Yes Bank Limited (NSE: YESBANK) Q3 2025 Earnings Call dated Jan. 25, 2025
Corporate Participants:
Prashant Kumar — Managing Director & Chief Executive Officer
Rajan Pental — Executive Director
Niranjan Banodkar — Chief Financial Officer
Analysts:
Jai Mundhra — Analyst
Rakesh Kumar — Analyst
Unidentified Participant
Srinivas — Analyst
M.B. Mahesh — Analyst
Janmejaya Mohanty — Analyst
Manish Soni — Analyst
Sigera Musubareti — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to Yes Bank’s Q3 FY ’25 Earnings Conference Call. On the management panel, we have with us today Mr Prashant Kumar, Managing Director and Chief Executive Officer; Mr Rajan Pental, Executive Director; Mr Manish Jain, Executive Director; Mr Niranjan Banodkar, Chief Financial Officer; Mr Pankaj Sharma, Chief Strategy and Transformation Officer; and Mr Sunil Parnami, Head of Investor Relations and Sustainability. MR. Prashant Kumar will now give you an overview of the results, which will be followed by a Q&A session. 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 this conference, please signal an operator by pressing star and then zero on your touchdown phone. Please note that this conference is being recorded. Before we proceed further with this call, please note, while all efforts will be made that no unpublished price-sensitive information would get shared, in case of an inadvertent disclosure, the same would in any case would form part of the recording of the call. No further, some of the statements made in today’s call could be forward-looking in nature. A note to this effect is provided in the Q3 FY ’25 results presentation itself, shared on the Bank’s website. I now hand the conference over to Mr Prashant Kumar. Thank you, and over to you, sir.
Prashant Kumar — Managing Director & Chief Executive Officer
Thank you. Thank you. A very good afternoon, everyone. I would like to start by welcoming and thank you all for joining us for quarter three FY ’25 earnings call. On this call, I am joined by the senior team members of the bank. On behalf of the entire leadership team at ESPN, I would like to wish everyone a very happy and prosperous New Year 2025. Moving straight on to our quarter three results, as you would recollect, few quarters back, we had outlined a detailed profitability improvement roadmap, which at the headline level was essentially centered around improving Bank’s operating profitability via improving our margins, fee and reducing our cost. We had also guided for our sense of recoveries and redemptions from our security receipt portfolio. I am humbled to report that despite multiple headwinds around liquidity and deposits, system-wide credit is and latest economic data indicating some mixed trends, we have remained right on-track and delivered five consecutive quarters of sequential expansion in net profit. What is more encouraging that the bank has delivered a 25% Y-o-Y and 10.6% sequential growth in our 3rd-quarter pre-provisioning operating profits at INR1,079 crores. This is second successive quarter of operating profit expansion. Further, PPOP as a ratio to average assets improved by-10 basis-points, both sequentially and on Y-o-Y basis and inched up to 1% from 90 basis-points. Having said that, as we look to replicate the same over the coming quarters, we would remain extra of the external macro, be more prudent and calibrative, yet nimble and agile in our approach and actions. Talking of individual components, in-quarter three, our net interest margin came in at 2.4%, flat both sequentially as well as same quarter last year. From margin standpoint, it was an important quarter of inflection as it marked the beginning of meaningful reduction in our outstanding RIDF deposit balances, which reduced by over INR8,000 crores, largely towards last week of December ’24. These RIDF deposits now stand at around 8% of our total assets as against 10.5% to 11% over the last few quarters. As a result, bank prudently reduced its borrowing by 11% quarter-on-quarter and as outlined earlier, going-forward, while we may continue to see some RIDF related calls majorly for periods prior to FY ’24, but on-net absolute basis, bank looks to be well on to reduce the same below 5% over the next two to three years. Moving on to cost of funds and cost of deposits, both of which were largely flattish over quarter two. Our deposit engine has been firing well with sustained pickup in our CASA balances and CASA ratio, which we believe over-time will start to also meaningfully contribute in our operating margin expansion and profitability. As on at the end-of-quarter three, total deposits at INR2.77 lakh crores, which is up 14.6% Y-o-Y. CASA and retail TDs, that is up to INR3 crores is now at 62.6% of our total deposits. In-quarter three, our average daily saving account balances have grown 32% Y-o-Y and current account balances have grown by 22.1% Y-o-Y. As you would see on Page 4 of our investor presentation, over last four quarters, we have improved our CASA ratio by nearly 350 basis-points, unlike the industry trend, which has seen a drop-in their CASA ratio over the same-period. This reflects the trust in Yes Bank brand, strong acquisition engine, a very well-run deposit franchise which has been consistently delivering through right customer selection, a strong customer value proposition, a motivated team, the right incentives and performance scorecard and an integrated best-in-class tech. Not only that and as we have been articulating in the past, we have also seen really leveraging our branches as a core fulcrual of our business and generating assets and fee-based businesses out of those branches as well. Talking of our customer value proposition and technology, as we recently launched our flagship all-in-one Super Air for businesses called Iris bundling over 100 plus features over mobile and across payment, collection, tax payments and other