Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Union Bank of India Ltd (NSE: UNIONBANK) Q3 2026 Earnings Call dated Jan. 14, 2026
Corporate Participants:
Ajay Bansal — Deputy General Manager
Asish pandey — Managing Director and CEO
Analysts:
Mahrukh Adajania — Analyst
Unidentified Participant
Akshay Badlani — Analyst
Unidentified Participant
Kunal Shah — Analyst
Unidentified Participant
Ashlesh Sonje — Analyst
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen. Good day and welcome to Union bank of India earnings conference call for the period 12-31-2025. The bank is represented by the Managing Director and CEO Sri Anish Pandey. Executive Directors Sri Nitesh Ranjan, Sri Rama Subramanyam, Sri Sanjay Rudra, Sri Amresh Prasad and other members of top management. 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 in the conference call, please signal an operator by pressing Star then zero on your touchstone phone.
Please note that this conference is being recorded. I now hand the conference over to Mr. Ajay Bansal, Deputy General Manager. Thank you. And over to you, Mr. Bansal.
Ajay Bansal — Deputy General Manager
Thanks sir. Good afternoon ladies and gentlemen. I, Ajay Bansal, Head of Investor relations welcome you all for the Union bank of India earning call for the period ended 12-31-2025. The structure of phone calls shall include a brief opening statement by respected MD and CEO sir and then the floor will be open for interaction. Before getting into the phone calls, I will read out the usual disclaimer statement.
Asish pandey — Managing Director and CEO
I would like to submit that certain statements that may be discussed during the investor interaction may be forward looking statements based on current expectations. These statements involve a number of risks, uncertainties and other factors that cause the actual result to differ from the statement. Investors are therefore requested to check this information
Ajay Bansal — Deputy General Manager
Independently before making any investment or other decision. With this, I now request our respected MD and CEO sir for his opening remarks. Thank you. And over to you sir.
Asish pandey — Managing Director and CEO
Thank you. Thank you so much Mr. Ajay Banji. Good afternoon everyone. With great pleasure I welcome all of you to Union bank of India. Your bank financial advice results for quarter ended 31st of December 2025. Actually we are meeting first time in this. Calendar year and the third time in the financial year. So on behalf of Union bank family I wish you and your family a very very happy new year. Also today being a good day, it is a Santi. It is a and Bengal. So all are coming for next since yesterday to next few days which is a festive season across India.
So from behalf of entire Union bank families I wish you and your families happy festivities. Before we go to the figures, let me just set the tone the context. The first is the economy of the country like last year 6.5 to 6.7 band and other things. And now we see that expect around 7.4 in this year. So I think we are in the Goldilocks phase which is a High growth combined with the low inflation. And if we take the few initiatives, you know, like various reforms are taken. By various regulators, various reforms are building by the government.
So a few of that related to the government. The GST which came as a big enabler for various industries, various participants and the government CAPEX which is, you know, supplementing to the private capex as well. As far as banking is concerned. Our regulator since last one year I think 125 basis point. 125 basis point is a repo cut then CRR almost 100 point and the liquidity easing through omo effects and everything has happened. And so I think rationalization of various circulars. So I think these are giving the positive environment conducive to the growth.
And the same is happening coming to your bank Union bank of India Just as a part of initial brief in the ease agenda which be run by IBA and monitor supervised by dfs. It is across all public sector banks majorly with an objective of creating a good ecosystem facilitating to the growth to the digital and to the customer Service. We stand 2.0 and recently two few days back we had an IBA Tech award and our bank has received four technology awards. Also the best bank tech award. So I think with this brief we have already.
We had a board today and our audit committee and the board. The board has adopted the financial statements and the same in the form of a presentation. It has been uploaded to stock exchanges as per the. As per the regulations. And you will see that the. As far as the business figures are there mostly generally what. Generally the questions are asked. We have tried to inbuilt within the. Within the presentation itself. Meanwhile, the important point is you know. Related to the staff members. So that is why you will see one or two slides pertaining to our staff.
Because I am from this bank and when I came back I always see. The union bank staff unionize. Everybody will say. But then yes, it is a pet sentence for me. So that also gives a color like you know how many engineers. So almost I think out of 74,000, 32,000 approximately are like FRM engineers CS and other streams. So that is also a good composition. It’s just about training and other things. Similarly, the bank has started a project Muskan which is also related to ease. Of doing business actually more than 500.
We have actually done some bottom up approach survey. We have done a lot of groundwork and within that we are trying to sort out and streamline the things so that there is a Muskan project. Muskan is nothing but a very small thing like you know, the muskan in the face of our staff members and the customers. So actually the purpose and ob of. The project is to streamline, smoothen and. At the same time strengthen your risk. Mitigation across the bank. And certainly when you do all these things there is a cost cutting for sure and there is a technology.
As I briefed initially there is a lot of the technology already inbuilt in the bank. Whether AI sort of thing or whether the robotic process automation or whether even I would say the bank is one of the banks where two DC and two Dr. Are there all the four correct. So I think that is one thing. I think on technology our EDISA will also brief whenever you are having any questions. But at the same time coming to the financial performance. Net profit of your bank Is stood at 5,017 crores for this quarter ended December 25th.
Interest income is to get 26443. The business growth. Certainly here you will see the figure. Like you know, 5.04 and the gross advances increased by 7.13 and the total deposit grew by 3.36. But here before going further detail in the financials I would like to just inform you that very carefully we actually scrutinized, worked upon thought and actually brainstormed on each of our portfolio. And in a very nutshell the four pillars we worked. The first thing is that we already had, you know, the funds inside so around 40,000 crores, 38 to 40,000 crores.
We have shed off the burn deposits which was at the higher cost. So that is point number one on the first pillar. The second thing is the PGV is. Contacted by 15,000 crores. So that has moved over the credit side. The third thing is that we had. An IDPC which we discussed in the last con call as well. So that is now 20,000 is not there. So I think that is become zero. Then around 10,000. We had a some portfolio on a. Very low yielding that actually we move to long term loans. So there again we could gain something.
