Yes Bank Limited — Q4 FY26

Yes Bank Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=hlQKPd3vPkU Published: 3 weeks ago

0:00 Ladies and gentlemen, good day and welcome to Yes Bank's Q4 FY26 results conference call. 0:08 8 seconds On the management panel, we have with us today Mr. Vine M. Tons, managing director and chief executive officer, 0:14 14 seconds Yes Bank, Dr. Rajan Pintal, Executive Director, Mr. Manish Jen, Executive Director, Mr. Niranjan Banodkar, Chief 0:24 24 seconds Financial Officer, and Mr. Sunil Parnami, head of investor relations and sustainability. 0:30 30 seconds Mr. Vine M Tonce will now give you an overview of the results which will be followed by a Q&A session. 0:37 37 seconds As a reminder, all participant lines will be in the listenonly mode and there will be an opportunity for you to ask questions after the presentation 0:45 45 seconds concludes. Should you need assistance during this conference, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. 0:58 58 seconds Participants are requested to ask questions pertaining to the bank's Q4 FY26 results only. For any other information, you may reach out to the 1:05 1 minute, 5 seconds corporate communications team separately. I now hand the conference over to Mr. Vine Mi. Thank you and over to you sir. 1:15 1 minute, 15 seconds Yeah, thank you very much. And at the outset, our apologies for uh getting into this meeting a little late. we got stuck in some other uh meetings today. 1:25 1 minute, 25 seconds Sincere apologies for that. 1:28 1 minute, 28 seconds But formally to start uh good afternoon everyone and uh thank you for joining us for the SB Bank Q4 and the full year FI26 earnings conference call. 1:40 1 minute, 40 seconds While I have interacted with many of you in my earlier role, this is my first earnings interaction as the MD and CEO of the Yes Bank and I'm very pleased to 1:49 1 minute, 49 seconds join you today along with my senior leadership team and I also look forward to building a long-term engagement with 1:56 1 minute, 56 seconds all of you. As part of my opening remarks, I will briefly cover my first impressions of the bank, our take on the 2:05 2 minutes, 5 seconds current operating environment and key highlights of our quarterf as well as the fullear FI26. 2:13 2 minutes, 13 seconds But at the outset, I would like to express my sincere appreciation for Mr. 2:17 2 minutes, 17 seconds Prasant Kumar, my predecessor. Over the past several years, he led SBA bank through a multi-year and truly unique transformation. 2:27 2 minutes, 27 seconds His leadership was pivotal in stabilizing, strengthening and also re-entering the institution. 2:35 2 minutes, 35 seconds I must also bring in here mention of the strong support of the government of India, the Reserve Bank of India and the 2:42 2 minutes, 42 seconds State Bank and other banks who got in together to bring in the reconstruction of the H bank and also last but not the 2:52 2 minutes, 52 seconds least the board of directors which guided us during this period and also our customers and employees who 2:59 2 minutes, 59 seconds were have a huge source of strength for us. Thanks to these collective efforts, the bank I now have the responsibility 3:08 3 minutes, 8 seconds to lead stands on a very stable foundation. Even in challenging periods, the bank brand remained relevant and 3:16 3 minutes, 16 seconds trust was rebuilt gradually through steady execution. 3:20 3 minutes, 20 seconds Today, the bank operates on a stronger base with resilient asset quality, a more granular franchise, a strengthened 3:29 3 minutes, 29 seconds deposit engine, and renewed stakeholder confidence supported by strong shareholders such as SNBC, SBI, and Advent International. 3:40 3 minutes, 40 seconds Over the last few weeks, I have spent meaningful time across teams and functions, listening, understanding, and 3:48 3 minutes, 48 seconds also observing the nuances of how this bank operates. 3:53 3 minutes, 53 seconds My early interactions have highlighted the steady commitment of the S bankers who have been supportive through 4:00 4 minutes challenging periods and contributed to restoring confidence. 4:05 4 minutes, 5 seconds I've also seen a strong alignment of purpose across all the stakeholders that's amongst employees, customers, 4:13 4 minutes, 13 seconds regulators, the board and investors which is very reassuring for the path 4:19 4 minutes, 19 seconds ahead for us. Alongside this, our modern technology platform, the leadership in 4:26 4 minutes, 26 seconds digital payments ecosystem we have and collaborative embedded banking capabilities provide useful strengths as we enter the next phase of growth. 4:38 4 minutes, 38 seconds Going forward, we will build on what is working well, strengthen areas that require more attention and pursue growth 4:45 4 minutes, 45 seconds that is thoughtful, calibrated and also sustainable. 4:49 4 minutes, 49 seconds Execution, discipline, and stakeholder trust will remain central to how we operate. Looking ahead, we will continue 4:57 4 minutes, 57 seconds to invest steadily across four basic areas. Our people, our product, our processes, and technology platforms. 5:07 5 minutes, 7 seconds These remain important to strengthening the bank over time. 5:11 5 minutes, 11 seconds We will also keep building on the power of one SBank to ensure a consistent customer experience across businesses. 5:19 5 minutes, 19 seconds In addition, our ongoing collaboration with SMBC provides helpful strategic support particularly in corporate and crossber banking. 5:31 5 minutes, 31 seconds Now let me talk about the macros as they are evolving. We are closely observing the fast evolving global environment 5:39 5 minutes, 39 seconds including the AI landscape and the geopolitical conflicts impacting global growth, supply chains, energy and fried 5:49 5 minutes, 49 seconds costs and also the inflation and interest rate trajectories. Against this backdrop, India remains comparatively 5:58 5 minutes, 58 seconds resilient, supported by steady domestic demand and a stable financial system. As 6:05 6 minutes, 5 seconds a bank, we remain attentive to these trends and their potential implications for our businesses. 6:14 6 minutes, 14 seconds So the third part now I would now share some of the key highlights of our quarter 4 and also the fullear FY26 performance. 