business requirements. The bank continues to see very good traction in its next-generation UPI payment app, namely Yespay Next and Yespay business, is strategically targeting retail as well as business customers. Details of all these initiatives have been given on Page 18, 19 and 20 of our investor presentation. We believe this coupled with our leadership in digital payment ecosystem and fast market-share gains in match and ECH business gives us a distinctive edge, which would further fuel our CASA as well as cross-sell engine. Speaking of our fee income, the same came in at INR1,512 crores, up 26.6% Y-o-Y and 7.5% sequentially. It is to highlight that our fee income as a percentage of total assets is currently at 1.5% and has seen a steady ramp-up of 20 basis-points over the last eight quarters. It reflects our consistent synchronized execution and going-forward, we expect this momentum to continue and be added by our distribution ramp-up and sustained improvement in our sourcing, cross-sell, partnerships, servicing, customer delight and technology. Talking now of our opex cost, quarter three was second successive quarter, wherein further the bank delivered an improvement in the cost-to-income ratio. Total operating expenses at INR2,657 crores, up by 13.2% Y-o-Y and only 0.9% sequentially. As guided earlier, with asset mix largely remaining stable between wholesale and retail, coupled with our ongoing transformation exercise, including rightsizing initiatives and greater leverage of technology, productivity and process improvement. We expect our cost-to-income ratio to continue to further improve from here on. So to summarize, we are well on-track with sustained pickup in our deposits and CASA, 100% compliance in PSL and its subcategories, RIDF resolution already underway, our cross-sell, fees, digital payments and transaction banking flows thriving well and cost-to-income ratio is starting to improve. Now moving over to advances and asset quality. So at a headline level, there is no change in our overall strategy and we would like our current advances mix between retail and wholesale, which is currently around 60-40 to largely remain the same over the medium-term. Though having said that, this ratio may see some transitory movement between quarters going to change of gears, risk and profitability calibration across segments. The flexibility or advantage that comes with being a trusted universal banking franchise with full range of products catering to various customer segments. So in addition, within the segments as well as between the products, in a particular segment, we would continue with our strategy of profitable growth, though the overall pace of growth may moderate depending upon external macro and our internal risk-adjusted returns thresholds for quarter ended December ’24, our advances have grown by 4.1% sequentially and 12.6% Y-o-Y with strong growth in our segment of SME and mid-corporate, which continued to deliver growth in excess of 25% on a Y-o-Y basis. On the other hand, our retail advances were flattish quarter-on-quarter and were down around 3% Y-o-Y due to ongoing recalibration aimed at profitability improvement. You can see the differential growth rate across the retail products on Page 44 of our investor presentation. In the corporate segment, we have maintained the growth momentum of last few quarters. On asset quality, I won’t go into the headlines details, but as all these vectors have performed in-line with trend of last several quarters and you can find them in our disclosures. Our net NPA along with net carrying value of security received as percentage of advances now stand at 0.6%. We had guided for our SR security receipts to have negligible or mill value by end of FY ’25 and we are well on-track towards that as the net carrying value stand at INR233 crores as of December 2024. Another key highlight in overall numbers is the strong recoveries and resolution at INR1,843 crores, which takes the cumulative recoveries and resolution for nine months of the current financial year to over INR4,400 crores. We are on-track to achieve the guidance of INR5,000 crores for FY ’25 and we would like to highlight that the SR portfolio would continue to contribute towards our recoveries and resolution even after becoming nil in terms of net adding value on our balance sheet. Now I would like to draw your attention to Slide 6 of our investor presentation. Here we have laid out several matrices with respect to our retail asset quality. As you can see, the retail slippages, which includes the rural portfolio has been flat on a quarter-on-quarter basis despite the adverse operating environment, especially on unsecured products, including the microfinances. On a one-year lag basis, the slippages have actually marginally improved as percentage of advances. Within this, the secured portfolio has seen sharper improvement in terms of slippages and even within the unsecured products, except for microfinance, other products have seen flattish trend in-quarter three. Another encouraging trend is that early delinquencies in the form of 31 to 90 days, overdue loans are now stabilizing across both secured and unsecured products. I would like to highlight that this has been an outcome of several interventions and actions with respect to our underwriting, scorecard collection taken over the past nine to 12 months. As I conclude, let me reiterate that all the key business vectors are progressing in desirable direction, including the two important trends that we have seen this quarter in form of the reduction in RIDF balances and flattening out of retail slippages. I would like to thank you all once again for your continued interest in our franchise and progress. Thank you. Lastly, before we take your questions, let me convey my advanced wishes for our 76th Republic day. With this, we can now take your questions.