Now coming to the point in the. December 24th our NIM was around 2.91 and there is a rate cut of 125 basis point since then till 31st of December 25th. But then if you see from 2.91 we stand at 2.76. So I think that is where we could shield. And from September quarter if you see there is an increase in the name opposite way. So I think that is the key point which justifies that the work which has been done on the four pillars how it has been worked or impacted upon. So with this I think the capital ratios are all good.
The liquidity ratios are good. We have given in the presentation. And the growth in the RAM sector Suddenly increased by 11.50 21.67 growth in. Retail and 19 point. So robust growth is coming. Into the RAM segment. Even there is a growth I would say in the corporate but it would not be visible because 20 plus 10 30,000 crore we have churned within the portfolio. And certainly it is an inflow from new proposals, good proposals. And if you see the portfolio the. AAA 2A it is almost I think how much?
95%. So I think that is the level of the book which the bank is carrying. And while coming to the stretch side the GNP and NPA both have reduced. Both are at the comfortable range. And coming to the SME2 we are again at the very lowest level of 4285 crores. Above 5 crores. I think this is also gives a good color that the first time bank has crossed 10 lakh crores of advances. As a bank the return on assets is approximately one point. Not approximately exactly 1.35 which is again the highest one.
The ROE is again the highest one. CASA certainly it is point to be. Noted like you know 1.5% basis point. Is increased from quarter to quarter. So I think this is one of the good things which has happened. And you can see within the three months the reduction in the cost of funds and deposit is really very steep. And with this all suddenly the assets of quality of asset is being maintained very well. Is maintained very well. The PCR is almost more than 95%. We are comfortable. Cost of credit cost is again too low.
Sleeping ratio is again low. Keeping in view on this we have not actually put our money into the into the provision but we have put into the growth. I think this is one of the most pain points of the working of the entire senior management which are sitting there in this boardroom including half of our vertical head GMCMs and all. And with this I hand over to to you Mr. Bansal and to all our esteemed investors. For any quarry which they have along with me. I am accompanied with me with my executive directors.
Sri Niteshundanji Sri Ramaji Shri Sandhe Rudraji. Am with my all CGMs and vertical heads. You may please the query. Thank you sir. Thank you sir for your opening remarks. Now you can start.
Operator
Thank you.
Asish pandey — Managing Director and CEO
We
Questions and Answers:
Operator
Will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touchstone telephone. If you wish to remove yourself from the question queue you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes to the line of Maruk Ajania with Nuama. Please go ahead.
Mahrukh Adajania
Yeah, yeah. Hello. Hello. Congratulations sir to you and your team. So I had a couple of questions. Firstly if you see your interest income break down then the other interest is high. You know it’s around 205 crores, 206 crores and it’s been in the range of around 100 crores in the last few quarters. So what is the breakdown of this other income? Other interest income? That’s my first question and then I have one more.
Ajay Bansal
I think we’ll come back to you. On the exact breakdown but it also includes our income that we get from the, the PSL deposits that we you know that we place that’s a component. So we will give you the exact breakdown but it includes the rifd you can brief it is recovery. We have invested some funds that we are that the interest is being recovered is being done that being shown as the other income actually
Mahrukh Adajania
Other interest income. Okay. Yeah
Ajay Bansal
But
Mahrukh Adajania
How much? Yeah see around it’s 100 crores or what?
Unidentified Participant
See
Asish pandey
Other income consists of some more parameters which we will send you across now Coming to NNI madam Nil, let me brief you. There were two rate cuts in between. So you know that the our book MCLR is around 38%. The other remaining is the T bill. And the EBLR that is benchmarking. So I think you know the work which was done extensively so the NIH which we can because there is a good growth in the RAM sector and. The also corporate book which we actually. Worked a lot upon that. So I think that is why even though there is a good amount of rate cut and it was conveyed further but then we could have more sort.
Of a more sort of income even than compared to OD rids is 198actually that is the only thing.
Akshay Badlani
So I think
Asish pandey
That was the case. Of NII which you asked and. Also you know when you sanction it like you know we still have a around. 24 to 26,000 crores of disbursement. So generally you will see that most of the quarter you will not get. To to use that interest income because. It is you know once you Start. Sanctioning then it takes 10 to 15 days, 20 days time for the reimbursement. So then something has been sanctioned in October number then most of the things in December. So certainly the continuous and the regular.
Book which was sanctioned and disbursed. I think that has given a good results over to you madam.
Mahrukh Adajania
So yes. So my other question is that based on the draft ECL norms what would be the run rate impact as in what will be on an ongoing basis the increase in your credit cost if ECL were to be implemented as it is in the draft form?
Asish pandey
We have worked upon it madam. And if we take the total requirement. And the ECL keeping in view our book and the provisions we are already which are we are already holding if. We come to the netting position it. Is hardly 4200 to 4300 range. It is not more than that required.
Mahrukh Adajania
Right. That is the transition impact I am talking about on a run rate basis. So see
Ajay Bansal
Yeah Maruk, I think even. On a run, even on a run rate basis you can. You can see that you know our credit cost has generally been varying you know between the 20 to 40 bps mark. So while these are still draft and you know we await you know because we made some certain recommendations in terms of some changes that we want. Let’s discuss it once you know the final. Yeah the final guidelines come together. That will actually be the. The right way to look at it. We’re not expecting too much of a change in terms of our current credit cost versus the expected under ECS.
Asish pandey
Even if we see the SMA too our hardly 4285 crores in the entire book. So at the credit cost well within. Control level and now I am coming. To which is not an SMA. So 95% of the corporate book is A and above rated one. And so I think that is. That is the inference which you can draw. The book loan book is quite strong enough. Meanwhile the bank has implemented various early morning signals and now that FinTechs there is a software there is a seat on street and the entire system is working. So bank has strengthened the collection systems.
So I think that is a robustness is there so we do not much worried about that. The transition as you said migration is not much right now. But the run rate as you said let us see how it happens but then we are on the safer side.
