Bandhan Bank: Will there be any tailwinds for Bandhan Bank on NIMs going forward? Chandra Shekhar Ghosh explains

“If we see that whatever the slippage happened in the Rs 1390 crores, out of that 45% of this slippage happened in the October month, which in that the two causes we mentioned about it,” says Chandra Shekhar Ghosh, MD & CEO, Bandhan Bank.

Well, the credit cost this quarter has remained quite stable. But if I recollect right, you were targeting a credit cost that will be in the range of 2% plus-minus maybe 20 basis point. Do you still hold on to that target?
We have guided the credit cost 2% plus 20 basis point or minus. So, in that sense, it will be come to highest in 2.2 or 1.8. So, in that sense, if you see that the stable credit cost has come 2.5 and the fourth quarter it is a very good quarter, always has happened on that the growth and quality of the portfolio. I have confidence on that the quality of the portfolio is credit cost, it will be that line, we will be trying to reach on that. I also wanted to understand what the outlook is when it comes to slippages for the quarter. We did see a spike in slippages due to the system migration?
If we see that whatever the slippage happened in the Rs 1390 crores, out of that 45% of this slippage happened in the October month, which in that the two causes we mentioned about it. One is a very big transformation happened in the bank, which is the CBS and other applications that is and second is the long holiday because of the puja.

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But when I come to this, the balance 55% are coming to the November and December which is the average is coming Rs 380 crores per month and which have been shown because of this November and December drastically has come down of the slippage and again the January is also showing the better than the December. And, of course, it will be helped on that coming to the next couple of months, it will become to the line of that, lower than the last quarter.

Let us also talk about your NIMs because they have remained healthy at 7.25% this quarter too. Are you seeing any tailwinds for NIMs going forward as well?
If you see that now, there is a situation. It is in very high liquidity situation, very tight liquidity situation and this tight liquidity situation, cost of fund has increased across all banks and that has impacted the NIMs.

So, we after that also if you see our NIMs are 7.2%. So, we feel that as per our guidance, this financial year 7% to 7.5% will like to see that we can be managing that.

But what will be happen for next year or onwards on that, we have the strategic plan in February-March and we can explain all the matters and rationalise on how much it will like to come to the future. We will be like to get back on that.

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