If there is a positive change, the guidance will be higher. If there is a negative change in the environment, it might be same or slightly lower. But we will try to maintain a kind of growth that we have done. For the last six months, four, five quarters.
Deepak Podar
Okay, okay, okay. And just one small thing. I mean you mentioned we are working on generating deposit. So, so can you, I mean can you throw some more light, elaborate more on. On. On what, what sort of steps we are taking? There
Amitava Chatterjee
See 80, more than 80% of. Our deposits are from the. Our home territory.
Gaurav Agarwal
And
Amitava Chatterjee
Out of that almost 48, 49% is CASA. So we are working on this home territory of all the deposits that we. May have lost in the last few quarters to get them back and also generate more deposits through IT initiatives. IT initiatives. I mean that using the QR code. And the POS machines, since we have a very strong presence in this geography. We are very accessible to all the vendors, traders, businessmen of this area. So this is one area where we feel that we have a very strong possibility of improving the CASA and the.
Total deposits through casa. I want to improve the deposits which will help in both the.
Deepak Podar
Okay, okay, I got it. I got it. And that’s very helpful. So that would be from my side. Wish you all the way best. Thank you.
Amitava Chatterjee
Thank you. Thank you very much.
Operator
Thank you. A reminder to all to limit your questions to two per participant. If you have a follow up question, please rejoin the queue. Again, the next question is from the line of Mona Kathan from Club Millennium Finance. Please go ahead.
Mona Kathan
Hi, good evening. I have a few questions. So firstly, just looking at the provisioning line, you know about 78 crore of negative provisions for NPA etc. So is there anything to read apart from the negative net slippages that we’ve been having?
Amitava Chatterjee
The additional provisioning has happened in the standard assets on account of I mentioned. There is a special rehabilitation package that the Reserve bank of India permitted on account of the disturbances that was created in Jammu and Kashmir on account of 22 April eventually. So.
Mona Kathan
No, my question was why is that negative?
Amitava Chatterjee
Negative Provisioning is on account of a. Big ticket size recovery that has happened. In one of the accounts where we have recovered almost more than 100 crores which was fully provided for. So that provisioning has got reversed.
Mona Kathan
Okay. And this was not a written off account.
Amitava Chatterjee
Oh that was not a written off account. That was an NPI account fully provided for.
Mona Kathan
Got it, got it. And over the last few quarters we had made provisions against the Grameen Bank. Are, are we expecting any reversals from the same in ensuing quarters or something that occurred this quarter as well?
Amitava Chatterjee
I will keep that to myself. At the moment we have a strong possibility of reversal provided that the Grameen bank starts performing well. It has already started performing well in the last quarter. It did well. There were some outstanding expenses which were set off this quarter. So from next quarter onwards we expect. The. Bank to do well. It is already performing well. The numbers are going to improve from next quarter and eventually we expect as per the master direction of Reserve bank of India we expect some reversal in these provisions also.
Mona Kathan
Okay. And just a follow up from the previous one of the previous questions on loan to deposit ratio. So it expanded to about 72% this quarter. So is that where we expected to sort of stabilize that the loan deposit ratio or we don’t see much scope of improvement unlike the rest of system that is much higher than 72 today.
Amitava Chatterjee
No, no, no, I’m not going to stabilize at 72%. We will definitely provided we are adequately. Capitalized as we are planning to be. I can expect the CD ratio to. Go up to 76, 77%.
Mona Kathan
Okay. And just one last thing. On the rids, I think as on March 25 the outstanding rids, you know in your balance sheet was about 9,000 crore plus. How much is matured this year and you know, do we continue to sort of invest in them to meet the PSI requirements?
Amitava Chatterjee
I guess the entire thing is getting. Matured in the next four, five years. Starting from next year I think around. 3000 crores is getting matured followed by around same amount in the following year. And if we look at our priority sector and the sub targets I believe unless of course we get the final figures for the year end, we. I believe that we will not be. Required to invest any more on RIDF for the next year. So we are going to get back that amount for further investment.
Mona Kathan
And this is because I mean we don’t need to invest more because we are organically meeting the PSA requirements. Organization. Yes,
Amitava Chatterjee
Organically. Organically. Through PSL lending. PSL lending. Along with covering the all sub targets. Marginal farmers, non corporate farmers. All those sub targets are also being met.