Questions and Answers:
Prashant Kumar
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question, they press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. We have the first question from the line of Jay Mundra from ICICI Securities. Please go-ahead.
Jai Mundhra
And congratulations on steady numbers and thanks for additional disclosures this time around on unsecured and a lot of other areas. Sir, I have few questions. First, if I were to calculate the slippages, right, the way you have defined PL and credit card slippages. And it looks like PL slippages in absolute number and percentage are more or less stabilizing, whereas credit card slippages are rising and whereas the loan growth is actually the opposite, right? So PL growth has been lower and declining Y-o-Y, 10%, 12%, whereas credit card growth has been 25% YTD and maybe 30% 40% Y-o-Y. So I’m just not able to understand that of these two unsecured product, one is having higher slippages, but higher-growth and another is slippages are stabilizing, but lower group. So if you can sort of elaborate that.
Rajan Pental
Yeah, Rajan here. So your observation is correct. Now in credit card, the way the book grows is always with a lag because whatever you acquired subsequently, you know, builds up as the utilization and hence the book growth what you see over there. While we are also — we have also calibrated the growth in credit cards vis-a-vis our potential. Now while in cards, you are seeing a higher slippage, but if you look at the — when we are looking at the 30 plus six MOB, three MOB, we are seeing a flattening again like PL, what you see as a trend in the slippages. So both the portfolios, they actually need to be looked at little differently. But PL, one of the other reason why you see a slowing up of the business was also in terms of us trying to recalibrate our scorecards in view of how the market is behaving and how the macro factors are impacting. So you’re right, the PL has shown a flattish trend in slippages and also in the business growth, it has come lower. But from here onwards, PL, we will be in a position to wrap-up, but to the correct segments and we will again continue to have a calibrated strategy for the credit cards as well. But I can tell you both of them have showing at a six MOB a little flattish kind of a trend and we expect that to continue.
Niranjan Banodkar
So Jay,, if I can also add a couple of more points. One, the credit card book, if you look at it from a sequential standpoint, is also not growing at the same pace as it was growing in the past. I think that’s number-one. Number two, the — and that’s the nature of the product, the ability for us to, you know, let’s say intervene and derisk the credit card work very differently from, let’s say, a PL. In PL, you can slow-down the disbursements in credit cards, the mix of revolver can change, while you can still have a book that could kind of play-out, right? So I think I think our approach to unsecured whether on — whether credit cards or PL, I think we’ve been working on it and look at both these sectors with the same lens. It’s just that there are nuances to individual products and we do believe that when we look at — when we look at the 30 plus and lead indicators of risk that some of the plateauing is playing out. In fact, if we look at the new sourcing on credit card, while these are very early indicators, we actually look at new sourcing of credit cards, you know the vintage curves are actually showing us far better performance on credit cards. But anyways, I think we’ll have to see how some of that data will also play-out over a period of time. But I just wanted to make sure that there is no discerning in the way we will look ultimately from a risk standpoint between the credit card and NPL, it’s just that sometimes it is the nature of the underlying product.
Jai Mundhra
That’s right. Okay. So just to understand this, if you say within credit card, would you say that maybe last 12 months origination, their delinquency is lower than the blended one or and hence, you know, can you make that comment that, let’s say, the new origination after your tightening of rules, are they behaving better than the blended number or they may still be higher than the blended, but better than historical curve.
Rajan Pental
So for both PL and PL and credit cards, the sourcing quality of the recently-acquired portfolio is definitely trending well because everybody — like everybody in the market, there is a fair bit of tightening on the norms
Jai Mundhra
Actually, sir, it is behaving very well and hence the slippages are stabilizing. But what I wanted to check is, is this better than the blended one or this is better than a usual vintage curve that was actually if you can specify.
