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) Q4 2026 Earnings Call dated Apr. 23, 2026
Corporate Participants:
Ajay Bansal — Deputy General Manager
Asheesh Pandey — Managing Director and Chief Executive Officer
Analysts:
Ashok Ajmera — Analyst
Mahrukh Adajania — Analyst
Unidentified Participant
Ashlesh Sonje — Analyst
Unidentified Participant
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Union bank of India earnings conference call for the period ended March 31, 2026. The bank is represented by the Managing Director and CEO Sri Ashish Pandey. Executive Directors Sri Nitesh Ranjan Sri Rama Subramanian Sri San J. Rudra Sri Amrish Prasad and other members of the 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 during the conference call, please signal an operator by pressing Star zero on your touchstone form.
Please note that this conference is being recorded. I now hand the conference over to Mr. Ajay Panchal, Deputy General Manager. Thank you. And over to you, Mr. Panchal.
Ajay Bansal — Deputy General Manager
Thanks sir. Good afternoon ladies and gentlemen. I, Ajay Bansal, Head of Investor Relations welcome you all for Union bank of India earning con call for the period ended March 31, 2026. The structure of the phone call 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 call, I will read out the usual disclaimer statement. I would like to submit that certain statements that may be discussed during the
Asheesh Pandey — Managing Director and Chief Executive Officer
Investor interaction may be forward looking statements based on the current expectations. These statements involve a number of risks, uncertainty and other factors that cause the actual result to differ from the statement. Investors are therefore requested to check this information 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. So thank you so much Mr. Benson and good afternoon and welcome to all the investors and to this NVIST call.
NVIST meeting and we had audit committee and the board and results are adopted by the board and we had a press meeting and just now from press meeting we have switched to analyst meeting. Now as you know the current scenario which was from January February onwards. So macroeconomic environment has been influenced by ongoing global conflict and war related disruptions and other things. But at the same time the Government of India RBI has come forward to put up a cushion so that the impact is not much of that.
So we have seen various majors the RBI has come and also various majors the Government of India has come and which has well taken in the market. Now similarly if we come to Union bank of India. So all of you are aware that initially in the last September when we had a con call in 28th or 29th of October and 13th January we had for December quarter and I think the third time we are meeting right now. So from there we have moved a lot. We also placed our provisional numbers on 3rd of April to the stock exchanges.
So initially yes we had a muted not too many questions were also there from our analysts and press and investors that on the growth side so Certainly this last six months we have made a good steed on the business front. Whether it is a casa, whether it is even a deposit or a return term deposit I should say or maybe advances on all retail and MSME and the large corporate. And if you see the business of last six months it has increased by 1 71,000 crore. So the growth was around 5 point. Sorry say around 6.56.
If you analyze it comes about 25%. Sorry it is about 13, 13%. So we could make it. And even our strategy was very clearly that we wanted to be more on a casa. So yes, CASA is increased. You can see around. If you see half and half year basis it is around 2.7 percentage which has been increased. And the second one is that when we talked about the retail term deposit because we were purposefully shifting from bulk deposit to retail term deposit. So put together it is 1 10,000 crore we could garner.
And here if you see on the growth the figures which we will be giving to you the global deposits certainly you may feel around 2.72%. But then around 46,000 crore we raised alternatively in which 25,000 odd amount which came. We shrink the treasury book so that we move to lending book number one number two number on the refinance and other things around 18,000, 3,000 infrastructure bond. So if we add that 46,000 with the actual increase in the deposit. So I believe there it gives 1.29 actually lakh crore which is almost above 9%.
So that is not. But the thing is that we are very cautious about our cost. We are cautious about the mean. We are about very clearly about profitability. And that is why we are working on the efficiency parameter. So you may see that we are above 80 CD ratio much comfortable. LCR114 much comfortable. And NSS are also much comfortable. So all maintaining all regulatory and the liquidity and other guidelines. We are on the good footing now of this six months. We could have a very good increase in business.
So if quarter to. Sorry, quarter to quarter only if you take. It is 6.52. If you take the global business then certainly in totality putting together asset and liability side it is into four if you analyze coming around 13%. So I think we could make it the headway in the last six months. So with this background we will come to the figures. And first of all the board of directors have recommended a dividend of rupees 5 per equity share 50% of the face value for year ended 312026 subject to the Requisite approvals.
Net profit of the bank stood at 18,697 crores. And interest incomes of the bank stood at 1,5009 approximately 1.06 lakh crore. The business growth is around 5.78 yui wherein gross advances increased by 9.74. And total deposit grew by 2.72% yui which for which I have already told if we take 46,000 the additional one which we have raised alternatively then the the total business grew by 23.85 lakh crore. So with this the RAM segment which we were focusing it is 12.56 yui in which 16.75 growth in retail 18.75 in MSME and the domestic advances ram advances is 57.49%.
The gross NP has reduced by 78bps on yui basis to 2.82. And net NPA reduced by 15 bids on yoy to 0.48. The strong capital ratios, the capital adequacy CRA stood at 18.10 increased from the earlier one. And the CT1 ratio which is important its own money is improved from 14.98 to 15.69. And if we take the return on asset and the return on equity. So return on asset is Y O y is flat 1.25. It’s the same almost levels. But if you take the quarterly, the last quarter we were at 1.35. This quarter we are at 1.36.