6:24 6 minutes, 24 seconds Despite the ever evolving macro environment, the bank closed FI26 with stable and improving financial 6:32 6 minutes, 32 seconds performance, underscoring our progress on profitability, productivity and balance sheet quality for the full year 6:40 6 minutes, 40 seconds FI26 net profit stood at rupees 3,476 cr up 44.5% over FI25. 6:52 6 minutes, 52 seconds The net profit of INR rups 2,46 cr supported by continued improvement in 7:00 7 minutes our operating performance and ROI for the full year was at 0.8% versus 0.6 six in FY25. 7:11 7 minutes, 11 seconds Number two, for the quarter 4, the bank reported a net profit of rups,68 7:17 7 minutes, 17 seconds cr reflecting a strong growth of 44.7% net profit over the net profit of rups 7:25 7 minutes, 25 seconds 738 crores in the corresponding quarter of the previous year. In line with our guidance, bank reports ROA for the quarter of 1%. 7:37 7 minutes, 37 seconds Number three, talking of our net interest income and NIM, NII for the quarter was 7:45 7 minutes, 45 seconds rupees 2,638 cr which was up 15.9% YI despite adverse interest rate 7:54 7 minutes, 54 seconds environment and elevated comp competitive intensity and deposits our NIM saw an improvement 8:01 8 minutes, 1 second of 10 business points quarteron quarter and 20 business points yearon year and came in at a number of 2.7%. 8:10 8 minutes, 10 seconds Even for the full year, the limb at 2.6% improved 20 basis points with FI25 and 8:19 8 minutes, 19 seconds in line with our guidance given in Q4 of FI25. 8:23 8 minutes, 23 seconds Our margin improvement was supported by multiple factors namely front lo front front loading of our deposit reprising 8:32 8 minutes, 32 seconds that happened last April, continued outperformance in CASA and sustained reduction in high-cost borrowings 8:40 8 minutes, 40 seconds mirroring continued rundown of the RIFF and PSL related mandated deposits. Net 8:47 8 minutes, 47 seconds interest income for FI26 at rupes 9,776 cr grew 9.3% yearonear. 8:58 8 minutes, 58 seconds In line with our guidance in FY26, the bank had a second straight year of 100% compliance in PSL and all of its 9:07 9 minutes, 7 seconds subcategories which resulted in notable reduction of RAID and other mandated deposits to 6% 9:16 9 minutes, 16 seconds of total assets with 9% as at the end of FI25. That was 6% now against 9% last year. 9:26 9 minutes, 26 seconds [clears throat] The bank continues to see a gradual increase in its organic accretion of PSL across subcategories. 9:35 9 minutes, 35 seconds Going forward, the bank remains well on track to reduce these deposit balances to below 5% by fiscal 27 which will aid our margins and profitability. 9:49 9 minutes, 49 seconds As regards the non-interest income, the bank saw continued momentum across all diverse and granular fee income streams. 9:58 9 minutes, 58 seconds Non-interest income for the FI26 at rupees 6,759 crrew 10:05 10 minutes, 5 seconds 15.4% yearonear driven by healthy traction in retail fees, theme and commercial banking fees and also on the 10:15 10 minutes, 15 seconds back of a strong transaction banking performance. 10:18 10 minutes, 18 seconds We continue to strengthen our fee momentum by deepening client engagement, improving the cross-ell intensity in wholesale banking and scaling our 10:27 10 minutes, 27 seconds digital fee engines. This includes driving higher penetration of forex trade and CMS flows within our corporate 10:36 10 minutes, 36 seconds relationships while broadening retail fee contributions through pre-approved programs, cards, payments, and wealth 10:45 10 minutes, 45 seconds offerings. Over the last 3 years, the bank has seen a meaningful increase in its non-interest income to average 10:52 10 minutes, 52 seconds assets ratio, which has increased from 1.1 in FI23 to 1.5% this year. FI26. 11:02 11 minutes, 2 seconds Cost to income ratio for FI26 also saw a big improvement to 66.7% versus 71.3 11:11 11 minutes, 11 seconds in FI25. That's 66.7 now versus 71.3 last year. The exit for the financial 11:20 11 minutes, 20 seconds year came in even lower with the cost to income ratio coming at 63% 11:27 11 minutes, 27 seconds with 66.1 Q3 FI26 and 67.3 the same quarter last year. The decline 11:36 11 minutes, 36 seconds has been in line with our broad guidance to gradually keep bringing down our cost to income ratio and we expect the momentum to continue. 11:45 11 minutes, 45 seconds Improving core profitability remains a central theme for us. For FI26, the bank had a PPOP pre-provisioning operating 11:54 11 minutes, 54 seconds profit of rupes 5,56 cr which grew 29.4% yearonear. 12:02 12 minutes, 2 seconds FI26 PPOP as a percentage to average total assets improved to 1.2% 12:09 12 minutes, 9 seconds versus 1% for FI25 and.9% in FI24. The PPOP for the quarter was 12:18 12 minutes, 18 seconds rupes,618 cr up 23.1% yearonear supported by 12:25 12 minutes, 25 seconds income growth outpacing expenses growth reflecting sustained expansion in our operating jaws. 12:36 12 minutes, 36 seconds Asset quality remained strong during the quarter. As at 31st March 26, the bank reported gross NPA and net NPA of 1.3% 12:45 12 minutes, 45 seconds and 0.2% respectively, the lowest ever that we have seen in the last 24 quarters and amongst the top quartile in 12:54 12 minutes, 54 seconds our peer set. Sequentially, the GNPA and NNPA ratio improved by 20 and 10 basis points respectively. 13:04 13 minutes, 4 seconds Further the provision coverage ratio the PCR contains continues to remain healthy at 81.9%. 13:13 13 minutes, 13 seconds The resolution momentum remained strong. 13:16 13 minutes, 16 seconds The bank had total recoveries and upgrades of Rs 4,795 cr in FI26 which included recoveries from security 13:26 13 minutes, 26 seconds receipts of a little more than Rs,550 crores against our guidance of Rs, 1200 13:34 13 minutes, 34 seconds rupees, 200 in line with the rundown in the face value of the security receipts we expect recoveries to the queue of Rs 13:42 13 minutes, 42 seconds 800 to 1,000 cr from SR. class in FI27. 13:49 13 minutes, 49 seconds The bank continues to reduce its overdue exposures, strengthen early warning mechanisms and enhance the underwriting standards and the collection infrastructure. 