Mahrukh Adajania
Sure. And what would be your estimate to below 5 crores?
Asish pandey
Below 5 crore I think it will be hardly in the range of 24 something like that.
Mahrukh Adajania
24
Asish pandey
25, 24, 25,000. Because generally what happens. No that the. The. When you apply the interest and many of the companies it comes very next. Day in the sense morning. So SMA0 is.
Ajay Bansal
We’ll give you the exact number because we don’t disclose that in our. In our presentation we only disclose about 5 crores. So we’ll come back to you on the below side.
Mahrukh Adajania
Thank you.
Operator
Thank you. Next question comes from the line of JJ. Mundra with ICICI Securities. Please go ahead.
Ajay Bansal
Hi. Good afternoon sir. And congratulations on a good number and revival in the loan growth. My first question is on. On the loan growth. You also talked about that there are ongoing mixed changes within corporate and some of the lower yielding loan book getting transferred. So amidst all this how should one look at the loan growth going ahead? Is this mix change is broadly over and can you like sustain this 4% or maybe higher QoQ loan growth and how soon can you reach industry level loan growth on a y wide basis?
Asish pandey
Yeah see you have actually grabbed it you know around 30,000 crore in the. Corporate itself which we have churned out. So that is explicitly actually it is visible like you know how it is and what would be the actual growth. Now it is a very big bank. It is an exercise which we have taken very cautiously. There will be something going forward in. This quarter as well. But the thing is that the way in which we have grown in this. Quarter certainly the growth in this last quarter will be more than that.
Because when you galvanize the entire machinery and you move into even right now in the corporate only I am saying around 24 to 26,000 crore is the sanction and disbursement pending. And we further have a good pipeline in various stages of sanctions. So I think what this is the like you know the start with. So we expect better than this in the. In this quarter and yes we the aspiration the market which is having the. Growth is certainly is our aspiration and. We will be moving in that line only.
Ajay Bansal
So I mean to conclude what we are saying is that this kind of a run rate growth on a QOQ basis can be sustained and you would be hopeful of achieving industry level growth yui basis soon. Right. That is the. That is despite all this. Yes.
Asish pandey
Better than this one we expect better than this one we expect in the coming quarter.
Ajay Bansal
Thank you sir. And secondly sir if you can highlight was there any provision carved out for gratuity leave investment for the under the new labor code. Because I believe that was like mandatory. Right. You all the at Least the gratuity part was mandatory. Have we done heavy provided if you can quantify that number.
Asish pandey
Yeah. See there are two things in the labor code broadly. The one is on the welfare benefit side. So certainly what is there in the code and what is given in the banking industry under by part time is much better. So that is out of question. Now coming to the second one. Like you know the engagement gratuity and other things. You see this is you know bank which are you know for a long. Like year 107 years old. Now this impact is more which are younger age banks because you know moving from five years to one year and other things.
Now up till now they were not. In that group because five years was the minimum. But in case of you know the banks like you know our and other. Public sector banks the impact may not be much. But at the same time as per our conclusion maximum it will be in the range of 10. Because some of the code, some of the rules yet to be received. So that is what we are meeting even right now. And because see there is you know as per the bipartite there is a basic pay and then there is a special way. So there is some even clarification and.
Other things which means under discussion. But then maximum I think as per our calculation it is coming in the. Range of 10 to 15 crore. Not much.
Ajay Bansal
And this is for. I mean this is what we have done already in this quarter. Or you know this can be a. This is the only impact, right? 10, 15 crores, nothing material. Yeah.
Asish pandey
It will not be because gratuity. Actually we are already doing. No. So that will not make much of a. Yes,
Ajay Bansal
Okay, understood. And sir, another thing is on trade release measure, right. So during the RBI during the quarter RBI had given a dispensation for moratorium for exporters. If you can quantify what was the request in rupees crore for our bank.
Asish pandey
Yeah, actually the total, you know till date we have sanctioned around 78 of the proposals around 500 crores. And within which 61 proposals of 216.64. Crores are already been disbursed. So actually we already, you know we. Met with various clients in last three. Months and there were some specific pockets as well. So we understood the requirement and as a you know the conduit for the. Economy and the measures which are taken. By the government of India and all these are very good companies actually.
So like you know, various rated also. In the good standing. So there are a few more proposals actually are there. But we can be Pipelined. But this one figure I am giving you is the sanction and disbursed.
Operator
Thank you Mr. Mundra. Please rejoin the queue for more questions. Next question comes from the line of CA Dr. Ashok Ajmera chairman with AJCON. Please go ahead.
Asish pandey
Yeah. Thank you for giving this opportunity. Good afternoon sir. Ashishar and the entire team of the Union bank compliments to you. For. Especially for the net profit going beyond 5,000 crore. 5,017 crore in this quarter. Which is very heartening to note. The bank has been in the range. It has come I think in the fourth quarter of 2025 at around 4,985 crores. But crossing 5,000 crore and coming to 5,017 is really a commendable job as far as the profitability of the bank is concerned. Having said that sir, my.
I echo the same sentiments of one of my other colleague also about the growth in the. In the business. That is overall the advantage in the deposits we have. While in this quarter we have addressed the credit growth. At least in this quarter we are positive 4%. And going forward you are already assured that the coming quarter will be better. But still if you look at the. I mean the deposit growth that is just 0.95%. And the overall if you take nine months also it is only 3.88%. So unless we match that like how are you going to increase your advances when your CD ratio is already 83.89%.
Your CRR has come down to 16.49%. So how do we with this kind of deposit in spite of all the churning. Because if you look at even last 7 quarters also the deposit growth is only 2.19% over the 7 quarters right from the FY Q1 of FY25. So what is going to be drastically
Ajay Bansal
Done by you so as to bring the deposit also up to match with your credit growth target? Sir,
Asish pandey
See. Thank you so much for the appreciation to the bank, your bank and the staff members. I would put it one very clear. Way that you know the raising of. Deposits is not an issue and it was not an issue. Actually we knew where the money is. And where to deploy. This is what exactly we have done last three months. Now you. If you see the three, four things then probably you will understand that otherwise you know excess money has cost more. Rather than creating a value more. The first thing was the treasury because we have shed off 40,000 crores of our bulk deposit and which actually helped us in reducing the LCR requirement.