And one more highlight which I would like to give to you that this time apart from this we have kept 700 crores of an additional provision. General provisions are top just. You know, as a. As a. When good time is there it is always better to keep aside. But this 700 crore is not impacting either the net profit or it is impacting the impacting the capital. So this we have kept and depending upon the situation whether ECL framework comes or whether. Or whether West Asia or anything any eventual thing.
So we hadn’t last time our profit was 5,017 crores. And now it is better, much better than that. And secondly the dividend also last time it was 4.75. This time it is 5%. And if we take the payout ratio it is 20.61 or 6.5 levels. So I think we have maintained all. And with this I hand over to the coordinator for the Q and A for all of us. Thank you.
Questions and Answers:
Operator
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your Touch tone 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. The first question comes from the line of CA Dr. Ashok Ajmera, chairman from Ajkan Global. Please go ahead.
Ajay Bansal
Yeah. Thank you for giving me the opportunity. First congratulations Pandita and the entire team. Ashish sir, for a very good quarter because or rather I would say the last six months have been good for the bank comparatively as compared to the previous four quarter before that and at least to. To a great extent we have covered as far as the credit growth is concerned 6.07% only in one quarter and 9.74% for the whole year. Respectable figure. Having said that sir, but on the deposit front even though in this quarter we have performed very well 6.87% but the overall for the year the deposit is 2.72%.
So now the going forward in order to though presently we are good at CRAR but going forward with the kind of the growth. I would like to know the credit growth target also as well as how are we going to match the asset liability if our deposit growth do not match with the credit growth. Sir, going forward.
Asheesh Pandey
Okay, so thank you Ajmera sir, as I said this time also if you see the 46,000 which actually see. Let us understand banking that we raise resources and we deploy resources to productive investments and we invest it whether in the treasury or in the loan book. And then we earnest the interest income and the fee based income related to the transactions happening now coming to that if you see we have reached 46,000 crores. So and that in which the treasury this is I’m saying not raised but a risk sources which we have tried to build.
So our treasury book was reduced by 25,000 crore or which we shifted. So if you see the last year the March 25th levels at that point of time the CD ratio was around 77 and now it is around 3.5% up. Now the question is that whether the CD ratio we are very very comfortable. Comfortable comfortable in a sense very nicely regulatory but at the same time very efficient above 80 level. Number one. Number two is that our LCR NSFCR on liquidity ratios are very comfortable range. Comfortable in the sense again very efficient because last time our LCR was average 123 but this time it is around 114.
So we could reduce by 10 basis basis point on the NCR which was on the excess side. So I think that this what was the challenge not the total Deposit. But the challenges on the CASA front and on the retail term deposit. Now if you see these two figures as far as Union bank is concerned we have made a very good stride in that. Now put together second more than 1 lakh 10,000 crore which we have increased during this period. Now the CASA which was because see again if you see yoy then Certainly at the March 25 level it was more.
In September it was only 32.51. From 32.51 we have come up to 35.21. So 32.51 to 35.21. So there is increase of 2.7 percentage points. I am not saying basis point. So that is the first key thing which is very clear from the working which has been done by the entire team of Union bank that we have tried and focused a lot on the CASA and we could achieve that. That is point number one. Second is we were very cautious to increase our retail term deposit because that is the stable point number one. Point number two, it has an LCR impact also.
And that is the reason during the entire year now if you see our bulk deposit we have shared off by 70,000 crore. So that is a very clear thing. Why how we want to churn. So basically exactly what we are doing is just churning a portfolio towards a better one. And if you take the cost, so if I take this 70,000 then certainly I can say that they must be having the weighted average above 7. But when we talk of, you know, converting this to retail term deposit in CASA my average cost would be somewhere 4.5 or maybe 4.75 levels.
So where. And again now I am just linking this with the February somewhere 25 where from there and up till now the repo has been reduced by 1.25 percentage points. But if you see the mean of our bank which was 2.91 has right now at 2.70. That is only 21bps point. So I think this is the only thing which is helping us. So you know, and we always say that we want to defend our name. We want to defend. We continued saying that and that is what we tried. But then I think the last moment when there was increase in the GSAC yield and there was increase in the deposits as well.
And that was the reason. But then from here onwards and if you see the last cut which has happened in December, the entire 50 basis point was conveyed for the entire quarter. But then also if you see the NIM from 2.76264 it is only 12 basis point so this is the reason you know that cautiously we worked upon each parameter of the balance sheet, each parameter of our asset and liability. And even on the credit side though you are saying 9% good. But then there is one thing which is not coming forth is on the large corporate we have 30, 35,000 crore of IBPC which is 0 now number one, number two is around 30,000 crore we had on which is at below 6% levels which is almost is not there now somewhere it has churned up with the new business when we had it has gone out somebody new business has come.
Now if you add that so the team has worked and team has worked well and actually if you see this figure we have worked better than the industry average. But yes the figure is figure. If you see the year on year basis certainly you see somewhere this deep. But then we are working upon the average whether it is casa, whether it is deposit, whether it is advances, whether it is ram. Now that’s the reason our profitability has continued towards an upward trend and that’s the reason reason that even recovery we are trying hard to improve.
And that’s the reason that we are having the profit of more than 5300 crores. And even then we have kept 700 crore aside for you know anything contingency or anything. It is not like like you know any, any, any dent or any suspicion on the book. We have already given in our presentation that our more than 95% 99 I think is more than 700 CV scoring retail and other portfolio and more than 95% in BBB and above. So I think that gives a color of the business also last six months which we have done. So I think this is this background.