14:00 14 minutes Gross slippage ratio in FI26 has improved to 1.8% versus 2.1 last year. 14:07 14 minutes, 7 seconds This has been led by improvement in the retail asset slippages which improved in FI26 to 3.5% 14:15 14 minutes, 15 seconds from 4% in FI25 with the exit rate even lower at 2.8%. 14:22 14 minutes, 22 seconds Quarter 4 this quarter 4 versus 3.4% the last quarter. 14:28 14 minutes, 28 seconds Retail slippage for Q4 at rupees 888 cr is at its lowest in the 14:36 14 minutes, 36 seconds past nine quarters with improvements visible across both secured and unsecured products. Together these 14:43 14 minutes, 43 seconds trends underscore the resilience of our asset book and the effectiveness of our ongoing credit risk management efforts. 14:52 14 minutes, 52 seconds Overall credit costs remained low at2% for the full year FI26 versus.3% 14:59 14 minutes, 59 seconds last year. Credit costs were the Q4 was at 0.17%. 15:08 15 minutes, 8 seconds Now moving over to the balance sheet highlights growth saw a marked uptick during the quarter aided by acceleration across 15:16 15 minutes, 16 seconds business segments. Total advances registered a growth of 11.1% yearonear to rupees 2.73 lakh crores. Retail 15:26 15 minutes, 26 seconds disbburments in particular have gained significant momentum registering 41% yearon-year growth in Q4 FI26. 15:35 15 minutes, 35 seconds We remain focused on balanced and profitable growth across retail, commercial and wholesale businesses supported by disciplined risk selection and effective pricing. 15:47 15 minutes, 47 seconds We crossed two critical milestones in our deposits franchise during this quarter. While overall deposits crossed the milestone of three lakh crores, the 15:56 15 minutes, 56 seconds Kaza balances crossed the milestone of 1 lakh cr. Total deposits increased 12.1% yearonear 16:05 16 minutes, 5 seconds to rupees 3 lak 18,000 crores with a strong contribution from retail and branch 16:11 16 minutes, 11 seconds deposits which grew 13.5% yearonear and comprised 58.4% of the total deposits. Kasa 16:21 16 minutes, 21 seconds balances grew 14.9% yearonear to rupees 1.12 lakh cr and even on a aqb basis the 16:30 16 minutes, 30 seconds kaza growth was strong at 11.2% and the kasa ratio also improved 80 basis points yearon year and 110 basis 16:38 16 minutes, 38 seconds points q to 35.1% stands now at 35.1%. 16:45 16 minutes, 45 seconds Gendering of the liability franchise remains a priority for the banks. We are working to reduce reliance on the bulk 16:53 16 minutes, 53 seconds savings bank balances, improving branchled and digital acquisition funnels, enhancing customer 17:00 17 minutes journeys and sharpening the pricing strategy, ensuring competitive positioning without compromising 17:07 17 minutes, 7 seconds stability. Continued improvements in digital onboarding, the KYC processes and the ARM productivity have enabled us 17:15 17 minutes, 15 seconds to capture higher primary banking share from our target customer segments and are the key drivers of our continued outperformance to the industry in Kasa. 17:27 17 minutes, 27 seconds Our credit to deposit ratio, the CD ratio improved to 85.7% 17:33 17 minutes, 33 seconds from 88% in the Q3 FI26 and 86.5% in Q4 FI25. 17:42 17 minutes, 42 seconds Our capital adequacy and liquidity levels remain comfortable to support the growth aspirations of the bank going forward. 17:50 17 minutes, 50 seconds A few other updates from our side. I'm pleased to welcome on board Mr. S. Anant Ramon as 17:57 17 minutes, 57 seconds the chief risk officer of the bank. He is an industry veteran with over three decades of experience with rich experience rich expertise in the risk 18:06 18 minutes, 6 seconds management domain. We also opened 82 new branches during the year which was in line with our guidance at the start of 18:14 18 minutes, 14 seconds the year. Our ESG ratings which are already the best in the banking industry in India continue to see improvement 18:21 18 minutes, 21 seconds across agencies such as S&P, FTSC and the ISS stocks. 18:28 18 minutes, 28 seconds SB bank also has been recognized as a great place to work for the fourth con consecutive year. The bank has rolled out a new business offering in the form 18:37 18 minutes, 37 seconds of S grandar which is the premium banking suite developing and de delivering business 18:45 18 minutes, 45 seconds solutions digital integration and operational benefits for modern enterprise. 18:51 18 minutes, 51 seconds To conclude, as we enter FI27 with stability and renewed momentum, we will 18:58 18 minutes, 58 seconds be continuing to invest in our people, products, processes and technology. 19:04 19 minutes, 4 seconds deepen customer relationships across segments, focus on building a futurative bank with 19:10 19 minutes, 10 seconds very strong resilience and uh finally I thank you once again for joining us today. We can now take uh questions. Thank you. 19:21 19 minutes, 21 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone 19:29 19 minutes, 29 seconds 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 19:37 19 minutes, 37 seconds asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. 19:46 19 minutes, 46 seconds Our first question comes from the line of Jay Karote from Access Capital. Please go ahead. 19:54 19 minutes, 54 seconds Hello. Am I audible? 