Rajan Pental
See, portfolio plays — plays on a — on an average after six months-to 12 months, that is how it is, but the early indicators are definitely better than the blended. But the blended also has a lot of shape. The part of portfolio which was doing well and the part of portfolio, which had a concerning trend. So vis-a-vis that concerning trend, we are seeing that the pullbacks are better.
Niranjan Banodkar
In any case, Jay, I think we should also keep in mind the fact that if you look at our unsecured as a proportion to retail assets and actually if you look at that as a proportion of total advances, I mean, we are talking about this portfolio up 25% for our retail assets. Right. So that kind of gives you a good sense that we are not — we are not running like a — I’m sorry, at the bank-wide level buyback. So it’s not that we are looking at a very material risk at a full bank level to kind of come and hit us as well.
Jai Mundhra
Right. Sure. And secondly on savings growth, right? So we have been doing exceptionally well in terms of growth, whereas other are struggling and outperformance has been very, very remarkable. If you can also comment, so we have the graded, right? We have 3%, 4%, 5% and 7% offering. Is this the savings growth also in a way inching up your blended SAF cost or you know, I mean, of course, apart from execution, is pricing is also paying a little bit of a difference. So if you can comment what is your blended star now, blended star cost in Q3 and maybe versus last quarter and the year before.
Niranjan Banodkar
So on that, Jay, our blended continues to be stable actually over the last almost three to four quarters and this is despite some of the rate actions that we took more than 12 months back on — across different buckets where we actually took the — it took the headline rate higher and for balances more than more than INR10 lakhs. But despite that over the last one year, in fact, our stock cost is largely anchored. I think it hovers around, let’s say, 5.85.9%.
Jai Mundhra
Sure. And lastly on security receipts, so now the book — unprovided book has come down to INR233 crores. Assuming you maintain similar INR1,000 crore kind of a recovery per quarter run-rate. Does this mean that next quarter onwards, I mean you will have assuming INR1,000 crore recovery, you will have a negative — a net kind of a provisioning also, negative credit cost in — if not in 4Q, then probably from first-quarter onwards.
Prashant Kumar
So Jay, I think if you see the outstanding securities receipt has come down to somewhere around INR2,400 crores, okay. So expecting like we will continue to have a recoveries of INR1,000 crores per quarter and definitely is not going to happen because this is a case which takes a longer time for the resolution, but we would be definitely expecting a recovery of something around INR1,200 crores every year and overall INR3,000 crore-plus from this COVID.
Jai Mundhra
Okay. Sorry, so INR1,200 crores for the year, right?
Prashant Kumar
Yes, yes.
Jai Mundhra
And what was the INR3,000 crores? Is it total recovery
Prashant Kumar
From the debt from over a period of time.
Jai Mundhra
Okay. So — and sir, sorry, just on credit cost, I mean, how do you look at — now we have come to a very significant milestone where SR book may become almost zero maybe by next quarter. So how should one look at — and you are saying that retail slippages are stabilizing. How should one look at credit cost? Could it be like insignificant, 20 30 basis-point or it will still be, let’s say, 50 basis-points?
Niranjan Banodkar
So Jay, on credit cost, we’ve — we said last year that we will — we will be comfortably below 50 basis-points. That is what we had said earlier. I think just from the way the ARC recoveries work, they kind of give us some choppiness. Sometimes in 1/4 it might be higher, sometimes lower. But we do believe on an average, our credit cost should continue to be in the range of about 30 basis-points. But again, this is not a guidance. This is just initial estimates. We will frame our guidance and come back at the end of this year.
Jai Mundhra
Sure. Thank you so much and all the very best.
Prashant Kumar
Yeah, just one quick clarification. I don’t know if you got that right, but the unsecured book is actually less than 25% of the retail.
Jai Mundhra
Right, right.
Niranjan Banodkar
You actually look at that from a bank-wide perspective is less than 10%.
Jai Mundhra
Correct. No, no. So that was very clear.
Prashant Kumar
Okay. Thank you.
Operator
Thank you. The next question is from the line of Rakesh Kumar from B&K Securities. Please go-ahead.
Rakesh Kumar
Hello.
Operator
Sir, you are audible. You may proceed.
Rakesh Kumar
Yeah, sure. So yeah, the good set of numbers and thanks for taking the question. So firstly, the disbursement run-rate seems to be marginally lower. So anything that is — that we should know about on a year-on-year basis.
Niranjan Banodkar
So that’s largely a reflection where our retail disbursements have come down.
Rakesh Kumar
Okay.