I could, I think I could answer that. Going forward you can expect the industry to trend. We will be meeting it and we would like to be better than a bit more than that going forward in the coming years.
Ajay Bansal
Can we, can we expect it 1314 growth in the credit sir in the FY27?
Asheesh Pandey
Yeah, certainly I think we are, we are on that line. Yes
Ajay Bansal
Sir. Now coming to the profit and loss account. I mean our profitability you have clarified that the profitability would have been much higher but for the 700 other standard provision which we have done which according to you is just to take care of any provisions or ECL or other things and nothing is to take care of any known known account or so that is good point well taken sir. Our one other region of the profit being little high is there is a reduction in the employee Cost in this quarter of by about.
Almost about 600 crore. So the employee cost reducing in this quarter which is also actually a March quarter what would be the region and going forward are we going to maintain that 3700800 per quarter or it is going to be lower in the coming year. So that because you know 586 crore our wage bill is employee cost is lower in this quarter. This along with another point is that the operating expenses have gone up in this quarter by 522 crores. So offsetting each other to some extent. And another point is that income going up is there is a handsome recovery from the return of account.
Very good recovery of 1,567 crore as against 667 crore in the last quarter. So can we have the individual explanation or some details on these 34 numbers on the profit and loss account so that to have a clear idea for going forward where do we stand?
Asheesh Pandey
As you observe there is a
Ajay Bansal
Reduction in my operating expenditure particularly establishment expenditure. So this is due to the discounting rate Factors. Last year 31 March 2025 discounting rate was 7.07 and this year it was 7.87. So due to that the overall liability we estimated earlier was provided higher in the earlier quarter. And due to that the final liability which was on a lower side. So this was the impact of establishment expenditure. Now as far as the TW recovery which is close to 1600 in the quarter as compared to 666 crore in the last quarter.
We have that Sterling Biotech Group accounts which were settled during this quarter and the income of 658 crore was booked during this particular quarter. So these two factors and what was the third one? Sir, you asked employee cost has reduced and operating expenses have increased.
Asheesh Pandey
Other
Ajay Bansal
Operating expenses have increased. Yeah,
Asheesh Pandey
In Q4 this trend is always there sir. Operating expenditure, the budget which was allocated and the provisions which are made in the year end is always there is a gap of 200300 crore. It is always there in Q4. Sir, this is a normal trend. If you look at the quarter wide.
Ajay Bansal
All right, there is a little. Now looking at the current geopolitical situation and the West Asia water situation. Pandya, how do you see? I mean is there any stress again already started building up or in this first quarter do you feel that there will be some stress? Because even in this quarter also the fresh slippages have increased to 2023 as against 1660 in the last quarter. And secondly even though SMA2 numbers have come down. But SMA1 numbers have almost doubled. So do you see that any, any kind of this abrasion, I mean this war effect may be there in this coming quarter or the running quarter.
Asheesh Pandey
Sir, we actually you know we are very closely monitoring the entire West Asia crisis. This all these things and as such we have not seen anything very unusual up till now. And we are also monitoring what is the inward remittances flow last year and this year we are also monitoring import numbers and remittances total remittances, import remittances. We are also monitoring where it is hedged, not has and other things. So what we have seen is that there are two things, two, three things are impacted.
Like one is the energy sensitive sectors where gas, commercial gas and all. So those particularly industries they suffered a bit like mobi and all. And a few more places are there which were actually based upon the energy these energy sectors. The second one is that remittance overall also has come down. But up till now we have not seen anything. And at the same time when this all these things happening the Let me share with you. The government of India and there is a bank both have come forward and tried to put a cushion with the initiatives which they have taken.
Now we are in that and even let me share with you. We have a data also which I can part with you. On the scheme portal we got around 306 this I am saying that status of CGSE application that is credit guarantee scheme for exporters to provide 100 credit guarantee coverage. In that 210 are sanctioned and 180 is disbursed around 700 crores. And on the other side where you know the RV also came with the trade relief measures. Extension of PC extension of post shipment and conversion of accurate interest.
So we have received only 5. Sorry applied 59 people only applied 35 applications in PC extension post shipment only 3 and FITL which is only 40. So we have not seen anything. So the memory figures what we are observing that as of now is not you know giving any very adverse or very critical signals to us.
Operator
For more questions.
Asheesh Pandey
Yeah, coming to SMA actually from SMA we have moved a lot portfolio to SMA one. So I think it is a better Signal that from SMA2 we have moved to quite a lot by recovering the installment. And we have moved to a better proposition of the stage two like you know one I think with this 60 to 30 to 60 days. So it is a better proposition. And over to you.
Ashok Ajmera
Yes
Ajay Bansal
Sir. Thank
Asheesh Pandey
You very much.
Operator
Next question comes to the line of Maruk Alijania with Tara Capital. Please go ahead.
Mahrukh Adajania
Hello, good afternoon sir. So I had a couple of questions. Firstly there are corporate loans have grown 9% QoQ. And then if you see the sector corporate, the certificate of deposit beta which is available for all banks then our CD mobilization was also very high compared to other banks during the quarter. And our LCR is now amongst the lowest and margins have also fallen more than what we had guided for. So what would be the strategy going ahead? Would you continue to pursue corporate growth even if it’s low yielding?
What about deposit makes? And given where LCR is, would you rather focus on margins or would you from now on focus on growth? If you have to choose one of the two.