19:57 19 minutes, 57 seconds Hello. from uh congratulations sir for a good set of results. The first question will be going ahead uh given that I know 20:05 20 minutes, 5 seconds it's been a short stint so far but how are you looking at growth in the bank for the next one year uh is there anything you're waiting for to 20:12 20 minutes, 12 seconds accelerate in terms of uh any of the balances metrics or you think we can start aiming for that 15% plus uh growth 20:21 20 minutes, 21 seconds firstly on on that and second of course is that if you could help us with the average cash growing and uh compared to 20:29 20 minutes, 29 seconds the loan growth made with has held up despite the rate cards but how do you sort of uh you know grow that 20:36 20 minutes, 36 seconds in line maybe in like 14 15% on an average basis so in how how uh how do you address that problem these two 20:45 20 minutes, 45 seconds questions thanks uh Jen hi so uh I'll start with the kasa growth on the average basis 20:53 20 minutes, 53 seconds [clears throat] so on um both ka and sa uh have sequentially grown in the range 20:59 20 minutes, 59 seconds of about 4% % in fact car sequential growth has been slightly more than 4% 21:05 21 minutes, 5 seconds but lended is about of 4%. Um and if I actually look at uh you know term 21:12 21 minutes, 12 seconds deposits uh growth and I'm excluding uh the the CDs that we ended up raising as well u the term deposits also have grown 21:21 21 minutes, 21 seconds uh big picture at about 4%. So uh if I were to characterize the growth uh for Q4 across the deposits uh u it's broadly 21:31 21 minutes, 31 seconds anchored around a 4% uh kasa and DD. So I think you're kind of maintaining the kasa ratio at least um uh from a from an 21:40 21 minutes, 40 seconds average performance uh vantage point right. uh if I look at the uh year yearon-year growth uh on kafa uh that uh 21:49 21 minutes, 49 seconds is anchored at around 11% growth rate um on an average again this is we're talking about average Q4 uh 26 to 21:58 21 minutes, 58 seconds average Q4 uh 25 so that's on deposits you had a question which you started 22:04 22 minutes, 4 seconds with was on uh next year's growth um and you know we you we've kind of discussed this on earlier calls as 22:13 22 minutes, 13 seconds uh we do believe that we're a franchise that indeed you know should be delivering uh growth in line with 22:20 22 minutes, 20 seconds industry uh if not targeting more but there were uh reasons which were quite peculiar to us and conscious why we 22:28 22 minutes, 28 seconds calibrated the growth lower but quite uh quite happy to report that uh we we already seen you know between um 22:37 22 minutes, 37 seconds December and and March that the momentum the sequential momentum is is beginning to um quite accelerate um and you know 22:46 22 minutes, 46 seconds that's kind of ending up with a reported number of 11% on a uh y basis for advances growth. Uh we do believe that 22:54 22 minutes, 54 seconds that momentum should certainly continue uh and not just not just in certain products or segments. I think what we 23:02 23 minutes, 2 seconds are now talking about is a lot more secular uh across uh across segments. Of course, retail u you know dispersement 23:09 23 minutes, 9 seconds growth rates are quite uh you know quite aggressive. We're moving fast now given that we now have confidence on the asset quality and profitability. But having 23:17 23 minutes, 17 seconds said that the book uh you know is slated to grow in double digits next year. So net net we put all of this together uh 23:26 23 minutes, 26 seconds you know we should certainly aim to grow in line with uh with industry if not more and that ball broadly anchors around the 14% range. 23:37 23 minutes, 37 seconds Uh thank you sir. If I could just leave you with one last question on the margin. U this RF rundown has been quite healthy last year. Uh going into next 23:45 23 minutes, 45 seconds year should this trajectory on margin expansion continue Q or or could we see something similar back ended? 23:54 23 minutes, 54 seconds So uh on a year-on-year basis um again some of the rundowns that we had in RAF 24:01 24 minutes, 1 second this year also were uh were more heavy from an H2 perspective. Uh uh so to that 24:08 24 minutes, 8 seconds extent uh FI27 comparison to FI26 even if it is rearended uh should have no material bearing but there is a rundown 24:17 24 minutes, 17 seconds plan. So we uh we we we vented this year at about uh 27,900 24:24 24 minutes, 24 seconds ballpark 28,000 crores. Um we think that uh next year at the minimum the 24:32 24 minutes, 32 seconds reduction should be about uh 6 and a half,000 crores. Uh that could also go as high as 9,000 crores um by the end of March 27th. 24:43 24 minutes, 43 seconds Uh great. Thank you and once again all the best. Uh thank you. Thank you very much. Thank you very much J. Thank you. 24:53 24 minutes, 53 seconds Thank you. Our next question comes from the line of J Mundra from ICICI securities. Please go ahead. 25:00 25 minutes Yeah. Hi good afternoon everyone and congratulations on a good quarter. U sir 25:07 25 minutes, 7 seconds first question is on your growth mix right. So uh we have done uh I mean we 25:14 25 minutes, 14 seconds have achieved 1% ROA asset quality seems to be holding up reasonably well. Um but 25:21 25 minutes, 21 seconds retail slippages while they're improving they're still uh 2.93%. 25:27 25 minutes, 27 seconds And we see that retail advances are you know both up four to 5% on both YI 25:33 25 minutes, 33 seconds basis. Um given the SMBC induction as the largest shareholder do you envisage any change in the loan mix between 25:42 25 minutes, 42 seconds retail, wholesale, commercial as you move towards you know industry level growth. So that is the question number one. 25:52 25 minutes, 52 seconds So J on J. Thank you J. 25:54 25 minutes, 54 seconds Sorry I got similar names. My apologies for that. This is Jay J. 25:59 25 minutes, 59 seconds J of course J I know him well J. Sorry about that. So um on the uh on the growth mix um I think important to note 26:09 26 minutes, 9 seconds is the retail uh dispersement growth because that's really an important control level that we have uh which we 26:15 26 minutes, 15 seconds are driving uh faster. So if you look from a Y perspective in fact we are kind 26:22 26 minutes, 22 seconds of way above a 20% you know YI growth we do believe that it should ultimately 26:30 26 minutes, 30 seconds get normalized in the 20 25% range. Uh but what we are aiming to grow the retail book next year 26:38 26 minutes, 38 seconds is actually should hit the double digit growth. So let's say about a 10 11% is what you do believe it should uh 26:45 26 minutes, 45 seconds deliver. uh if I if I if I look at the corporate uh book uh that's already growing at about 20%. U so we do believe we have the levers to grow at 20%. 