Prashant Kumar
If you were speaking about the recalibration of our retail asset portfolio, which is also in terms of staying away from the very low-yielding assets and also the tightening the underwriting for some of the unsecured loans. That has resulted into a lower disbursement Y-o-Y, but now we are inching back towards the normal, which would take some time. But next year we are quite confident that we would come back to the normal disbursement and would result into a growth in the retail assets.
Niranjan Banodkar
Yeah, in the details, Rakesh, you’ll find on Slide 44, we have the disbursement in absolute growth given on the.
Rakesh Kumar
And this cost-income ratio, which is coming down for corporate book, is it due to a like loan pricing issue that is prevalent in the system or it is due to the asset quality like because interest reversal number. So what is the reason for that cost-income in the corporate segment having gone up?
Niranjan Banodkar
And Rakesh, you’re referring to the segment results.
Rakesh Kumar
Yeah, yeah, yeah.
Niranjan Banodkar
Okay. So see there ultimately, I mean, it’s the nature of the corporate business where you’re able to build a scale and that does not come at any incremental cost-effectively. So you will kind of see that from a cost-income standpoint. They operate at very low-cost income.
Prashant Kumar
But fundamentally like what you were saying, the reason is more in terms of very fine pricing which is happening in the market on the corporate side, but not because of any kind of slippage.
Rakesh Kumar
Understood that, yeah, because in this environment like it is more of a retail phenomenon and on the SR side, sir, like you know, so net of you know provisions that we are doing, how should we see the run-rate might be in FY ’26?
Niranjan Banodkar
So Rakesh, Rakesh will not — we’ve not given the guidance on credit cost. But let’s say we — I think I did allude to that question a question in the previous question as well, which is this quarter we are at about 20 basis-points of credit cost. And if you look at the split of that 20 basis-points, we have about 60 basis-points that is the — the write-back that we’ve got from the ARP and we have about 70 basis-points of credit cost on the — on the NPA. We do believe that a function of the normalization of this credit cost. And we’ve also kind of assuming that we will not have like INR600 crores of write-back every quarter. We do believe that we might have a, 10 15 basis-points of uptick in the credit cost, but I think it should still be well below 50 basis-points and our sense is about 30 basis-points of range is that we should anchor our credit costs. And this is to total assets just to clarify.
Rakesh Kumar
Okay. Sure, sure. Okay. Sure.
Prashant Kumar
Thanks. Thanks.
Rakesh Kumar
Thanks a lot.
Operator
Thank you. The next question is from the line of Dev from Horspower Securities. Please go-ahead.
Unidentified Participant
Yes, good afternoon, gentlemen. Can you listen to my voice?
Operator
Yes.
Unidentified Participant
Congratulations on having a excellent bottom-line figure and expected top-line NII figures. Congratulations to all of you.
Niranjan Banodkar
Thank you.
Unidentified Participant
So my I have two questions regarding your result. So first of all, I want to know if you go by your segment result disclosure sheet, retail segment is still in loss. I mean, how many more quarters would you take to recover the retail segment into black or breakeven?
Niranjan Banodkar
Yeah, why don’t you complete your set of questions will respond to that.
Unidentified Participant
Yes, second one is regarding the stake sale, till the stake sale goes on or goes completed, why don’t you go for QIP?