Asheesh Pandey
See we are choosing growth with quality number one and with profitability. Now I think in my initial address and I think when Mr. Ajmera was asking I have made made it very clear that though you cannot see those growth in these numbers but 35,000 crore of IBPC at a very lower rate which we have, you know, shed IT off number one then around 30,000 crores, almost 60,000 crore, 65,000 crore of such advances which were low yielding. Otherwise how we would have shielded the entire NIM which was 2.91 to 2.70 which is only 21 basis point reduction is there.
It would not have been possible if in case what you are saying it would have been correct. So we have actually tried now coming to the cd. The CD is almost in the same range which we had the earlier years. So you have seen like you know the CDs which are raised but then there were maturities also. So which has to be replaced. So for a bank we have an internal sort of a ceiling limit where we keep you know, CDs NFDS and other things in the same fashion. So that is the reason we have gone with the CDs.
So we have gone within that range and that was actually we were getting a better rate during those days, you know, otherwise actually if you see we have mocked up most of the our requirement during the January, February onwards. Not much in the March and there we could get otherwise March was really heated up market if you take the deposit rate or CD rate. So that is why we are very cautious about the nim, about the profitability and about the quality of the asset. And like going forward we would like to maintain our, you know the maybe around 13 to 14% credit growth and around 10 to 11% off.
And also one thing, when you ask about. We have raised in between. I am sure you must be aware around 3000 crore of infra bound in between. And that is also it is a part and parcel. And actually the subscription was very huge. But then we were cost conscious. So we have not gone beyond a certain acceptable range. And we have cost of at 3,000 only. So probably in the coming year once everything stabilizes, what we will be finalizing internally going to the board and AGM and other things. And then we will be coming up with the entire capital and bond issuance and the plan with the market.
So I think it was like, you know growth certainly would like to grow industry plus something. Number one, profitability. When in last year six months. Sorry quality. You will see that we are continuing the same quality of the. Whether corporate book or a retail book which we have given in our Investor presentation on 700 and above. Though the Bureau says 680 and above is the prime customer. But we have continued with 7700 and above and the triple view and above also we have given the figures. So we are continuing that we also have around 50 to 60,000 of a book pipeline with the US in the large corporate.
So I think with that we are sure of going forward. But then we will not be compromising on the quality and also on the profitability.
Mahrukh Adajania
Got it. So any margin outlook you would have for Q1 and for the full year.
Asheesh Pandey
Yeah. See now we have seen the last MPC also and these stance has been continued in the in the same levels. Now keeping in view the macroeconomic scenario and the stance which has taken if we continue like this. So last I think in December Midway somewhere this 0.25 cut was there. So which has if you see has not been reflecting in our figures though around the 53, 58% is based on the T bill and the repo rate benchmark. But even then if you see the mean it has been quarter to quarter ends in it has been from 2.76 to 6.4 only 12 basis point not the entire.
So I think there from here keeping in view the same thing. We expect that we will be maybe moving positive from here and will be defending this point of level.
Mahrukh Adajania
Okay, so you will be able to maintain margins at 2.64.
Asheesh Pandey
Yeah, we would like to even better it.
Mahrukh Adajania
Okay. And that would be driven by. Sir.
Asheesh Pandey
See if you see very clearly that in the last quarter also we CASA is increased from from 32.51% which was our CASA percentage in the month of September and which have increased to 35.21 as of March. So certainly when you shift bulk deposits to the CASA and you shift your bulk deposit to retail term deposit and you can see the growth in both the factors, both the parameters. So certainly it will help you to build on the positive side on the name and then not only this but there are other factors also.
You know when you better talk, negotiate, discuss and you make a relationship management the quality of asset you write. So those things also help you and what we have underwritten the quality is there but certainly the weight and other things which we were charging I think that is also helped us. So going forward we will be banking upon this and the deployments of funds in most most effectively. I think that is the main thing which you would like to tell.
Mahrukh Adajania
Got it sir. That’s very useful. And also if you could explain the increase in MSME slippage in the fourth quarter and if that’s just a one off and nothing and you know how it will pan out in the next few few quarters.
Asheesh Pandey
So I think if MSME you see the almost it is sort of a flat only I think from two four to four to something levels. I think some 10, 15 bits only. So it is almost a flat. But then there were like you know the few cases only which has impact otherwise. Up till now whether it is a best year or in general our book we have not seen any much of the impact on our book and quality. So going forward we actually we would like to reduce you know with the recoveries which are already NPA in either of these four sectors sectoral which you have asked.
And that is why we have built a very team even now centralized that even below 1 crore sort of in portfolio we will be monitoring from the central office level. So I think the core recovery I would talk about we will be trying to improve it much ahead much further from here onwards.
Mahrukh Adajania
Okay sir, thank you very much. All the very best.
Operator
Thank you. A reminder to all the participants. Please restrict yourself to two questions. Next question comes from the line of CH Mundra with ICICI Securities. Please go ahead.
Ashok Ajmera
Hi, good afternoon sir and thanks for the opportunity. Sir, my question is also broadly similar. I heard you that you said that you know we’ll focus more on growth along with quality and profitability. The profitability focus is clear and we have defended elevated roa. So that is well appreciated. But what I wanted to know is when you assume Charge Union bank was one of the few banks which was you know not too much concerned on the loan growth but they were depend. They were defending name or consolidating liability franchise and hence NII was growth was very minuscule because you were not growing as much.