26:58 26 minutes, 58 seconds Um commercial banking is a is is something that is a is a space we like uh historically has been a 27:07 27 minutes, 7 seconds good growth driver for us and that continues to also deliver about 18% growth. So netn net net you know I think 27:14 27 minutes, 14 seconds the momentum as is playing out as we are exiting fiscal 26 uh is quite secular across all segments and that therefore 27:22 27 minutes, 22 seconds gives us the confidence to uh to start delivering a growth in line with industry if not uh if not more now maybe 27:31 27 minutes, 31 seconds for about a year or so uh because retail is catching up but they are still maybe let's say end up growing maybe 10 11% 27:39 27 minutes, 39 seconds next year to that extent there will some mix um u I would say compression uh but that's not going to be material um and 27:48 27 minutes, 48 seconds as we kind of move forward I think we will anchor around a reasonably similar mix composition that we have right now 27:57 27 minutes, 57 seconds sure that is very helpful uh and uh on the on the on the treasury uh you know uh 28:05 28 minutes, 5 seconds the bonds the GC had spiked in during the quarter they ended at more than 7% 28:11 28 minutes, 11 seconds at quarter end. Do you had any MPM on investment book or you know um if you 28:18 28 minutes, 18 seconds can uh specify was there any MPM loss either in the P&L or in ESS reserves uh or was there any offset? 28:28 28 minutes, 28 seconds No sure um J I'll take that. So u you know as a as a um as a market philosophy 28:35 28 minutes, 35 seconds you know we don't run very high open risk um you know through a trading book um whether it's bonds or for that matter 28:43 28 minutes, 43 seconds even FX while you've not asked you know I can also confirm that even the FX because of some of the changes that came through regulations it's not had any 28:51 28 minutes, 51 seconds material bearing on our uh mark to market because as a philosophy we don't run uh you know quite large um trading 28:59 28 minutes, 59 seconds positions um on markets uh on uh however yes we do acknowledge that the yields did go up and that has had a bearing on 29:07 29 minutes, 7 seconds our let's say the minimum maintenance book uh which is largely parked in the uh in the htm but we do also note that 29:16 29 minutes, 16 seconds you know the yields have come off uh you know uh you know from the reporting period of March so we will wait and watch how how the yields behave uh but 29:25 29 minutes, 25 seconds that's largely in the htm book there has been some P&L movement uh through the AFS reserve curve but that's already 29:32 29 minutes, 32 seconds fully baked into our CT1 computation for December and you know you would see that uh our CT1 also continues to be healthy 29:39 29 minutes, 39 seconds from a 13.9% we just consumed about 10 basis points uh for the March uh report as well so uh no material uh impact from 29:49 29 minutes, 49 seconds uh from the yield increase on the contrary we do believe that this should help us add to some yield in our investment book from a margin perspective 29:57 29 minutes, 57 seconds right no man if you have the number for EFS reserve So let's say Q3 and maybe the Q4 that will give some sense on the 30:05 30 minutes, 5 seconds what was the movement in the AFS reserves. 30:09 30 minutes, 9 seconds You're saying uh in terms of the absolute value. Yes. Yes. 30:14 30 minutes, 14 seconds The AFS reserve we uh we we have a negative balance of about 100 crores as of March 31st 30:22 30 minutes, 22 seconds which was the Yeah. The swing the swing would be about u would be about uh 200 crores. 30:30 30 minutes, 30 seconds Okay. Sure. And [clears throat] you have mentioned that 340 crores of one time standard assets provisioning as a step 30:38 30 minutes, 38 seconds up provisioning. Um if you can uh elaborate on that is this a is this um 30:45 30 minutes, 45 seconds against any specific exposure? Is this in the runup to ECL or uh or uh you know uh any more color on that? 30:57 30 minutes, 57 seconds No. Uh sure AJ uh important question. Uh so on that uh before I get into that just couple of context uh setting uh 31:06 31 minutes, 6 seconds that I wanted to do. So one uh if you see we continue to have a very strong uh recovery from SRS uh this quarter uh 31:14 31 minutes, 14 seconds which was in the range of 450 crores. Uh the second uh is we've also had one um 31:22 31 minutes, 22 seconds corporate uh asset that got resolved which was uh which had slipped earlier much earlier uh which was provided for 31:29 31 minutes, 29 seconds and that also meant that we had a right back of about uh 288 crores uh during the quarter. uh and third and which is 31:38 31 minutes, 38 seconds very fundamental and more important is our core uh NPA uh credit cost is also lower quite substantially uh quarteron 31:47 31 minutes, 47 seconds quarter right now uh these were like the three uh material uh you know contributors to provisioning uh buffers 31:56 31 minutes, 56 seconds that we have uh that we kind of uh that we that gives us the ability to create. 32:01 32 minutes, 1 second Uh second uh what we do is we've usually followed quite conservative policies from a provisioning standpoint. Um a 32:10 32 minutes, 10 seconds great example is if you look at our MPA uh you know we've we've kind of carried PCRs in the range of 80% plus now for 32:17 32 minutes, 17 seconds the last three quarters right and we've always stated objective to be quite high from a from an NPA standpoint coverage 32:24 32 minutes, 24 seconds right uh so as part of that philosophy as well uh we kind of look through portfolio and our own provisioning 32:32 32 minutes, 32 seconds policies and we did did realize that there are uh sometimes evolving uh and possibly even prudent uh 32:40 32 minutes, 40 seconds provisioning policies and that application we have done um in in Q4 uh 32:47 32 minutes, 47 seconds of of this year which translates to about 341 crores u I want to be emphatically clear here that uh that the 32:56 32 minutes, 56 seconds provisioning that we've done on you know certain let's say product uh in in no way reflect uh a an 33:04 33 minutes, 4 seconds underlying credit issue or an impairment or our view about that sector. It is just what we thought was prudent uh in 33:14 33 minutes, 14 seconds terms of and just being proactive in terms of uh taking more project. 