Niranjan Banodkar
So okay, I’ll — I will take — I’ll take the first question. This is Niranjan, and I’ll request Sumar to speak about stake sales. So on the retail loss, if you if you look at the way the retail segmentation is and it’s also a reflection of the way the method for the segmentation works out. So our entire branch distribution, infra, people cost is all loaded into the retail segment. And then of course, what we are also encountering for the last four, five quarters is the fact that we’ve been making higher provisioning as a — as a function of the slippages that we’ve had in the retail business, right? And the point we were making earlier is, so we’ve slowed the book down with the clear focus that we will want to focus on profitable products. Now it takes time for this new portfolio to start taking shape and start becoming dominant part of the entire business. And that journey, once it starts playing out, you will start seeing the effect of those in your — in your profitability for the retail segment, right? But we are kind of working quite meticulously on solving profitability of retail assets and that will happen with the change in-product mix as well as normalization of the credit cost. Second, what we are also doing is on our entire branch network, we are making sure that we are very frugal and efficient and by not putting overloading it with cost to — to scale-up businesses. And we’ve been able to demonstrate that also over the last 12 months. So if you look at our cost of deposits and our operating cost growth is actually quite contained as compared to what you will see in terms of the deposit growth that we are delivering, right? Now it is a matter of, I would say, evolution where the varied cost will have to normalize, which we are confident about, but it will take some quarters once that happens, you will start seeing contribution from the retail business go up. In fact, as we look at our ROA journey of 1% over the next three years. The swing or the delta that will come in will actually be going to come materially from the retail business. And we are all working towards that. But we are very conscious about the observation that you made and we and we are working trying to execute each of those aspects. That’s number-one. I think the second point you had was on stake sale. While I will — before I hand it over to Mr Kumar to take that question, I think the one point I wanted to call-out is, if you look at over the last three to four quarters, we’ve hardly consumed capital. And this is despite you know, the advances book growing in excess of 10%, our trade book growing. And that’s because of course, one is we continue to see improving our rating profile or quality of assets on our advances book, it’s also the discipline with which we are now managing the balance sheet side is the portion of the and also improving profitability. So we reported CET1 at 13.3%. If you go back to our pro-forma CET1 post the warrant exercise, which happened in June, we were at 13.4%. So the last nine months, effectively we just consumed 10 basis-points. So just from a capital standpoint, I think 13.3 is reasonable. Now of course, at some stage, we will have to look at capital, but we do believe we have enough capital in play to grow from here on as well. But I’m going to now request Kumar to speak about the stakes, yes.
Prashant Kumar
No, I think has already responded in terms of but we have taken suggestions. But currently we don’t feel the need for any equity because our own equity at 13.3 is adequate to take care of our growth requires
Unidentified Participant
Okay. Okay. And last question, if you mind, if you don’t mind. Yeah. From here on, can we expect your provisioning to come down quarter-on-quarter for at least three to four quarters.
Prashant Kumar
You are saying provisioning coming down.
Unidentified Participant
Yes, the provision for NPA that the credit cost you
Prashant Kumar
In — we are currently around 71% on the provision coverage and you would like to see that our provision coverage would remain at the same level.
Unidentified Participant
Sir, how much — how — what part — at what percentage would you feel comfortable? So around
Prashant Kumar
Around 70%.
Unidentified Participant
Okay. So okay. Thank you.
Operator
Thank you. Ladies and gentlemen, we request you to please restrict your questions to two questions per participant. You may rejoin the queue for follow-up questions. The next question is from the line of Srinivas, an Individual investor. Please go-ahead.
Srinivas
Yeah, good afternoon. As I can see, there is improvement in the CASA ratio and there is also improvement in the RIBF deposits as a percentage of the total assets. But these two things together, they should translate into higher NIMs, net interest margins and consequentially like better bottom-line and higher ROA. But NIMs are flat like it’s at 2.4% for the last two quarters or so. So why this is not happening?
Prashant Kumar
Like I mean the improvements on both these fronts should lead into higher NIMs, like why that is not happening? So Mr, I think you raised both the point the RIDS, if you see that reduction has happened in the last week of the December quarter, okay. So its impact will start happening in the current quarter. That is one part. Second thing that expansion is also a function of your cost of deposit and yields on the advances. If you have observed that we have recalibrated our strategy on the retail asset side, which gives a better yield and better NIM. And I think we are expecting that going-forward, especially the start of the new financial year and we would see the growth on the retail asset, which is going to help us in having the better yields and the
Operator
Okay thank you. Ladies and gentlemen to ask a question you may please press star and 1 one. The next question comes from the line of MB Mahesh from Kotak Securities. Please go-ahead.
M.B. Mahesh
Okay. Hi, just one question on this new ARC guidelines that came in or a clarification that has come in with respect to resolution that the ARC can do with your borrowers, does it have any bearing on the expected recovery rates on your side?
Prashant Kumar
I think we are not aware in terms of whether the ARCs are facing any issues in terms of these kind of resolution even as of now and whether the change in the guidelines would help them in terms of taking the faster decisions. So since we don’t have heavily, I would be saying any kind of have this kind of business within the bank. So we are not aware what kind of impact it will be.
M.B. Mahesh
But, just to just extend this point. Given that we are right now seeing a fairly good recovery from that book, you must — you could have — you must be having some conversation around this guideline, right, because you’re also kind of looking at those numbers to see how much of recovery you will get-in the next few quarters.
Prashant Kumar
No, I think the issue is more in terms of if the guidelines become more stingent then they are the of person. If there is a relaxation in the guidelines, then I think that concern is not there and we would be definitely seeing some improvement in that. But we really don’t know whether there would be a correlation because we are not aware that the ARCs are facing any issues in terms of not able to take the decisions because of that
M.B. Mahesh
Because so-far your assumption is that nothing has changed from your side.