Also then you put a shift in the loan growth trajectory. But still the NII growth is similar. Third quarter was a good quarter in the sense that NII increased 5, 6% QoQ. But this quarter again while the growth has been 6% but NII growth has been flat. So is there any thought out strategy or this is just market force driven that you will keep going on the loan growth on quality and the NII outcomes will be dependent on. On the. On the. On the market competitiveness or you have some visibility on the NIA growth.
Also. Thank you. That is the first question.
Asheesh Pandey
Yeah, actually we would like to. So what has happened? No, around 25 basis point there was a. There was a cut in the. I think in the midway of the December which has conveyed to conveyed along the entire benchmark rate link loans. So that is what you have seen a bit dip on the on from 2.76 to 64 on a quarter to quarter basis. And that is where you can. You are seeing flat. But then we are doing two, three things. One is the. We work upon the average advances and average figures on both asset and liability side.
And that’s the reason we are inching towards that it has to be better than the earlier ones. So I think there we are thinking that how to build the. The NNI growth also and also to keep the quality and as well as the profitability intact. So it is not like you know that we are maybe writing underwriting maybe good quality, but maybe underwriting. Underwriting a very, you know, no margin loans. Or maybe the second one. If I would say that we are underwriting a bit lesser one and then charging more.
No, that’s why I said that the growth. Yes, that is the first key thing. But at the same time profitability and the quality we would like to maintain and grow in this way. But then going forward we would like to have. Because as of now everything is settled. Like till you know we have a further scenario on inflation and further scenario on rate cut and other things. So from here again you would like to defend and move it better that you will be seeing in further quarters.
Ashok Ajmera
Okay, sure. And sir, you have given a decent disclosure on the bulk deposit, right? So on in the December quarter or in the March quarter there was a lot of. There was sharp spike in the bulk deposit rates. Could you quantify sir, what was your blended bulk deposit rate? A ballpark number will also do. And has that started to come off in a significant way.
Asheesh Pandey
Yeah. See if you see the. You know like. You know what I mean when we test upon the last quarter. So then I said that we have shrunk by. I think I told around 15 or so and now you see it is 25,000 crore. So what happens now that you start trying to. Trying to reallocate the portfolio. So it is shifting from one to another and in between the portfolio also you try to build in from low to better yielding portfolio like IBPC which we have shared off and other things. So what we did that. That certainly when you are having good growth in the advancement side.
So certainly you need to raise deposits. So we raised in between 3,000 crore in flabold and the other things which I shared with you along with that we needed deposits so that you know we are a comfortable range a good range on the. On the NCR and NSFAR NCD ratio. So that was the key thing in mind. And that is why most of the deposits deposit we raised during the January itself. And so that we knew that probably going forward in the month of March probably nobody was aware that how it will behave market will behave best Asia crisis how it will deepen and not deepen and the other issues.
But then you can tell, you can tell the blended. So on a bulk side the blended rate for the quarter was a little less
Ajay Bansal
Than seven. Around 690 or so.
Asheesh Pandey
So around seven we can say.
Ashok Ajmera
And that has come down significantly sir as we speak.
Ajay Bansal
So it’s all depend upon the market currently the April month there are not lot of activities happening in the market on the CD front as such. So current level are little lower than the March that is there.
Ashok Ajmera
Okay. So sir, the reason why I was asking was this. If I tally let’s say a bulk deposit rate on an average at 690 our yield on advances is 7.98 which is the total. The corporate would be even lesser. Right. So does it make sense to to do this corporate lending when we have to raise bulk at 690 and maybe lend at 750, 720, 730. I don’t know which whatever the lower than 7.98 number because that increases absolute amount of NII but depresses the margin. So that is the question.
Asheesh Pandey
Yeah, I think I would give you a very good. You know the scenario. Not scenario, the actual scenario. See you are thinking that the entire which is raised at 6.90. Since you asked what is your blended rate on the bulk deposit. You asked only the bulk Deposit So we have told only on the bulk deposit, not the entire. Now there is a CASA and a CASA and the written term deposit increase is around huge. I think more than 1 lakh 10,000 crore. And then if you see the blended cost to me on that must be around 4.7 levels.
So this is. I’m seeing incremental. I am not saying it is a total. Now there is a total huge portfolio. So my. My CASA itself Is stands around 35.21. Now if you add retail term deposit how much percentage basis of the total deposit? 79%. So my RTD and CASA is around 79%. So certainly I save the cost there. But to maintain the growth and maintain everything it has to be blended with the maybe fixed deposit and maybe sometimes in that there will be different scenarios. There may be between 3 to 10 crore.
Because retail term deposit we say only below RBI guidelines of below 3 crore. But then 10 to 15. Now there will be various deposits JG where you know which are LC margin, BG margin and all those for three months, nine months, 10 months period one year period which may be at 550 and around 6%. So I think the how you correlate to the mean is on the total portfolio. And that is what I just wanted to put forward that this particular quarter which we took from 1st of January to this. This is somewhere coming the blended rate.
But the deposit which we have shared off around 70,000. Then again it was a different rate but the March particular piece which we have to have the maturity was around 7.70 levels as a blended rate.
Ashok Ajmera
Right? Understood sir. And if you can share sir the few data points if you can help with the loan mix by benchmark EBLR, MCLR, T bill and AFS reserves. And how much is the change versus last quarter
Asheesh Pandey
Which reserves?