And we had a huge excess SLR. And other other securities as well non SLR. So 15,000 crore of PDU book is. Contracted and we have shifted there was. A gap of 3 to 4% because our domestic CV ratio is below 81. So in that case we have 3 to 4% of the range to go about it. Second point, third point is first time the CASA of the bank is increased. By 140 basis point. Now if you take the CASA around 8 to 9,000 crore CASA is increased. Meanwhile the retail term deposit actually that there is the question comes.
So they are put together both around 15 to 16,000 crores. There is an increase now that portion if you. You know 15, 16,000 plus. Further if you take 15,000 crore of my 30 book so state I mean you are getting 31,000 crore which is a resource for me for the. For the end even if I am not taking the CB ratio increased by 3% point and that is the reason outcome if you will see the CD ratio is within range. The NCR is within range the NSAPR is within range and all the ratios which are required on the board approved are well within range.
So for here absolutely no issues. Now coming to the coming quarters. Now coming quarters every bank is having the asset level being and certainly we are working upon that. But more so we are working more on increasing the CASA. So last quarter itself we could get 140 basis points. That is a good steep increase and which has resulted even though the two rate cuts from September the other onwards. So I think even in that scenario if the mean is increasing does this say good sort of a color and influence.
So now coming forward to this and also when we talk about deposit it is not the only resource. You know there is a resource of refinance, there is a resource of so MSME refinance. Also we have done to an extent of 5000 crores. So we have as a bank when you manage places you have various resources so keeping in new resources. And there’s the reason that all the ratios there is no abnormality. And actually this is the reason why this time at least five efficiency parameters are taking the highest ones.
Now coming to this quarter we already have a strategy in place. There are three, four new structures are created. One is the ecosystem banking and the. Team is working really hard and it is a very structural some change which. The bank has done. Probably the next time we meet somewhere. In April certainly we’ll be in a position to speak more about it.
Ajay Bansal
No point well taken sir. Only thing that now
Asish pandey
At least a time should come when we are at par with the industry or even better which used to be some time back also. So. And that will ultimately be requiring the deposit by whatever means it comes so as to match the the growth. There are other means available. I mean liquidity is there with you. But this mismatch has to be answered, sir. So point well taken sir. One of my other small observation is while the operating profit has gone up by about 100 crore in this quarter, 120 crore something. Our net profit has gone up substantially.
And the main reason is that the provision on standard asset has come down to 176 crore as compared to 882 crore in the last quarter. So going forward, and that is the reason our trade cost is also very very minimal. So going forward can we, can we take it as if the provisioning will be less only and the more profit will remain coming in the books only. Coming to your provision. Certainly we need to look into three. Four, five ratios or parameters. One is the sma, one is the loan book and one is the PCR how much and one is the GMP and npa.
So I think these four five things very clearly tells credit cost. I think these seven parameters. This gives a very good inference that. What could be the provision requirement going forward? Number one, number two, coming to the op. See when you are seeing this group you are, you are, you are always. There because you know in all the concords and in this meet in the month of June, September, this quarter and. You have seen what happens now. Whatever credit growth you are seeing, you. Say even if you add 30,000 crore further it is 9%.
See what happens. It doesn’t happen on the 1st of. October, it happens during the 90 days time. Now that something would have been done because if you start working then something happens in November, something happens in December. So the entire, you know the. That is why the important thing is. What is your average advances growth and average deposit and average CASA growth. Actually in our bank we are totally. Working upon these three figures. Now the thing is that once you have achieved the growth in the next quarter certainly you will be in a.
Position to get the interest income out of that. So you cannot eventually spread out. For the 90 days. So probably like you know in the month of December. Because once you sanction so sanctioning itself I will tell you things say minimum. 20, 25 days but then the disbursement. Further takes 10 to 15 days. So I think this also gives an impact how it would have been spread. Over the 90 days. So I think the like you know the asked op. So we expect OP to be. Though though I I will tell you again the the net interest income and.
You see again the factor of reducing rate of interest. But then we have shielded even in the 90 days period with that given. Circumstances which we grieved you. But even when we have shielded we. Have made it better. So I think we actually expect better than this performance in the coming quarters.
Ajay Bansal
Sir, can you give some color on our technology upgradation and the technology budget, IT budget and
Asish pandey
Where are we placed and is there any major ease of doing business? Something major is being done in the technology front? Yeah, I think initially itself I told. About these and I told about IBA Technology award and Project Muskan since our Ed Sahib is running this project and. So many things in the bank and actually when we get a bestech award. I would like him to address this to all the investors. Yeah,
Ajay Bansal
Thank you. So Ajmaraji, as you heard MDCO in the beginning that the current focus of leveraging technology is also to create convenience for our employees which will ultimately get converted into convenience for our customers. So under Project Muskan we have currently identified around 300 odd processes which we are trying to simplify so that our employees can serve the customers in a better way. And as we progress more and more processes will be covered under this project for the simplification.
But otherwise as you asked about the budget we have for this year around 1600 crores of capital budget for the technology and it is higher than the previous year’s level also. And that is going on the strengthening the infrastructure network as well as strengthening our cyber security framework. Currently we are in the process of implementing phase two of the Resilience center of Excellence which is more of proactive approach for responding to the threats and the disruptions. The next gen Cybersecurity center of Excellence that we have established that is also almost at the kind of closer stage maybe couple of months we’ll be doing and that is again the most advanced technology so far as the security operation center and the Cyber Security management is concerned.
You’ll also be happy the investor community will be happy to note that bank is an NBC touch in the beginning that we are already running on the not only the dcdr but near DC and near Dr. Also on top of that the digital banking platform that we have established it is actually having a foresight architecture which always active active and auto load balancing. And in terms of the uses, if you look at and I think we have given the numbers also somewhere that today almost 80% of the liabilities had relationship liabilities and accounts are getting opened using the digital means.