33:19 33 minutes, 19 seconds Understood. Uh thanks and uh sorry I had two more question I can ask them now or 33:26 33 minutes, 26 seconds maybe I can I mean if you if you allow I can speak them now also. 33:31 33 minutes, 31 seconds Um okay sure. 33:34 33 minutes, 34 seconds Yeah sure. Go So uh yeah sir um on on ROA trajectory now we have um you know 33:40 33 minutes, 40 seconds achieved 1% ROA um existed for labor code last quarter and this quarter maybe more than 1% if I exist with the 40 33:48 33 minutes, 48 seconds crores um continuing provisioning uh what is the next milestone um as you had 33:55 33 minutes, 55 seconds hinted that growth you would aim at uh similar to system uh how would you look at ROA trajectory because you M seems to 34:05 34 minutes, 5 seconds be having some tailwinds and asset quality uh you know you anyway have reasonably good tailwind. So what would 34:11 34 minutes, 11 seconds be your next uh stop? Maybe exit FI27 or maybe fullear FI27 if you can provide some color there. Thank you. 34:22 34 minutes, 22 seconds So um it it's again something that you know we've been saying we will want to exit FY26 with a 1% ROA and as you 34:30 34 minutes, 30 seconds rightly pointed out I think uh we are now beginning to deliver that uh more consistently December also being 1% 34:36 34 minutes, 36 seconds adjusted for the um for the graduity cost. Now I I would say that 34:43 34 minutes, 43 seconds directionally having achieved this of course there are two important levers. 34:48 34 minutes, 48 seconds One is sustainance of this um is what we have to make sure we are driving and the important contributor to that 34:55 34 minutes, 55 seconds sustainance and improvement from here on further improvement uh is really going to be on the core uh ROA. Um we have to 35:05 35 minutes, 5 seconds uh ensure and make sure that uh you know we still have some more uh some more of 35:11 35 minutes, 11 seconds benefit that we will get from the JCL uh arc rightbacks uh over the next year. So as we speak we still have about 1,500 35:20 35 minutes, 20 seconds crores of face value of securities which which are which can get redeemed over the next few quarters. Uh so that 35:29 35 minutes, 29 seconds what we have to do over the next year uh year year or two is really make sure that we have the core ROA construct uh 35:38 35 minutes, 38 seconds to offset that not only offset really expand from a beyond reasonably beyond 35:44 35 minutes, 44 seconds 1% ROA. So uh you know I don't want to kind of really put out uh a a number 35:51 35 minutes, 51 seconds from a core ROA perspective uh but our objective internally is really to drive uh you know 25 30 basis points of 35:59 35 minutes, 59 seconds improvement from our core construct right where we get the margins higher get our cost structure higher get our fees higher uh and then of course if you 36:08 36 minutes, 8 seconds know JC Flower benefits keep coming in which we are indeed expecting even should play in FI27 36:15 36 minutes, 15 seconds seven that further adds to our performance. 36:21 36 minutes, 21 seconds Right. Sure. Thanks. And lastly, if you have the number for credit card slippages and maybe PL slippages, it looks like they're clearly improving. 36:31 36 minutes, 31 seconds But uh if you have the number in absolute rupees cr 180 crores for credit card and around 36:39 36 minutes, 39 seconds 140 crores for PL and that will be very useful. 36:43 36 minutes, 43 seconds Uh we will uh we will we'll pull that out. I think maybe we might have interchanged the numbers uh J from your 36:49 36 minutes, 49 seconds record. The credit card uh was about uh 33 cr and personal loans was about uh 180 cr. 37:01 37 minutes, 1 second So that 186 is personal loans is down to about 160 crores. uh and uh credit cards 37:09 37 minutes, 9 seconds uh I think continues to be in the range of about uh 135 140. Sure. 37:17 37 minutes, 17 seconds Thank you very much and all the very best. Thank you. Thank you. Thank you. 37:22 37 minutes, 22 seconds Thank you ladies and gentlemen to ask a question you may press star and one. Our next question comes from the line of 37:29 37 minutes, 29 seconds Adid from Go Digit Life Insurance Limited. Please go ahead. 37:36 37 minutes, 36 seconds Hi uh can you hear me? Yes please. Yes. 37:41 37 minutes, 41 seconds Uh thanks for the opportunity. Uh congrats on the good set of numbers. Uh few of my questions have been already answered. Uh I had one question I wanted 37:50 37 minutes, 50 seconds to get some color on. Uh so I wanted to understand a little uh on our branch expansion strategy. So for the full year we have added around uh 82 new branches. 38:00 38 minutes uh wanted to understand how the uh contribution uh of uh retail uh 38:07 38 minutes, 7 seconds dispersements uh has been uh for the quarter from uh branches and uh as we move uh to the next leg of growth, how 38:15 38 minutes, 15 seconds are we looking at branch expansion uh which locations you're prioritizing and how that aligns with the loan subsegments we're trying to uh prioritize growth in. 38:27 38 minutes, 27 seconds co your question. Um so we had uh we laid out a guidance for uh the next four to five years with a plan of around 400 38:36 38 minutes, 36 seconds branches uh with an average of around 80 branches peranom and we are on course of that we opened around 82 branches uh 38:44 38 minutes, 44 seconds last year and uh and we would be going at with that plan uh depending on uh you know if there is any upside available to do that. Uh that is point number one. 38:54 38 minutes, 54 seconds Point number two is on the uh dispersements. Uh our internal customer sourcing is approximately 50% of the 39:02 39 minutes, 2 seconds overall dispersals we do. Out of that approximately 60% actually comes from the branches through the branch 39:10 39 minutes, 10 seconds customers. So and we would like to uh we would see this actually growing uh going forward. uh there have been some 39:18 39 minutes, 18 seconds calibrated growth strategy on the unsecured loans and and now with the new uh you know rule engines and the new platform uh when we look at uh 39:27 39 minutes, 27 seconds increasing that share as well this would also uh result in increasing the contribution uh coming from the branches. 