Prashant Kumar
Yeah.
M.B. Mahesh
Okay. And sorry, just to finish this point, what is the current outstanding gross amount of security receipts and the recovery rates expected?
Prashant Kumar
So currently, the outstanding SRs with JCF is INR2,400 around that and I think if we move-in the past track-record we would be seeing a recovery of almost INR3,000 crores from this pool of security receipt and the possibility of also some additional recoveries from the security receipts which have been received in-full also cannot be ruled out.
M.B. Mahesh
Okay. Perfect. Okay. Perfect. Thank you.
Operator
Thank you. The next question comes from the line of Janmajaya Mohanti, an Individual Investor. Please go-ahead.
Janmejaya Mohanty
Hello. First of all, congratulations team on very good results.
Operator
Sorry to interrupt, but you do sound a little muffled on your line.
Janmejaya Mohanty
Hello. Can you hear me now?
Operator
It’s a little better, but low in volume, sir.
Janmejaya Mohanty
Okay. So congratulations team on very good results. My question was regarding the.
Operator
Ladies and gentlemen, the current participant seems to have dropped from the queue. We will proceed to the next questioner, which will be Manish Soni, an Individual investor. Please go-ahead.
Manish Soni
Hello. Good afternoon, Sergey. Yeah, please go-ahead. Sergey, Mehra, my 2019 years back investor or my retail investor or investor,. RFR problems IM at the accounts of, sir, legacy issues in provisions K, SRK provisions KA, retail loan, provision problem, RIDF Director, Mr. Abhi, Majburya, Bolla sir. Sir, issue. January ’24 luck, February luck. Harmina Pandra Tarik, Tarik, September slack, November. Sir whole year team police officer.. Sir, employees,, sir. So her bonus will performance-based hike, that is robust, not printing its machine afterwards or shoppage of.
Prashant Kumar
Yeah, retailer, yeah, investor problem in equity dilute, and Apco Reward Karnai Employeesco. They donko HR they do for a profit must-have come. Other equity issue pilot equity-based sir, Charlak Dusra issue said Charlak balance sheet happening. Up 1,000 quarter of the profits something is wrong, not clear management sir, Bank of Maharashtra sir, example Bolu, Bank of Maharashtra, PCS and Nikla, 15 lakhy balance sheet, Hajar crore, INR1,400 crores sir, Q3 my profit gear. Indian Overseas Bank PCMAT, nearly INR3.5 lakh crore Unka balance sheet, INR875 crore profit.
Manish Soni
Yeah, IDBI Bank sell Leo, sir, INR3.6 lakh crores. So INR1,900 crore profit, sir. For Apna, sir, 500 crore INR600 crore, perhap congratulate Amni, sir. Something is the wrong. O2 responsibility NSA? Sir sir pass is now called high five body degree of sir it and whoa one second just one second. Just one second, let me complete it. Sir, 2020 a problem. Mana Tin Salman or sir INR1,000 crores to profit with, there. I think ESOP so employees do have exercise there. So grant. Exercise will give us option be here. It just be able to say exercise customer. But bank if there are say of
Prashant Kumar
Has give you a full disclosure after employe to exercise, Usco disclosed here that isof that he is a deliver. Dusri after your person heck, you profit him, he suggest. Afternoon, but I have on the balance sheet side., Germany Bank, Jin Bank, OEB Bank, moratorium gas sir. OESR Bank deposit lakh crores we give INR99,000 crores are for us are patient, we have quarter-over-quarter. Jo performance of improvement ahead. If you be financial entity may,, you see both high-risk. So we are making three industry, which I would deposit Kibathou, which are NPA. Quarter-after-quarter, we are moving on a better performance. Would you like to-high support here? Is it supported or us LP, a journey. East banking OVC, it was about to close-down. Opportunity to efforts EH reconfirms AEC of in India is after the stock exchange of employeespo exercises. INR18 crore ESOP, sir, last year issued crore already. This is an alternative,. Maybe after this suggestion is, sir, equity and to — how many of reward reward then I had to update onco bonus there though HRMA capital Jazza there profit would have come to this crores. But against of issue, it’s INR10 crore issue of issue currently total liquidity percentage if we issue — so hope minimum level 100 crores of equity basis or maybe. Okay. Okay. So the dilution have on minimum dilution to compare TCV bank is to both come is., you ask a suggestion the suggestion has been going ahead. But this was the decision Otah had is the Board level for shareholders compare ahead. Yeah, there is a banking balance, this would be taken here.