Similarly on the lending side some of the low ticket loans on the retail agree and MSME you are already doing on this and you would have also noticed in our presentation we have touched a bit on what we are going to do in the next for the digital and technology because now we have the right setup infrastructure and we have to leverage in terms of business. So we are setting up a digital business vertical which will ensure that we are approaching our customer and serving them digitally through the three approaches.
One is the do it yourself for the customers who are very tech and digital savvy who can get the banking services on their own through the links and the icons available on the website apps and the social media channels. Second is the assist channel which through our call center will be assisting the customer in completing the journey. And third is that doing the digital approach of business at the branch level. So that is what the approach is now. I think today we are all set to kind of ramp up the business contribution, profitability contribution from the digital.
Thank you.
Operator
Thank you. Mr. Ajmera, please rejoin the queue for more questions. Reminder to all the participants please distinguish yourself to the question. Next question comes to the line of Dikshit Toshi with Whitestone Financial Advisors Private Limited. Please go ahead.
Ajay Bansal
Yeah, thanks for the opportunity. A couple of questions. Firstly you know in terms of provisions you did mention that it has come down but going forward to meet the ETL provision do you expect that we’ll increase the standard asset provisions or it will remain at lower end only. And my second question is in the so in H1 we did not had any PSLC income but a small amount of 100 crore has come in this quarter. Going forward from next year onwards can we go back to the level of FY25 what we have done?
Asish pandey
Yeah. Doshi for this you know a very good question and I am thankful to you. We have noticed very keenly. So the first part related to UCL. I would request my ed staff Rudraji and for PFLC I would request my ED staff Mr. Ramadi to answer. Yeah, good afternoon, I am Sanjaya. Regarding the provision part which you said has come down basically if you see our total slippage for the quarter December, December quarter is around 1800 crore and. Almost the recovery and observation is also. To the extent of the similar amount.
So there is a. And we have, we are standing at. A PCR of 95%. So whatever the provision was required for the fresh liquor accounts we already had. Adequate release from the recovery and upgradation which has happened. So there was limited requirements for provisions. That is why our credit cost and provisions requirement has come down going forward. Whether it is a sustainable or not. Yes, we are working very hard on the containing the slippages and and if. You see there is no corpus has. Not happened and going forward it should be also be well managed.
So we are confident that our provision. Requirement going forward will also be on a lower side. Regarding the ECL ECL part see we have already made adequate provision as you know the IGAAP we have made a 95% provisions and on. Half yearly basis we are making the. Assessment on the IND also. And what we observed that there is a gap between earlier the gap was high but gradually over a period of. Time in the 23 years as we reached to a 95% provision our ECL provision requirement has come down and there.
Is not much gap between the existing provisions and the required provision under the. ECL guidelines And bank is well placed. Bank is having the equal profit to take care of the provision requirements under the acl. In fact in the guidelines that five years dispensation is given to meet the requirement of the provisions requirement but most likely bank may not go for that type of facility. Bank is well capitalized and profit is. Adequate to take care of ECL provision requirement in the first year itself.
And that is as far as the ECL is concerned. And regarding PSLC profit. Yes we tried but in the first half of the financial year we were. Not having any opportunity to sell the. PSLC certificates which we did in the last year. Last year we did a very good. Business on account of the PSLP sale. It was around 950 crore of the profit we booked in the first half year. But this year that opportunity was not available and gradually the portfolio was built. In third quarter we were able to sell a small amount and we booked.
A profit of around 108 crore going forward also the department is working very hard on the priority sector lending and. We are hopeful that next quarter also if possible we will try to sell. Some PSLC to have an additional profit. But definitely the going forward in the. Next year onwards we think we will be able to leverage the PSLC PSL. Book and we will be able to. Book a good amount of profit going forward.
Ajay Bansal
Yeah. Thanks for the opportunity.
Operator
Thank you. Next question comes from the line of Bhavik Shah with incredible research. Please go ahead.
Unidentified Participant
Hey. Hi. Thanks for the opportunity and congrats on very good results. So two Things first. I think if I look at our investments book I understand we have sold a lot of for mutual fund investment around 10,000 crores. And overall also we have sold some SLR securities. And your income on investments in the. Interest income earned line have gone up by focusing. I just wanted to understand like what’s happening here. If you can kind of help explain. And also is your treasury gain mainly. Because of the mutual fund sale income or.
Yeah,
Asish pandey
No, it is I think the. Normal treasury operations if last quarter also if you that NSPL if you decrease that was around 500 crores. It is in the same range now coming to. You know the treasury the banking job. Is to lend first and on the quality assets and create a long term asset. So you know even if now if you see what is the yield in. The SLR or non SLR and if you see the what option you have when you lend it into the detail or not I say but then MSME and the corporate and the mid corporate. So probably certainly the option number two is much better.
So that’s the reason we contacted our. TSD by 15,000 crore and shifted it to better building and better quality assets.
Unidentified Participant
Okay. Okay. And sir, is your treasury in of 580 crore mainly because of sale of mutual funds or. No, that is not the way to look at it.
Asish pandey
See it will be like. You know the foreign exchange income will be there then certainly when you sell. It from the HTM and certainly sometimes maybe you play with the you arbitrage. Also you you do it. Some swaps are there. You can brief. This includes the mutual income also this a part that is HTM sale also is there then exchange income also because of this fluctuation we could g more exchange income. All these have live to this 900 treasury income. If you compared with the Q3 of S4 which are grown substantially above that number.
Operator
Thank you Mr. Shah. Please rejoin the queue for more questions. Next question comes from the line of Kunal Shah with Citigroup. Please go ahead.
Kunal Shah
Yeah. Hi. So a couple of questions firstly on the recovery part. So when we look at the recoveries from written off account compared to the run rate over past five six quarters it has come down a bit and overall recovery as well. So where should we see it settling over next? Three to four odd quarters?