Mona Kathan
Got it. Thank you so much and all the best.
Amitava Chatterjee
Thank you.
Operator
Thank you. The next question is from the line of Gaurav Agarwal from nine one Capital. Please go ahead.
Gaurav Agarwal
Hi sir, thank you so much for the opportunity. There are a couple of questions. Your employee expenses, you know on nine month basis they are down yoy. So for this particular year I think will mostly be flat. Sir, for FY27 also do you think employee expenses can remain at whatever level they are? Can it go down or will you see marginal increase in them?
Amitava Chatterjee
The interest expenses depend on the interest that we. I am asking.
Gaurav Agarwal
Employee expenses. Employee expenses.
Amitava Chatterjee
Sorry, sorry. I got it wrong. I’m very sorry. Employee expenses are going down on account of retirement, right?
Gaurav Agarwal
Yes sir. So what is the way forward like for this year? They are going to be slight largely.
Amitava Chatterjee
It will not be flat. It will still go down. But we have plans to recruit people. But then if you consider the outgoing employees are high cost employees and the people we recruit will be at a lower cost. So overall the employee cost will remain low. In fact it is likely to go. Down further for some time.
Gaurav Agarwal
Great, great. So FY27, you know it can go down further from whatever number we report in FY26.
Amitava Chatterjee
Yes, yes, yes.
Gaurav Agarwal
And sir, provisions again you know this nine months it is negative. Do you have any further scope of write backs recovery which might prompt you to report near zero kind of provision number for. For next year. FY27
Amitava Chatterjee
I believe so we still have quite a bit of pipeline. I do not think that the credit cost will be anything positive by the end of this year.
Gaurav Agarwal
No sir, I mean for next year. FY27 this year is anyways 27
Amitava Chatterjee
At. The moment I will not like to comment because the. The near visibility is what I am looking at. FY27 might be much better. Because we have certain strategies lined up for next year. Once we are through with this year we will be going ahead with these strategies. For next year it can be much better. But at the moment I cannot predict. What will happen in 2027.
Gaurav Agarwal
So sir, based on whatever you’re telling me, I think next year we can easily do 17, 18% kind of ROE. Right. And because anyways even if you go at 14 15% your expenses doesn’t grow that much. Maybe single digit 4, 5% and it should all slow down. Right. So ROE should see an improvement at least 200 to 300 basis point is what my calculation says.
Amitava Chatterjee
And
Gaurav Agarwal
Anyways we are doing and what’s the need of. So that is fine, sir. What’s the need of raising capital at such low valuation? We can hold on for at least one more year. We don’t need capital as of now. What’s the need of diluting below book value?
Amitava Chatterjee
I have plans for credit growth which. Even if
Gaurav Agarwal
You grow 20%, you don’t need capital.
Amitava Chatterjee
I definitely need capital to be assured of.
Gaurav Agarwal
That’s my humble submission. You know, please do consider postponing it a bit. You know, we are raising capital when all the PSU banks are trading at such low valuations. Probably, you know, when things are better, when, when, whenever we get closer to book value or higher than what we are, we should at least contemplate raising them. Because it unnecessarily impacts your book value, you know, and is negative for everyone as a shareholder.
Amitava Chatterjee
Okay, we’ll think of that. Definitely.
Gaurav Agarwal
Thank you sir. Thank you so much.
Operator
Thank you. The next question is from the line of Arjun from Bauhead India. Please go ahead.
Sonaal Singh Kohli
Hello sir. Congratulations on great numbers. This is Sonal Kohli from Bohead. If you are not, can I ask three questions?
Amitava Chatterjee
Yes, Sonalji. Please go ahead
Sonaal Singh Kohli
Sir. Firstly, if you can explain the contours of restructuring. That’s my first question. So is it all done? Still anything else has to be done and what impact. I may end with the first 5, 7 minutes of the call. What the impact, if any you expect from it or what is the level of postponement of. You know him.
Amitava Chatterjee
See, the last date for restructuring was. 31St of December 2025. So there is. There are no further accounts for restructuring. We have done almost 10,600 accounts to the tune of 1400 crores. And we have provided for 5% of the assets. That is around 68 crores we have provided for. So no further provision, no further accounts for restructuring. And to be very honest, these are all standard accounts. So it is not postponement. It is. It was sort of lifeline given. I had mentioned earlier also the resilience of the people here is very, very strong.