39:34 39 minutes, 34 seconds Uh on the on the third part uh when we look at a branch extension we typically look at uh three points. Uh one what is 39:42 39 minutes, 42 seconds the deposit growth happening in and around that pin code. Uh second one is how uh is the credit growth happening 39:50 39 minutes, 50 seconds and third is how the quality of uh credit growth uh available in and around that branch. So these are largely the three broader points uh we keep it in 39:58 39 minutes, 58 seconds mind uh while going for any uh selection of a branch location. 40:04 40 minutes, 4 seconds Got it. Got it. Uh that's helpful. Uh just one quick uh follow-up question on uh an earlier question uh asked on our 40:12 40 minutes, 12 seconds idea. Uh you did uh give out the rundown trajectory for the next uh one year. Uh 40:19 40 minutes, 19 seconds wanted to understand uh how uh the mix uh would look like after one year. Would the decline be sort of linear or uh 40:27 40 minutes, 27 seconds would it be uh uh accelerated uh post one year? Thanks. 40:34 40 minutes, 34 seconds So the the the reduction of RAF from here on will uh so for example FI 28 and 40:41 40 minutes, 41 seconds 29 will be equally split and then there are some maturities in 30. So I would say it starts getting um it starts 40:49 40 minutes, 49 seconds getting thinner in terms of the base of uh of production. So 28 will be similar to 27 potentially but 2930 will start getting thinner. 41:02 41 minutes, 2 seconds Okay, got it. Thanks. Thank you. That's it from my side. Thanks and all the rest. Thank you. 41:09 41 minutes, 9 seconds Thank you. Ladies and gentlemen, in order that the management is able to address questions from all participants in the queue, you are requested to please restrict yourselves to one 41:17 41 minutes, 17 seconds question only. You may rejoin the queue if you have further questions. 41:21 41 minutes, 21 seconds Our next question comes from the line of Dave Day from Horsepower Securities. Please go ahead. 41:28 41 minutes, 28 seconds Yes. Good evening, gentlemen. Mr. D, good evening sir. 41:34 41 minutes, 34 seconds Yes, good evening everyone and congratulation on excellent set of numbers. Thank you so much. 41:43 41 minutes, 43 seconds Yes. Uh it seems that the performance has been improving quarter on quarterf 41:49 41 minutes, 49 seconds and uh it's very pleasant to be part of your 41:56 41 minutes, 56 seconds uh story. So now my question is uh by the next year what is your target balance sheet size in terms of loan book? 42:09 42 minutes, 9 seconds Hello sir. Yeah. Hi. 42:12 42 minutes, 12 seconds Yes. In terms of loan book size what would be the target by the end of next year? 42:18 42 minutes, 18 seconds So sir we we've uh we've said we've not put out a specific numerical target. We said that we will want to uh have a 42:26 42 minutes, 26 seconds growth rate uh in line with the industry if not be better and that our expectation is that should be in the 13 to 15% range. 42:36 42 minutes, 36 seconds What percentage? I have missed it. Sorry. 13 to15 13. 42:41 42 minutes, 41 seconds Okay. Okay. Okay. Okay. And what would be the average targeted yield on the book? 42:49 42 minutes, 49 seconds So um for yield on advances sir that we've had as we look to exit March that has been uh about 9.2%. 42:59 42 minutes, 59 seconds 9.2. Okay. Okay. Okay. Okay. Okay. Okay. 43:08 43 minutes, 8 seconds Okay. Thank you. Thank you for sharing the details. Thank you for coming. 43:19 43 minutes, 19 seconds Thank you. Our next question is from the line of Rama Subaretti, an individual investor. Please go ahead. Uh am I audible sir? 43:29 43 minutes, 29 seconds You are audible. You may proceed. Yes. Yes. Yes. 43:32 43 minutes, 32 seconds Yeah. Uh good evening uh everyone. So happy congratulations uh Vai sir for the 43:38 43 minutes, 38 seconds becoming a new MD and CEO of SB and uh yeah the numbers have been very uh good 43:45 43 minutes, 45 seconds uh uh and u yeah the NPA asset quality and also like now deposits like uh uh 43:53 43 minutes, 53 seconds 2020 where we were and the 2026 it's like uh 3x growth uh very good and also like uh the profits also looking 44:01 44 minutes, 1 second promising like last year like whatever management needed that ROA we have exited with 1%. So uh basically my 44:08 44 minutes, 8 seconds question is like uh so uh this ROA like the uh I mean uh 27 and 28 29 um the uh 44:16 44 minutes, 16 seconds upcoming years. So uh I think we hope we maintain 1% uh ROA and also like on top of that uh uh uh that number will grow 44:25 44 minutes, 25 seconds quarteron quarter and yearly basis. uh can you uh uh describe on that uh so that we will have good confidence uh 44:33 44 minutes, 33 seconds whatever we built so far we will not lose the momentum. 44:38 44 minutes, 38 seconds No thank you very much sir and uh you know thank you for uh you know being quite supportive on the banks we really 44:45 44 minutes, 45 seconds value that thank you for that. Um on on the question on ROA uh we've we've said this uh that March 26 we will uh look to 44:55 44 minutes, 55 seconds exit with a 1% ROA and uh I did I did also allude to that in my previous response. I think most important thing 45:02 45 minutes, 2 seconds is now to sustain uh this 1% ROA. Of course there are there is uh there is a play that we also have from provision 45:10 45 minutes, 10 seconds right back of JC FLAR ARC. uh but what we have very uh emphatically worked upon internally is to say internal outside of 45:19 45 minutes, 19 seconds the JCL arc right packs we will look to improve our ROA um you know 25 to 50 basis points and it's a function of net 45:28 45 minutes, 28 seconds interest margin improvements is a function of you know making sure we discipline the cost and you know containing the credit cost as well. So 45:37 45 minutes, 37 seconds really that's our endeavor. U what what what you've said are exactly our uh our aspirations and our ambitions 45:44 45 minutes, 44 seconds as well uh to not only maintain but to improve uh over the next uh two to three years uh on the arrow. 45:54 45 minutes, 54 seconds Yeah. Uh thank you sir. And uh even this RAF is reduced now like earlier it was like 11% now it is significantly reduced 46:02 46 minutes, 2 seconds and uh I hope this uh I mean like uh RAF funds and also like uh it can improve the loan growth and all. So our minim 46:10 46 minutes, 10 seconds also like uh any target in the next year like to cross 3% or uh any guidance on that s like currently it is 2.7%. 