Ajay Bansal
Yeah. Kunal, if you’re looking at it the recovery actually what we are having earlier you cannot be comparing because the portfolio which we are the new pages are very very much less actually. And that bank is also trying to see that what are the leftover recovery we have been getting with various types like OTs, NCLT. Everything you look at in the last quarter our whatever the recovery around 3,000 crores or 2,800 crores are recovered. If you look at it, the maximum recovery in a single account is only 130 crores and that is the only account above 100 crores.
So we are concentrating on the MID account on the small accounts for under try to get the recovery for maximum extent possible going forward. Yes, we will be expecting this quarter there will be some recoveries are expected. But I think it will be based on whatever the leftover portfolio which we.
Asish pandey
Will be able to do that. There are three levels. One is, you know, through NCLT or the other route. Another one is the, you know, you go with the OTS and with the party bypass site. Another is the smaller amounts. So maybe the property sale and other things taking association and all. So the. The normal one is always there and we are actually better than the earlier quarters. Actually we expected, you know as. As you said we were doing good. We actually were expecting some C4 accounts. We cannot name them.
It was very close. But then probably we may see defaults in this quarter. Probably.
Kunal Shah
Sure. And just a clarification on provisioning. So last quarter you indicated some prudent provisioning done towards ECL and that’s why standard asset provisioning was higher this quarter. I believe from your explanation there doesn’t seem to be any provisioning towards the ACL in this quarter. And second is on the fraud. This is. Okay, maybe what the provisioning was done. So was it like 100% provided earlier and there was nothing which was provided during the quarter for the fraud which were reported this quarter?
Ajay Bansal
Yeah. So Kunal, you’re right. We did mention in the last analyst call that we’ve taken from you know, additional standard access provisioning to reduce the buffer that you know that’s required to meet the ECL provisions. You’ll see that we’ve done that in Q1 as well as in Q2. You know, given the low slippages in this quarter as well as the PCR of 95% we did not feel need to make any standard assets provisioning in this quarter. So that explains why not seeing a big standardized explosion in the current quarter.
Operator
Thank you Mr. Shah. Please rejoin the queue for more questions. Next question comes from the line of Jainam with Jnwelt. Please go ahead.
Unidentified Participant
Hello. Congratulations on the great set of numbers. I would like to ask you two. Basic questions which are do you expect. NIMs in FY 2027 to improve, stay stable or moderate and what will influence this? And the other question is what kind of revenue mix are you expecting from retail book and MSME bookends your.
Asish pandey
So I could not understand no second only. Moderate or something Please can you repeat please? Sorry, we could not get it.
Unidentified Participant
Do you expect the names in FY 2027 to improve or stay stable or moderate? And what is going to influence this?
Asish pandey
What is going to influence it? Influence it over.
Ajay Bansal
Okay,
Asish pandey
Okay,
Ajay Bansal
Okay. You would like to take. Actually what we see that the name will further improve because the whatever the deposit was taken that is going to be repriced in this this quarter or next financial year and the impact you have already seen our book that our MCLR related books are only 32% and the balance are in the in the shape of the they are linked with the external rate of interest when the rate cut happens the impact of the rate cut automatically passed on to that deal but the deposits and cost of fund is being reprised after the maturity period so definitely if that happens in the this quarter and next quarter onwards definitely NIM is going to improve there is our expectation.
Asish pandey
So I think what you asked no. Like just to support Ed Amreza the. Actually last time also same thing was asked we only said one thing we would like to defend but then we have come better and again we would like to say to you we will. Defend Let us see how it happens. In the mansas now coming to the parameters which is going to influence it. See, the one thing is that in the downward division scenario when reporting is being cut suddenly you will see, you know, because there is a lag. The. Deposit lag behind by few few months.
Or quarters but then there is an immediate impact on the loan part, asset. Part so I think that is one thing but even then we have defended so that is one part Second one is you know the how you place yourself with the CASA and how you place yourself with the retail term deposit and how you place with your total deposits and I think the more important thing for the lean is that how you manage your average advances during the quarter because the last moment will probably. Not make it more so I think.
We all are working in the same. Line Just I wanted to supplement the first part which Amrezha VD has already. Told the parameters which you have asked. I think this one the second part. Of your question was that how you. Foresee the RAM that retail and MSME and growth and and corporate so what. I would like to suggest my Ed. Ramasa will tell you on the RAM side and from the corporate book side our EDC MSG will be. Yeah, so if you’re looking at
Ajay Bansal
The retail and the MSME consistently this year we have been showing a good growth Year on year it is around 22% and 20% agree. Yes, we had some issues but if you look at it in the last quarter we have picked up and we have shown a good growth on the agriculture going forward we will be driving it because Vista all have to be done by the field at the branch level. So we will be driving the this business and try to maintain the same 58, 42 or 60 ratio between Ram and the carpet. Regarding the growth of the.
Regarding growth of the corporate book Sir, MD sir has already said we are having some pipelines already, sanctions are there and some good number of proposals are also in hand which are going to be sanctioned this quarter or we don’t see any challenge in growing the corporate book also Sir. Thank you.
Operator
Thank you Mr. Chair. Please rejoin the queue for more questions. Next question comes from the line of Parth m. Kutka with 361 capital. Please go ahead. Mr. Gutka. Please go ahead.
Unidentified Participant
Yeah. Hi sir, thanks a lot for the opportunity. What is your, you know NIM guidance for FY26?
Asish pandey
Yeah, Nim, I think we have already discussed in the last quarter also when. We met on 28th or 29th of October, the one stand which we communicated that we would like to defend it. And let us see. So actually we moved better though the. Condition or maybe the scenario was towards the downside. So still we will say that we would like to defend 2.76 but then we hope for a better. I think though you may be finding a different scenario. But then there was some opportunity in our, you know, shuffling from the book.
Which we have done.
Unidentified Participant
Okay, okay. And second question, how much of the deposits are yet to reprice in terms of retail term deposits and. And certificate of deposits in quarter four?