So I do not believe that these accounts are going to turn NPA in. Any time in future. So I am assured that this restructuring will actually provide them a lifeline to restart and continue the business in there. In the way they were doing it earlier. And second, the business activity, tourism. It’s all returning to this state so. Gradually it has become almost normal.
Sonaal Singh Kohli
The second question pertains to loan to deposit ratio. If I remember, you know the prior MD the T Bank for almost 12 years, you know and you know, your past remarks as well. You know, in one interaction if I remember correctly, the long term plan is to take it to 78, 80, you know, over a three year period. If not next one, two years. You know, am I missing something here or you know in my understanding. Correct?
Amitava Chatterjee
No, absolutely your understanding is correct. We have taken it from 67, 68%. To 72 73% now. Along with it there was a 10% yoy growth in deposits as well. So I just mentioned that my target. Would in the medium term will be. To take it to around 77, 78%. And beyond that if all the regulatory compliances are in place I will be only restrained by the regulatory compliances, nothing more than that.
Sonaal Singh Kohli
You know, I don’t know sir, if you track other banking stocks but I wanted to give you a perspective. You know, the previous candidate, you know, participant did mention about the capital raise so that if you are going to make 17, 18% equity, you know, return on equity, if you even grow it, you know, 18%, you don’t need to dilute at all. I understand that you may have higher ambitions at some point of time, you may want to grow. But to put things in perspective, Jammu and Kristy bank is by far, it is not cheap, it is by far the cheapest banking stock in India in absolute terms.
And as compared to its ROI despite having such a high CASA advantage in the leadership such as yours. And therefore I think it will be injustice to all the shareholders including to the management of the bank and to the government of India. You know, if we were to deliver such a high quality franchise at such a, you know, cheap valuation. Just to put other things in perspective, this bank raised money about two years one month back at a 6, 7% higher price than today. After that the book value has grown immensely.
You know, as you yourself mentioned, to record years, including the last one under your leadership the book value next year would be around 145 adjusted book value. So if you put things all in this context, you know, if you are going to report what you have done, you know, over next two, three quarters, you know, many PSU banks are today quoting even above, you know, book value, you know, I mean you could trade at a premium to that and that would be, I think, you know, fair to management board state, you know, and the shareholders who participated in the past run rate.
So I will humbly request you to maybe, you know, not wait forever but maybe, you know, let people understand your story. Maybe go to the shareholders, hold an investment in Bombay, meet other fund managers, let the true price discovery happen. And I’m sure people will come in hoards to, you know, give you money like they did under the prime leadership that I think the IPO was described multiple times. People impose so much of faith in the bank. But if we go back today and value at low price than what we did two years back, despite all other banking stocks having risen, you know, it does not send the best of the message with, you know, you know, to the people.
So my humble request, unless you are in desperate need, unless you think there is going to be a, you know, planning to grow 30% or you believe that there could be an economic shock coming in, you know, do consider, you know, telling your story first to the street. The money will come in no time. It’s such a small amount, you know, compared to your profits. I mean your one quarterly profit would be equal to the amount of the capital raised. So just a humble request, if you can just internally deliberate, you know, in context.
If you need the data, I’ll be more than happy to provide you data of the ROI of the bank versus other banks, the price book multiple, the returns of this bank versus two years and therefore why we are seeing what we are seeing. Secondly, I understand that you have lot of investments which may be more valuable than the capital we are planning to take. Whether it’s taking the insurance company, the number of housing and flats, you know, all the value of the real estate you’re sitting on. So just a humble request to the board, you know, and we are happy to provide you enough data to support it.
Please keep that in mind.
Amitava Chatterjee
Thank you. Sonalji. Underlying compliments are very, very welcome. In fact, I’m pretty very, very happy with all the compliments that he showered on the bank. I’m very, very happy for that. Second, I have previously also, and now also I have already taken note of all the things that you mentioned and the data that you had already provided to me. I already have them with me. Third is we have taken a permission of the board, but the permission stands for one year. So I don’t think that you should.