46:19 46 minutes, 19 seconds So um uh on that sir we we we usually refrain from giving the near-term guidance. We said that uh structurally 46:28 46 minutes, 28 seconds over a threeyear period uh let's say now about 2 to three year period if we believe that we want to get into a 3.25 46:36 46 minutes, 36 seconds to 3 and a half% kind of a range uh on uh on on from a margin perspective. uh 46:43 46 minutes, 43 seconds and uh as you rightly pointed out uh our IDF is going to be an important important uh contributor to getting uh the net interest margins higher as well. 46:54 46 minutes, 54 seconds Um so that's really uh one uh one big driver. Second, we have to make sure that our um uh you know that our loan 47:02 47 minutes, 2 seconds spreads uh are quite disciplined and there's a lot of work that we've already done from a cost of funding standpoint. 47:09 47 minutes, 9 seconds Uh so if you look at our savings account rate uh over the last one year we've taken the benefit of uh this reducing 47:16 47 minutes, 16 seconds rate cycle to cut our rates by uh over 150 basis points. So you know savings account rates which was blended 6% is 47:24 47 minutes, 24 seconds now well below 4 and a half%. We've taken another rate action in April as well. So our objective is to also make 47:33 47 minutes, 33 seconds sure that uh we are focused on getting our cost of deposit which we believe is very core to a bank uh and its 47:41 47 minutes, 41 seconds liabilities to get that cost of deposit structure lowered as well. So not only our uh which anyways is on a bit of an 47:49 47 minutes, 49 seconds auto mode of rundown but work hard to also get the loan spreads improved uh through our cost of deposits and funding 47:57 47 minutes, 57 seconds as well. um uh you know that that we believe uh should help the margins. And last is uh as the retail growth is now 48:04 48 minutes, 4 seconds coming back uh and as the mix uh starts playing out on the loans as well um that 48:11 48 minutes, 11 seconds will also indeed help us uh improve uh the asset advantages and therefore start playing into our margins as well. So uh 48:19 48 minutes, 19 seconds you know we will work hard and you know to to make sure that we are driving each of these vectors um you know to uh the right direction. 48:28 48 minutes, 28 seconds Yeah. And last question is there any plan to please rejoin the queue if you have any further questions please. Okay. 48:36 48 minutes, 36 seconds Thank you. Our next question comes from the line of Amit Wharma an individual investor. Please go ahead. 48:43 48 minutes, 43 seconds Uh thank you for giving me the opportunity. Congratulations on maintaining the growth momentum of performance. This is heartening. Can you 48:51 48 minutes, 51 seconds give us an update on the ATI 81 bonds case and uh what do you think would be the impact on the balance sheet in the case of an adverse judgment? 49:04 49 minutes, 4 seconds Uh so on the 81 matter this matter is subjudice as you all know. Um the hearings uh have uh taken place at the 49:13 49 minutes, 13 seconds Supreme Court and uh the matter is also reserved for uh judgment. Uh we will we will wait to hear from uh you know the 49:22 49 minutes, 22 seconds Supreme Court honorable Supreme Court uh on the verdict and um you know we will make sure that we are also coming back 49:30 49 minutes, 30 seconds uh to all our stakeholders and updating them on what the outcome uh and its impact on the on the bank would be. I I 49:39 49 minutes, 39 seconds would I would refrain from asking a judgment on you know what we expect. Uh you know we stated this earlier as well. 49:47 49 minutes, 47 seconds Uh we do believe the actions we took uh were in line with uh the uh the contractual obligations and the 49:55 49 minutes, 55 seconds processes that were allowed. Uh but uh it is important that we respect the the proceedings of the court and allow the the judgment to play out. 50:06 50 minutes, 6 seconds Thank you. 50:09 50 minutes, 9 seconds Thank you. Our next question is from the line of Shriant from Sundalam Asset Management Company. Please go ahead. 50:19 50 minutes, 19 seconds Hi, am I audible? Yeah. Yes. Yes, please go ahead. 50:23 50 minutes, 23 seconds Hi. Firstly, congrats on an amazing result. I just want your quick view on the West Asia war and its impact on the inf segment given that it's one of your 50:33 50 minutes, 33 seconds key growth drivers. So, where do you see that? is still like planning to continue growing it and how do you factor the stress over there? 50:43 50 minutes, 43 seconds Sure. Thanks. So, uh we are proactively monitoring our portfolio and this is the exercise that we've already started. um 50:50 50 minutes, 50 seconds you know it's good to report that uh all our clients whether it's an MSME or larger clients u you know have been 50:58 50 minutes, 58 seconds managing well uh they have not not shown any signs of uh stress but this is a space that we will continue to watch uh 51:05 51 minutes, 5 seconds because it will have an impact on the inflation and there can be second order impact so we continue to uh uh you know uh monitor our portfolio closely and 51:14 51 minutes, 14 seconds talk to our clients to understand uh you know the impact and the actions uh that they're going to Okay. But currently u 51:22 51 minutes, 22 seconds you know since we have had a good client selections over the years all our clients have been able to manage this crisis better. 51:33 51 minutes, 33 seconds Okay. Perfect. Thank you so much. 51:35 51 minutes, 35 seconds You thank you ladies and gentlemen. We will take that as the last question for today. I would now like to hand the 51:43 51 minutes, 43 seconds conference over to Mr. Vine M Tonce for closing comments. Over to you sir. 51:48 51 minutes, 48 seconds Yeah. Thank you so much and uh I must place my sincere appreciation on record for all the esteemed analysts 51:56 51 minutes, 56 seconds who could make it today. I know it's of course it's a Saturday afternoon and also a very busy day because the other 52:04 52 minutes, 4 seconds two banks also that came in today. I appreciate your taking time off and then coming and joining us. Thank you very much. 52:15 52 minutes, 15 seconds 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.