Asish pandey
Yeah. See the deposits which are going to mature in this quarter are in the. Range of 1 plus around 50 lakhs. So that are under different rates. So it consists of even the bulk. Side and it also consists on the retail side. But how we are looking at it, you know the composition should be in such a fashion that doesn’t impacts my LCR number one. Number two, the high cost. We are very keen actually. We are very, you know, even when we are quoting we are very specific to the quotation in the financial institutions.
We are actually not quoting at the higher rate because the runoff factor is 100 on that. But meanwhile we have created a different structure. Probably the only bank which we have. Created is ecosystem banking which is headed by a very senior official at the. General manager level and he’s having almost 1600 people under him across India and he’s having units at various locations. So that is the effort which initially if you want to know the initial. Sort of a results that CASA has been improved with 140.
So we are actually thinking more of adding RTD, adding CASA and then to an extent left out. We will be taking the deposit but certainly in a range which is acceptable to us.
Operator
Thank you Mr. Gutka, please rejoin the queue for more questions. Next question comes on the line of Anthriksha with ICICI Prudential. Please go by it.
Unidentified Participant
Yeah good afternoon sir. Just wanted to ask what is the size of the gold loan book that we have both in retail and agri.
Asish pandey
A gold loan portfolio is around 84,000 cr total. Actually you know let me share with you the the we were hovering at the same level for past two quarters. But now this quarter can increase of around 2,200 crore. But at the same time we were actually it is not like the revenue is not there. It is not like you know we didn’t want it but we wanted to. Strengthen the system is procedure in that. And actually we have done it somewhere. In the month of October and November. And now we are poised for taking it forward.
So I think that we will move forward and our yield is also good. Actually it is coming around up till. Now I can take not exactly with the quarter but the nine months is coming around around 8.859% levels
Unidentified Participant
This year. Saying agri
Asish pandey
I’m saying about gold level. With all the three total agree agree is about 48,000
Ajay Bansal
I I.
Unidentified Participant
And this wanted to incrementally what LTV are you doing these loans at in agree as well as.
Ajay Bansal
Yeah difference on 75 in non agree actually LTV and 85% in agreement.
Operator
Thank you Mr. Anthrax, please rejoin the queue for more questions. Next question comes from the line of Akshay Badlani with HDFC Securities. Please go ahead.
Akshay Badlani
Yeah hi. Thank you for taking my question. So on the credit cost just wanted to understand so why like we were you used to be around 6525 bips kind of an average run rate. We have come down to 10 bips as of now. So is it largely because of slippages coming down or is there some one off in terms of write backs or. Recoveries that we are getting that the credit cost is at this range and. What would be your steady state credit. Cost that you would guide for going forward sustainably?
Asish pandey
I think if you see the movement. Of the provision, probably it gives some color out of it. According to the second point, there are. Six, seven parameters with the earlier questions which I replied. The one is the corporate book, what is the rating? So around 95% of the total loan book is BBB and above. And mostly it is in A and above. So that is the first part. The second part is that the FMA position which we have already given the. Presentation almost lowest right now in the absolute terms which is 4285 crores.
So this is the second point then. Third point is that the slippage ratio. Is also well within control. Actually the bank has taken. You know why you have strengthened the. Credit book on one side. The another side is you have developed. The better collection efficiency mechanism using the. Using the software apps and feet on street. So now actually that is giving the results. So going forward we do not expect some, some, you know. Much of the things we think in the same fashion to go going forward as well.
Akshay Badlani
Understood. Second.
Asish pandey
Probably see my restructured book because there is one more portfolio from where this, you know, the credit card equipment has come. So if you take my research book Also even the 50% of that is we have realized already realized as an mpa. So the question is that when already you have taken care of the things probably we do not foresee, you know, until unless the situation goes something very. Heavier like Covid or something like that, we forcing in a similar fashion to go forward.
Akshay Badlani
So. So any guidance around credit cost like. What we could give like. Yeah, in a similar
Asish pandey
Way like one or one or two quarters which you’re.
Ajay Bansal
Saying in the same range. Yeah. If you look at our nine month, you know credit cost is about 20, 26 bits. Right. So I mean what sir is indicating is we would like to, you know, try and achieve that kind of a number going forward. Yeah. Including you know, because we have also evaluated, you know, as in the UCL comes in. Right. So it will be a number which will move but hopefully around that.
Operator
Thank you. Mr. Badlani. Please rejoin the queue for more questions. Next question comes from the line of with Kotak Securities. Please go ahead.
Ashlesh Sonje
Hi team. Good afternoon. Two questions from my side. Firstly, if I look at the total recoveries which you report in your presentation on slide number 15 in FY25, you did upwards of 15,000 crores on paper recovery going by the new presentation which you are sharing in so far in FY26 you have done some 9200 crores. So what do you think about the run rate? What do you think about the outlook for FY26 and FY27 on this number? That is one. Yes, please go ahead
Asish pandey
On the recovery. Since you are asking me what is the going forward, correct? Yes. What I. I actually told just comparing
Ajay Bansal
To the last year portfolio is different now the are coming down actually. So still whatever the available we have. Already done for 9200. We expect that as Sara already told there are some recoveries which we expected in the last quarter which we will be releasing it. We will be. We will be ending up around the. I think the most probably with you’re not giving any guidance this year. So I cannot exactly number. But you can expect more or less. The same average what which has been done in the last three quarters.
It will be there.
Ashlesh Sonje
Understood sir. And going forward is it fair to. Assume a decline of let’s say about somewhere around 10 to 20% every year going forward in that number.
Asish pandey
Put it differently, not per se about. Our bank or something like that. It is the effort you have put in and the structure you have put. In for the recoveries. Still the book is always there. But you know some windfall happens when. There is an entity resolutions. So the thing is that if you are talking about the regulation recoveries you may expect better than that because there are three baselines. One is the normal regular recovery. Another one is, you know when you. Get through NCNT or some the bigger resolutions.