Ashok Ajmera
AFS reserves.
Asheesh Pandey
So I think 58% is. That is you
Ajay Bansal
Can tell. No,
Unidentified Participant
You don’t give. Right now
Ajay Bansal
54% is my external benchmark link portfolio, sir.
Ashok Ajmera
Enter T Bill and MCLR is how much? 36%
Ajay Bansal
Is MCLR.
Ashok Ajmera
Okay. AFS reserves movement.
Asheesh Pandey
What is the ACS result? Ifr. Can you clarify what exactly you want? Sir,
Ashok Ajmera
Under this new investment classification the MTM hit on AFS has to be.
Asheesh Pandey
Yeah, Mr. Cara, he will. Yeah. Yes. So from December it was around 800 or so increase in FS reserve in this quarter.
Ashok Ajmera
So you have seen an accretion sir, is it?
Asheesh Pandey
No, no, it’s a. It’s a negative figure, sir.
Ashok Ajmera
Right. All right sir, I have few questions if you want to ask them. Yeah. Yeah. Understood.
Asheesh Pandey
It is reduction of 800 crores. Correct? Yes.
Ashok Ajmera
And how much is the outstanding amount now? Sir, is in the balance.
Asheesh Pandey
Outstanding is negative 1 008. Okay.
Ashok Ajmera
Sir, I have few question. If you want I can ask them now or I can come back in the. You can send us. I wanted to check this LCR new guidelines. Have you calculated the new LCR under the new guidelines as in what would be your lcr? Let’s say first April or you know what is your sense of. We
Asheesh Pandey
Have. We have calculated and the negative income impact is from around 14,000 crore. And positive impact is around 21,000 crore. So 7,000 cr is a positive impact. Okay.
Ashok Ajmera
This would mean
Asheesh Pandey
Much.
Operator
Sir. Mr. Mandra, sorry for interrupting. Please rejoin the queue for more questions. Thank you. Next question comes from the line of Param Subramanian with Investech. Please go ahead.
Ajay Bansal
Yeah. Hi sir. Thanks for taking my question. Firstly I wanted to ask just to clarify once again on nim Is there any one off or seasonality or any such thing in the margin quarter on quarter or you are just saying it is mainly the mix. And the December rate cut.
Asheesh Pandey
It is basically December rate cut
Ajay Bansal
Is
Asheesh Pandey
Much lesser than the rate cut.
Ajay Bansal
Okay. Okay. So one thing I can see is the interest on reserve bank of India balances that is down. That is mainly the decline in lcr. Is it just clarifying on that number. So that number is down 500 plus crore on a Y basis. You’re interesting but
Asheesh Pandey
I think I am not very sure on that.
Ajay Bansal
Okay, I’ll take that offline. And there is no impact of the RBI NOP circular at all for you either on interest or other.
Asheesh Pandey
Actually we had kept ourselves very cautious during this disruptive time. So we were not taking long range calls. So our exposure was only 30 million. So we were much below 100 million. What set circular was
Ajay Bansal
Okay. Perfect. Okay, sir. And then on the PSLC and also your credit card since you. I’m just coming to questions together. So on the pslc. See this year has been soft PSLT fee income. But you used to accrue close to thousand crore, right? On an annualized basis. Should we get back to that run rate next year?
Asheesh Pandey
So see like last time actually we had a complete period of that. That is why the amount. So 800 plus crores this time. We started PSRC in the month of Q3. So we could book I think 12080 crores something like that.
Ajay Bansal
And
Asheesh Pandey
This then this quarter it was very hardly any period left for 31st of March. So we already booked this time also. But then the. The. The total amount was less. So that is the reason because number of days that functionality is there. So there’s a reason. But then we would like to continue on that.
Ajay Bansal
So we should be able to do thousand crore plus which was your number say last year.
Asheesh Pandey
Right now, right now it is not. We will assess it because you know the entire portfolio has to be seen on SMS and other things. And then we will take a call. But yes, you know like to deploy in this year.
Ajay Bansal
Okay sir. Perfect. And lastly on credit cost I think very good numbers there. So 23 basis points for the year. Do you think it is sustainable?
Asheesh Pandey
So right now coming to the credit cost we are not seeing anything very adverse on because of this situations. But if you see the credit quality the SMEs same level as 3800 level SMA 1 and 2 of the entire portfolio. And also if you see 25 crore and above almost more than 95% is the BBB above. And if you see the prime customer which has taken 680 but we taken 700mm of civil score Transunion and other bureau score which is around 99%. So I think the quality wise like you know this score matrix and the other way it is the quality is in front of you.
So we are not seeing anything, you know go right. But then we always say for comfortably because we don’t go aggressive. It is better to. Better to you know get the better figures. But then we say around 1%. We keep as a. As a. In general guidance for the year.
Ajay Bansal
Okay. And the 700 crore has nothing to do with any pressure. You are seeing that you have made this nothing. It is primarily for ECL transition. Yeah, maybe.
Asheesh Pandey
See always you know the regulator and everybody says that in good times you if you have money to you keep aside and save it. So simply we have kept aside not in profit, not in capital and see it may not be used for years together. Absolutely. So but then it is kept as a question. It is kept because we do have. Because other than that also our net profit is in comfortable range and we are giving dividend of 5%. That is 5 rupees per share. 50. Then I think that is the reason we have kept it aside for a better.
You know strengthening the balance sheet.
Ajay Bansal
Perfect sir. Thank you so much and congrats on the quarter. Thank you.
