What were the major drivers of growth during the quarter?
The bank’s total business growth is 13.24 per cent. Out of that, deposit growth is 12.62 per cent and advance growth is 14.24 per cent. The good thing is our Casa (current account savings account) growth is also 9.86 per cent, and sequentially it has gone up from 38.87 per cent to 39.08 per cent.
So, we have been able to maintain Casa. Yeah, bulk we have maintained at the same level as December. We grew in deposits, despite not adding anything in the bulk deposit. So, some cost savings happened.
Advances also grew because of our strategy of not going for very aggressive pricing or very competitive accounts where pricing is very low. Because of that, even with a rate cut of 25 basis points, yield on advances has come down by only 9 bps. That has also helped. All these three or four factors have contributed to better growth and net profit.
And if you talk of the main driver of the advances, it was the Ram (retail, agri, and MSME) sector. Ram sector growth is around 16.65 per cent. Out of that, retail has grown by 18 per cent, MSME 16 per cent, and agriculture 15 per cent.
In Ram, auto and jewel segments grew substantially by 44 per cent and 89 per cent during the quarter. What is your strategy considering a higher gold price scenario?
This vehicle loan segment was also growing in the range of 40 per cent earlier. Of course, the impact of the GST 2.0 decision is there. I expect the 40 per cent growth to continue during the next quarter as well.
Jewel loan also… we see good growth. Though we have grown, we have also sold some Inter-Bank Participation Certificates (IBPC). If there is some good opportunity, we are also generating profit from them. We are seeing good demand, but we have taken various measures also as the price is at an all-time high.
We have also remained cautious that as and when, say, gold prices come down, the bank should not be impacted adversely. We have taken various measures like capping the gold price to a two- or three-month moving average. LTV (loan-to-value) has also been slightly strengthened.
How do you see the impact of the transition to the expected credit loss (ECL) framework?
Even if I give you some number on the impact, that will be of no use because these are draft guidelines. We have also requested the RBI for some changes. So let us wait for the final guidelines to come out. Keeping ECL in mind, we have already started making provisions for standard assets.
My aim is to absorb the entire ECL impact in the first year itself. I have the option to raise some capital. Even if I don’t go for a qualified institutional placement (QIP), I will absorb it in the first year itself.
What is your long-term growth roadmap?
We set a target of doubling the business figure in five years in December 2024, when it was ₹12.62 trillion. I am aiming to make it ₹25 trillion by December 2030. Now, it is ₹14.3 trillion. In the last one year, we have added more than ₹1.7 trillion, and we are on track.
We are performing better than the guidance for the fiscal. Deposit guidance I gave was between 8 to 10 per cent; we are growing by 12.62 per cent.
Advance guidance I gave was 10 to 12 per cent and we are growing by 14 per cent. For us, MSME remains the focus area. In these nine months, we have sanctioned around 4.14 lakh accounts and disbursed around ₹33,000 crore to MSMEs.
We are gradually increasing the use of AI in the opening of current accounts, for cross-sell modules, personal finance management, automatic grievance redressal, and even suspicious transaction reporting.
How do you see the new labour codes, and how are you looking at their impact?
All public sector banks, including my bank, will be barely impacted. I have only 15 contractual employees, and the impact of that on my gratuity and all is only ₹55.86 lakh.
There were reports that several banks are looking into a proposal for a ₹25,000 crore loan facility for struggling telecom operator Vodafone Idea. Did they approach you formally?
We don’t have any exposure to Vodafone and have not been approached so far.
Any impact of the US tariff on your bank?
It is very minimal. My total export exposure is less than ₹1,500 crore, and out of that, exports to the US are only 4 to 5 per cent.
 "Binod Kumar, Managing Director and Chief Executive Officer, Indian Bank")