Operator
Thank you. The next question is from the line of Sige, an Individual Investor. Please go-ahead.
Sigera Musubareti
Yeah. Am I audible? Can you please confirm?
Operator
Yeah, please. Yes.
Sigera Musubareti
Yeah. Good evening, sir. I mean, Hartik, congratulations to Prashant Kumar and Rajan and other Board of Directors. I mean these numbers were fabulous and as per my expectation, it was beyond, okay. So very all the best sir and congratulations. And I mean some investors were talking about ESOP. I mean end-of-the day, ESOP has to be distributed to the employees because they are working for our franchise, you know, to improve further. And we must respect our Board of Directors because, I mean, without these members, without their degree, this bank would have been not in this position, okay, because we should understand like when Prashant saw and Rajan Pandal, they were taking this company, it was posted around INR16,000 crore loss, GNPA was 17%, NPA was 7% and our investment come to raise the capital and
Prashant Kumar
Thank you to — thank you so much for understanding. We then request you to please ask your question?
Sigera Musubareti
Sure, sir. Yeah. So yeah, my question is like if you see quarter-on-quarter, right, the deposits are flat, okay, so 0%. So maybe like coming quarters like end of this year and next year, this will improve or not or it will be saturated because as I mentioned, we were coming from INR99,000 crores and now it is INR2,60,000, INR70,000 approximately. So is it saturated for our bank and we expect any growth. That is one thing. And DPC is our NIMs, our NIMs, okay, it’s like 2.4 there is no improvement though we were showing the profits from other incomes and all. So can you guide us on that as part? Okay. So there was one question related to EAT1. I — in-between my call was disconnected because this — all these SBI other private institutions and even retail investors FPO was because of write-off of 81 bonds. Now again the — I mean, I’m not asking anything how the bank is prepared because you don’t want any comments — comments from the management because it is under the Supreme Court right now. So how will the bank is prepared okay for in that situation. So if you could answer this because 62 63 lakh retail investors are there and you all know that, however stock is performing even though other companies are doing well, public sectors, okay, public or private sectors in the — I mean in India, okay. Our company is like since from last year, if you see, though I understand that market cycles and all, so I would request our management to come and address what is happening in the bank and how we are preparing, okay. So it’s not only me, okay. I do have patience. I’m going to wait three years, five years and I wish my present commercial Rajan Pantal sir to be continued on the Board, okay, next five years, 10 years, though next year our present commercial tenure is going to over. But I request question what and other Board members. I mean, our leader should be there in the Board.
Prashant Kumar
Yes, I answered all your questions. The first question was in terms of deposit growth. I think you have seen like flattish growth for this quarter three, but I think you would like to continue to see the deposit growth because how we are targeting that our loan growth, our deposit growth has to be higher than the loan growth. So whenever we see loan growth is improving, we would increase our deposit growth, but you will see continuous growth in both deposits and advances. Your second point was related to expansion of NIMs. I think if you — just I would like to bring to you notice one particular data point. If you see last 12 months, we have been able to protect our NIMs despite so many headwinds in the industry, whereas some of the competition, there is a pressure on the NIMs and there is a slight decline in their NIMs. So I think in these tough times, we have been able to protect our NIMs. We have taken multiple steps and going-forward, you would see the improvement on the NIM side also. Your third point in terms of AT1, as you are well aware, this is — is pending before the Honorable Supreme Court.
Sigera Musubareti
And now we are expecting all the listing has been done in February. In this particular year, bank is fully prepared in terms of presenting our viewpoint before the audible. But again, very all the best for subsequent quarters and we expect the profits to continue the same in the coming quarters. As you know, like INR60 lakh to INR63 lakh investors are waiting to turnaround story and we want to do festival in our homes as well. Thank you, sir. Keep this in mind and hope we will continue our journey with you and other your team members.
Prashant Kumar
Thank you. Thank you very much.
Operator
Thank you. We have no further questions, ladies and gentlemen. I would now like to hand the conference over to Mr Prashant Kumar for closing comments. Over to you, sir.
Prashant Kumar
Again, I would like to thank all of you for continuing to support the bank, engaging with our franchise. We wish all of you with your family members, a very happy New Year of 2025 and best wishes for our. Thank you so much.
Operator
Thank you. This brings the conference call to an end. On behalf of Yes Bank. We thank you all for joining us. You may now disconnect your lines.