Operator
Thank you. A reminder to all the participants. Please restrict yourself to two questions. Next question comes from the line of JN Karate with Access Capital. Please go by.
Ashlesh Sonje
Thank you for the Opportunity. Sir, just one question. What level of LCR are you comfortable with? If it falls below 110 are you okay to operate at that level?
Asheesh Pandey
See actually what happens through like the the reserve bank guidelines is of hundred and then board fixed guidelines are there for each and every bank. For us also there is a board fixed trigger. Board fixed first is trigger and then the breach. So but as a see there are like two things which are we would not like to breach these two figures. So we are above that 7 8% levels and we actually on a rolling basis we calculate for next one or two months and then we take the deposits and raise the raise the resources accordingly.
So how much would the 7,000 crore add to the. 7,000 crore add to LC and I think 2, 3%. How much? 2,200 crores. So around 3%. It works out for an LCR for our bank.
Ashok Ajmera
So which means that the pace which you’re consuming if you are not to able able to match deposit growth in a quarter or two you’ll have to slow down on loan growth.
Asheesh Pandey
No there is no question of not not matching the deposit growth. See what happens now Suppose if you have a money in your pocket why you will go to ATM and withdraw further you will first use what you have in your wallet and what you have in your pocket. So the same thing we did that is what actually since beginning we are sharing with all the all the press and this that we see. I will give you only four figures. My the March 25th CD ratio was around 77. Now we are at 80.5 or some level. So it means 3.5 up number one and number two is that that our NC LCR requirement was a bit more earlier because we have actually seen each of the items and then we could move from LCR the items like you know financial institution runoff factor was straight away 100%.
So that we have moved from financial to non financial even if we have taken the bulk deposit. So that has reduced our LCR that has moved to no loan side. Now the third comes the treasury we had. Now you can see in our presentation also non SLR portfolio has reduced so certainly we have moved on a better opportunity on the loan growth. This is the third point. Fourth point is then again you have a infrastructure bond and other avenues we have raised 3000 crore. Then again we have avenues of refinance wherever possible whether in our portfolio.
So the thing is that suppose now with this 2.67 growth there is no breach in NCR. There is no breach in NSS and then my CD ratio is very good. Now suppose listening to on if we increase by 5% basis point and we take 50,000 crore where it will go, it will straight away impact my my CD ratio to 74%, 75%. So the question is very very simple that when need be, take it when need not be. So I think no need to. But now again you see in the third quarter we have not taken. We have shed off much more. But in fourth quarter we needed because of the growth happening in credit side though we have taken 3000 crore in Sabol because the growth was which is evident in our figures in the Q4.
So then we have generated. So actually there are three things. One is the. One is the you offer the rate. So people have offered even 8%, 7.90 and above also during the Q4. So they have got it. But then we try to take the deposit during January, February itself. And then we, we continued because we were very confident on the retail term deposit growth and the CASA growth. And we could achieve it. So rather than going to bulk deposit we could achieve this side of the story. So now going forward this cannot be every time.
So certainly you will see the growth in the total deposit. It may come from casa, it may come from retail term deposit and it may come from the buck deposit. So I think in the going forward, see every time you cannot manage the book and allocation and other things. So the thing is that at least first are you aware of from where it is raised and where it is deployed. So now with this, that is why the last March 26th you can see we have raised the deposit, we have raised the CDs. So we have raised the resources.
Ajay Bansal
Thank you sir. And just to reconfirm your 38% above your comfort level on LCR. Very much,
Asheesh Pandey
Thank you.
Operator
Thank you. Next question comes on the line of aselesh with Kotak Securities. Please go ahead.
Ashlesh Sonje
Hi team. Good afternoon sir. Firstly on this prudent provisions which you have created, can you just highlight that after the creation of these prudent provisions where are you on the eclipse shortfall number? Now last quarter you had shared a number of about 40 to 40200 crores. Roughly that is one.
Asheesh Pandey
So we are on the same 4300 crore. And that is that the last time also said we will be comfortable on that. And whatever guidelines come at appropriate time we will decide in the board. And accordingly we will go ahead with the approach. But then since this figure is with us, this amount was with us. We thought of keeping aside maybe a ECL Maybe, maybe any other circumstances where accurate as per the regulatory guidelines and as per the board decision, we would like to then use it. Otherwise we would like to keep it as.
As a strengthening of the balance sheet.
Ashlesh Sonje
Understood sir. But after the creation of this 700 crore buffer the ECL shortfall number should decline ideally, right?
Asheesh Pandey
It will not decline because this is a separate. No. So we have made a very clear. It is not impacting your Tire 1 or Tire 2 or Capital or a net profit. It is just simply kept. So it is like, you know, we have just kept it for any, any eventually any circumstances like that.
Ashlesh Sonje
Understood sir. Just one follow up. What is the total outstanding buffer of standard asset provision that you are carrying now?
Asheesh Pandey
You have it.
Ajay Bansal
Total
Ashok Ajmera
Standard asset provision is close to 3,000 crore.
Ashlesh Sonje
Second question, last one from my side. Yeah, so second one on the. Sorry to harp on the loan growth and margin side. If I look at the credit rating mix of your corporate advances which you have shared on slide number eight, it seems like the share of A and above advances has increased by 2% CoQ. So it’s clear that you have not only grown the corporate advances, you also grown in, you know, better quality corporate advances. However, there seem. This seems to be different from the stance which you had conveyed last time that you are shedding lower yielding advances.