So bigger resolutions because we were expected. Actually last week of last 15 days of the last quarter. But that has not materialized but will be materializing in this quarter. But the same time we do not consider in our forecast. Because the thing is that we have to concentrate upon the cases which are. In DIT or maybe the surface actions. And taking even the smaller loans are. There where you recovery agents you deploy and take the position of the cars or maybe the house and then you try to put into auctions and all.
Actually we have strengthened those systems. And that is why we are confident that this portion of the recovery you. Will see better than expected. And that related to the better ones we are still. We still have there. I think that will be going forward as well for maybe few quarters and years.
Operator
Thank you Mr. Sonjay. Please rejoin the queue for more questions. Next question comes on the line of Gaurav Jani with Prabhudas Diladar. Please go ahead.
Ajay Bansal
Yeah, thank you for taking my question and congratulations. Just, you know, firstly on the LDR side, while we have had liquidity benefit due to the CRR cuts, LDR is kind of shot up by about four and a half percent sequentially. So you know, what kind of LDR levels are we looking at sustainably? Given the fact that capital we are pretty comfortable at about 14 to 15%. So yeah, that’s the first question.
Asish pandey
Yeah, see there are two types of ldr. One is domestic and another one is. You know, as a global consolidated typically. Let us discuss first three. The domestic one compared to the. Compared to the domestic one, we are. In the range below 81. And if you see the banks today and the efficiency parameter wise, I think. 80, 81 is a very good comfortable range for everybody, all the stakeholders. So absolutely that is not an we have achieved it. The second one is, you know, compared to. Because before and you will be knowing.
That including the GCC generally you will see more PCB ratios with them ldr. So then that is the reason it is globally if you see it is. From there 82, 83 range. But otherwise we are in a comfortable range. We do not foresee any issue in. That that gives a good efficiency with that range subject to that, you know. You deploy the assets qualitatively and quantitatively. In the right direction. So I think that we do not want to go beyond certain limit. Maybe 0.5 to 0.75% here and there.
Ajay Bansal
Okay, understood. Thank you so much. Secondly, on the OPEC side, right. I mean last two years OPEX growth has been kind of, you know, low. So for the next two financial years, what kind of an OPEX growth do we effectively should it be in tandem with the loan growth?
Asish pandey
Yeah, actually we have taken few steps here. That is actually we cannot say much. But then probably you will be seeing the like, you know, one is the Project Muskan itself where we are moving. Towards the efficiency point number one. Point number two, there are a few more which we have taken on the ATMs and similar, some sort of an. Equipment and other things where we see. That certainly because when you are in a economy where GDP is doing everything. So the cost of your, the cost of your people, cost of your physical infrastructure increases.
But then what we are looking at it is actually we have identified and identifying further that what are the parameters. Where we can have a control. So specifically those parameters the entire team is working upon. But going forward on an operational expenditure, you know, once we move towards more of a like our Ed Srinite was. Telling you on the digital push and the digital infrastructure platform which the bank. Has built once it is put to use to a good capacity, I would. Even not say 90 to 100% but even if it is put to safety to 70% you will see good cost cutting along with the risk mitigation.
So I think probably, you know, and we do have a plan now I will come back to one more point because being an investor you will have. A noting of it. So we have a plan of opening. Some 75 branches this year itself and going forward we want to further open 200 branches. So that is also a cost. But then we would like, even then. We would like to, we would like to come down and bring it into the control.
Operator
Thank you Mr. Jani. Please rejoin the queue for more questions. The last question comes from the line of Siddharth Rajpurohit with systematic scope. Please go ahead.
Unidentified Participant
Yeah, congratulations for the team to the. Team for a good quarter and thank you for the opportunity. I have two questions. One is what is our excess standard asset provision that we hold and second is this, this Project Finance provision rules have taken. So how do you see that impacting the provisions and do you, are you seeing an incremental increase in the private capex that is coming out or when do you see it will pick up?
Ajay Bansal
So okay, so I’ll take the first. One which is on the excess standardized provisioning. So you know, I don’t think it’s fair to look at it from a point of an excess standardized provision because what you’re trying to do is bridge the gap between ECL and you know, the current level of provisioning. So that is something that you know, even in the, you know, the last couple of quarters we’ve been saying that we will make standard access provisioning and you know, giving you the extra standard assets provisioning would also give you an indication of what could be the potential ECL related provision so which we’ve not directly put in the public domain.
So we are comfortable in terms of. The excess in terms of the standard access provisioning that we hold and we. Will continue to look at it, you. Know, as and when the RBI releases the final ACL guidelines to see, you know, whether we need to increase or whether we need to to you know, maintain at the same level.
Unidentified Participant
Second, on the Project Finance thing.
Asish pandey
Project. Finance. I don’t think we’re expecting much. Of any but
Ajay Bansal
Not, not much. So in Project Finance there is not much provision has been made in, during this quarter. So of course there are some Project Finance where you know recently we have done it so accordingly the provisions have been made as per the norms. But that is not making a much of a provision on the provision side.
Asish pandey
In fact you are trying to understand that what is the impact of this in this new project finance guideline and proving so for existing portfolio there won’t be any impact because there even COD has been achieved or COD and will extend it for only new cases where COD is getting extended this will have some impact. So this will have incremental impact on it. Not so that will keep on moving based on new project which comes to us in our portfolio and then there’s extension required to significant.
Unidentified Participant
Yeah. Thank you. All the best to the team.
Asish pandey
Thank you so thank you so much. To all our investors and list and. We are always thankful to you for being along with us and we always appreciate you know whenever you tell some lackings from our side and something where we have to improve. So we always welcome those suggestions from you and you have all our mail. IDs and everything and. And certainly we can have a meeting as well. But then as a from the Union bank and we all senior management sitting. Here we welcome those and anywhere we would like to take further improvements because you will have some critical eye to.
Make the analysis of the bank and tell us where we can a bit more improve upon. We are in that process but certainly we value your submission. We value your proposition and thanks to you for along with us today. Thank you so much.
Operator
Thank you on behalf of Union bank of India. That concludes this conference. Thank you for joining us. You may now disconnect your lines.