Be worried about it. I do not intend to go to the market unless I am absolutely ready for it. So please don’t be worried about that. It’s just that we have got an approval and the approval stands for 12 months so we will definitely. Approval. We got it this quarter only. So it is, it is there for 3, 4 quarters now.
Sonaal Singh Kohli
So sir, if you go after Q2 results or Q2 results your price discovery will happen by then. You know,
Amitava Chatterjee
I’ll definitely keep that in mind. Sonal ji, I’m. I am absolutely sure about it.
Sonaal Singh Kohli
Thank you so much.
Operator
Thank you. A reminder to all the participants, you may press star and one to ask a question. The next question is from the line of. From 361 Capital. Please go ahead.
Saket Kapoor
Yeah, hi. Thank you.
Operator
Parth. You’re not audible. Hello.
Sukrit D. Patil
Yeah, hello.
Operator
Yes, you’re audible now. Please proceed.
Sukrit D. Patil
Yeah, yeah, yeah. My question is on Elon Advance. Our Elon advances have declined sharply over the last several months. Understand that there have been several repo rate cards. But it is very sharp. So are we clearly. Are we undercutting or underpricing our loans? Yeah, that’s my question.
Amitava Chatterjee
The yield on advances, if you look. At quarter three 2425 to quarter three 252626 it is less than 100bps while. The repo cut has been 125 bips. Okay. So I just want to tell you that almost 70% of the loan book, just slightly less than 70% of the. Loan book is in the territory, the home territory of Jammu and Kashmir and Ladakh. So the competitive rates that you are talking about is it constitutes only 20, 30, 31% which is in the rest of the country. Now even there we are focusing a. Lot on retail advances in rest of India.
So rest assured this yield on advances will not go down further. I believe. Yes, the corporate world is looking at. Very, very competitive rates but we are aware of that. And our focus has always been as a bank is on the retail and we will make up for whatever loss we make. I mean I’m not talking about loss. Whatever low margins we get out of. The corporate advances through the retail advances, that is one. But we also keep in mind that the corporate advances that we are doing have low capital charge because we are concentrating mostly on AAA rated companies.
So even if we are lending at slightly competitive rates to the corporates, they are very, very safe AAA rated corporates. So overall the safety, security and the margins we are trying to protect as much as possible with the reducing repo rates. It’s tough. It is tough for every bank. If you look at the numbers of other banks I believe that you will find the position of our bank much better than that. So I will not be that worried since the, the total reduction in the Yield is less than the repo rate.
That has been cut during this period.
Sonaal Singh Kohli
Sure sir. Thanks a lot.
Operator
Thank you. A reminder to all the participants. You may press star and one to ask a question. The next question is from the line of Saket from Kapoorko. Please go ahead.
Saket Kapoor
Yeah. Namaskar sir. I hope I’m audible.
Amitava Chatterjee
Yes, yes. Please go.
Saket Kapoor
Yes sir. It is just pertaining to the. The reversal of the provision entry. I was late to join the call. So if you could just for the sake of reputation the line item 8 and 9. If you could just explain the nature of the same and are we done with the provision of NPA or more is expected the reversal of the same going ahead.
Amitava Chatterjee
Are you talking about reversal of provision?
Saket Kapoor
Yes sir.
Amitava Chatterjee
Reversal of provision happened on account of a recovery in a large ticket size loan which was an NPA but fully provided for. 100 provision was there and 100 recovery has come in that. So we reversed the provision which was. There in that account. So this is only on account of one account.
Saket Kapoor
Right. And you were also mentioning about the hit where we have taken on account of the merger of the another bank. Another. That
Amitava Chatterjee
Provisioning is also completed. We have completed the entire provisioning on account of the impairment of. On account of the amalgamation of RRBs. That entire provisioning has been completed in the second quarter itself. So this quarter we did not have. Any provision on account of the amalgamation. And going forward there is nothing left for provision.
Saket Kapoor
Okay. So just to take into the account the code numbers. The code number stands at 780 crore as the operating profit and then. Then comes the provision part. So we need to focus on. On the 780 number itself as a non. As a operative number only. That. Only the. Only the book entry parts,
Amitava Chatterjee
The operating. Profit is before tax is 806 crores.
Saket Kapoor
Yeah, no, that. That takes into account the provision reversal part. That was.