How should we understand this changed instance? What caused this? I could
Asheesh Pandey
Not get it. See no yielding means. No yielding means. You know we had IBPC of around 35,000 crore which is not there. So that is point number one. And then we have slow in the in when you sanction, you have STLs, you have long term loans, you have short term loans. Then sometimes like you know you will give for 7 days, 10 days and it will range about 5.50 to depending upon a corporate and to 6.6.10, 6.25 there we have reduced these two. We have reduced. So we have now tried to convert short term into long terms and other things.
And from that we have to build in so that we become more profitable. But at the same time not to compromise on the quality.
Ashlesh Sonje
Okay, just ask the same question differently. Would you look to shed some more of your lower yielding advances going forward?
Asheesh Pandey
It is a regular phenomena and we are doing day in, day out and wherever we are we are in a position to get the opportunity. So that. That is the reason that actually we have sanctioned more disbursed more. But in the portfolio since channeling is happening you will not see that much big growth there. But then the things are on board and certainly it is a normal. Every bank will do wherever possible.
Ashlesh Sonje
Understood, sir. And just one last clarification. Do you deduct the dividend payout from the net worth in the March quarter itself?
Ajay Bansal
Yes. The remaining portion is only taken in network.
Ashlesh Sonje
Sorry, Come. Come again sir. I could not hear you.
Ajay Bansal
So the. The amount of dividend proposed wasted around 3800 we have deducted and remaining amount is only taken into my capital portions.
Ashlesh Sonje
Understood, sir. Thank you very much. Those are all the questions I had.
Operator
Thank you. Next question comes from the line of Parth and Kutka with 361 capital. Please go ahead.
Unidentified Participant
Hi sir. Thanks a lot for the opportunities. Just let me know what is the. What is the portion of the MSME book which is covered. Covered under cgt msc.
Ajay Bansal
Come back to you on this, sir.
Unidentified Participant
Okay. Okay. And my second question is. Sir, while you know large part of the growth within MSME would have happened, you know, in you know, second half of Feb and March. What were the conversations, you know, with the borrowers? Because you know at that time the war had already started. So what was, you know, what were the conversations in terms of order inflows or cash inflows at that point in time? Yeah, that’s my question.
Unidentified Participant
See there is actually nothing. See always there will be that. There will be some people who were asking for some extension of bills which has been sent. Because everybody was only. The war was only developing actually. So everybody was also waiting for that. So presently the discussions are going on. Wherever it is there they’re also handholding them. And we are trying to support those MSMEs with higher period for bills. Those things. We are doing it.
Unidentified Participant
Okay. Okay, sir. And this my last question. Have you changed any of your risk filters in March or for. For the msme?
Unidentified Participant
Have
Unidentified Participant
You changed.
Unidentified Participant
No. No.
Unidentified Participant
Okay. Okay, sir. Thanks. Thanks.
Operator
Thank you. We’ll take the last question. That’s from the line of Dixit Doshi with Whitestone Financial Advisors Private limited. Please go ahead.
Unidentified Participant
Yeah, thanks for the opportunity. Just couple of things. Firstly, Mr. Doshi,
Operator
Can you speak a little louder? We cannot hear you.
Unidentified Participant
Yeah. Is it better now?
Operator
Yes. Please go ahead.
Unidentified Participant
Yeah. So firstly, what is our return of tool now? And if we see this year the recovery from return of account was 4,000 crore. What kind of recovery will this number sustain next year as well?
Unidentified Participant
If you are looking at it is around 71,000 crores actually. And most of them around 45 to 46,000 are under in the NCLT. It is there pending as regards to recovery in a return of accounts. We are, we are trying it with whatever it is available. We are just seeing that and most probably the same trend will be continuing in the current year. So.
Unidentified Participant
Okay, so whatever we have done this year is sustainable. Yeah. Okay. And my last thing, one last thing is so whatever you have, you know, communicated throughout the call, is it fair to assume that, you know, kind of the name has bottomed out in this quarter and with 13, 14% loan book growth, what we are targeting for next year, the NII growth will be similar to the loan book growth.
Unidentified Participant
Definitely our endeavor is the same.
Unidentified Participant
Okay. So we can grow our NII as well in line with the advances growth. Because this quarter it was lagging.
Asheesh Pandey
Yeah, it was lagging because. Because.
Unidentified Participant
Yeah. So considering that as of now the rate, you know, rate cycle is less, let’s say a status quo, our NII growth should be similar to the advances growth.
Unidentified Participant
Yes.
Unidentified Participant
Okay. That’s it for myself. Thank you.
Operator
Thank you ladies and gentlemen. That was the last question for today. We have reached the end of question and answer session. I now hand the conference over to the management for closing comments.
Asheesh Pandey
So thanks to all the enlist participants on this call and certainly we hear to you a lot. We work upon your questions and even if you can see what sort of things we are doing, depending upon the queries and wherever you have a concern and we try to try to inform you what we have done and how. So that’s the reason that you know, we think of keep on improving day by day, week by week, month on month. So that is the total endeavor. And thanks to all of you for participating in this enlist call. And yes, going forward we would like to better it like we said in the earlier quarters and we continued so.
And the good going forward also we continue to make it better. Thank you. Thank
Operator
You. On behalf of Union bank of India. That concludes this conference. Thank you for joining us. You may now disconnect your lines.