Amitava Chatterjee
Yes, yes. See provision reversal that happens. If you look at this bank for the last three years there has been hardly any quarter. See we have been so. So focused on recovery of NPAs that we have had provision. Last year we had the zero credit cost. This year we have had for the nine months zero credit cost. So provision reversal is something which has been happening with this bank because of the focus on recovery. It’s not because of any adjustments that is being made. You see the provision coverage ratio is still above 90%.
We continue to maintain 90% and we will not go below 90%. So it’s a healthy sign. And the NPAs have also come down to 3%. So going forward I believe for at least one more year we will have similar situation. After that maybe the low hanging fruits. Won’T be there anymore. But then for one more year I. Believe the situation will be same.
Saket Kapoor
Okay. And lastly sir, on the nature of the other income part we take if we read the numbers for the last December quarter, in that quarter also the other income component was Significantly higher at 242 crore. And this year it is even higher to 280. So if you could just give some color on the granular details of what contributed to this and how is this line item going to shape going ahead?
Amitava Chatterjee
The other income mostly is contributed by the difference that you see. The recovery in return of accounts has been double of last year. Last year the return of recovery was 24 crores. This year it is 48 crores. So that is a major difference. In the other income we have also had additional income from the card business, credit card business which has improved it by 4 crores. We also, I think we have improved. The insurance commission by around 3 crores over last year. And most of the other items are almost flat.
And if you look at the quarter on quarter improvement, there has also been. An improvement of around 14 crores in the trading income for this quarter.
Saket Kapoor
Thank you sir. I. Thank you for all the best. And in the next month they. In fact in the month of March they will be. There are conferences happening when the year ends come and for in the month of March. So we’ll hope that our management also participates so that that will give us a more leeway to a larger section of investors to participate. There are. There are many conferences that happen on the Obra platform. So there is one of them in as Bharat Connect. That happens I think in the month of February itself maybe 15 days down the line.
So if you could just participate there, we will have a higher segment of investing community participation there and we can. Showcase the story there also. That’s the. We’ll be happy
Amitava Chatterjee
To participate. Thank you. We’ll be happy to.
Saket Kapoor
Okay. Thank you sir. And all the best with the team.
Amitava Chatterjee
Thank you very much.
Operator
Thank you. A reminder to all the participants, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. The next question is from the line of Sonal Kohli from Bauhead Capital. Please go ahead.
Sonaal Singh Kohli
Thank you again for the opportunity. Just one clarification. If it’s possible for you to share, they will ask you next quarter. What kind of names do you see over next 12 years. Broad range. We understand that no specific numbers can be given for such longer time horizons. But if some broad sense of a range to expect over a 12 year period if possible.
Amitava Chatterjee
It’s a question which I’ll have to answer from my heart instead of my mind. See, we have been able to maintain. Close to 4% for quite some time now. 3.74 is the current 9 months name. Next quarter ending. I think we should be somewhere. Sorry. 3.64. So somewhere around 3.70 for the last year ending. This is what I presume will happen. Maybe slightly better if there is no further rate cuts. But if there are no rate cuts I believe we will be close to. These numbers in future.
Sonaal Singh Kohli
And sir, was there any impact of restructured book on the NIMS by anyway this quarter.
Amitava Chatterjee
The impact was of 68 crores of provision only.
Sonaal Singh Kohli
Nothing.
Amitava Chatterjee
It. It is the. The impact was 6 basis points. Yeah.
Gaurav Agarwal
So
Sonaal Singh Kohli
Would that reverse from Q1 or Q4.
Amitava Chatterjee
Next year? Next year. Q. Q1. Yeah, next year. Q1.
Sonaal Singh Kohli
Thank you.
Amitava Chatterjee
Thank you.
Operator
Thank you. A reminder to all the participants. You may press star and one to ask a question. A reminder to all the participants. You may press star and one to ask a question. As there are no further questions from the participants I would now like to hand the conference over to Mr. Amitav Chatterjee for the closing comments. Thank you. And over to you sir.
Amitava Chatterjee
Thank you very much. Thank you Sapnali. And thank you all the participants for joining in today. If there are any further questions or queries you can definitely contact our investor relations test. So thank you all. Thank you. From JNK Bank.
Operator
Thank you very much on behalf of Jammu and Kashmir Bank. That concludes this conference. Thank you for joining with us today. And you may now disconnect your lines.