Firstly, congratulations on taking over as the MD and CEO and within a week of your joining, your bank has posted a record profit of Rs 1350 crores. So tell us what has been the major contributors of the same this time around?
We had an operating profit of Rs 13300 crores plus on March 2023 which was as against Rs 9900 crores on March 2022. It was a healthy, robust growth which we had in our operating profit.As far as our net profits are concerned, we had a net profit of Rs 4023 crores to be exact. This is for the first time in the history of Bank of India, the annualised profit has touched Rs 4023 crores as against the backdrop of Rs 3405 crores as on March 2022.
So there also there has been a healthy growth as far as the net profit is concerned. So as you asked that what were the reasons, the basic reasons were the NIMs. NIMs were better for the bank and the growth was there, credit growth was there and we could also improve our costing and reduce our cost of deposits and other costs because of which the profitability improved for the bank overall.
Let us just talk about the strong 13% growth that we have seen in your advances during this quarter. In terms of the guidance for FY24, what can we expect from the advance growth, where do you see this heading now?
Gross advances increased by 12% plus in this financial year. The guidance we are giving again at around 11 to 12% for March 24 for the reason being that the base is now high and because of the high base, we are giving a muted guidance of around 11 to 12% and we are confident that we will be achieving that guidance for March 24.
Will you be able to bridge the gap that you are seeing between the credit growth and the deposit growth and what is your guidance for the deposit growth for the next year?
As far as this is concerned, this year our March 22 deposit was 627000 crore global deposit which we closed at 669000 crores for March 23. As far as the CASA percentage is concerned, we had a very robust 44.73 percentage of CASA. So there was a growth in CASA also in absolute numbers. So as far as bulk deposits are concerned, we constitute only 10% of our total term deposits as bulk deposit. All other deposits are all retail term deposits. The gap will not be much this year because we are trying to have a very healthy CD ratio, credit deposit ratio. So we are very much confident that whatever the resources are required for raising for the growth in advances, we will be raising it through our strong franchisee which is a 5100 plus branches of Bank of India. Another very important thing is that we have a very strong franchisee as far as the customer base is concerned. We have a 7 crore plus customer base and we are very much confident that whatever the resources which are required during this financial year to bring growth to the business that will be achieved.
What is your guidance for the deposit growth? Will you be able to bridge the gap? You have told about your deposit but with this you also have plans to improving your key ratios in terms of ROA and ROE, this particular fiscal. Talk to us about that. What are the numbers you are seeing for these two ratios?
As far as ROA is concerned, our ROA we closed for March 23 at 0.49 and the guidance for it would be 0.73 for financial year 2024. As far as the return on equity is concerned 10.31 was there as on March 2023 and we are giving a guidance of 13.30 for March 2024 which is again on a higher side, on a healthy side. What is the outlook in terms of the asset quality for the company then?
As far as the gross NPA percentage is concerned, we closed at 7.31 which is much lower than what the figure was in March 2022. And for the guidance purpose, it is 6.5% for March 2024 we are giving for the gross NPA.
As far as the net NPA is concerned, we closed at a healthy figure of 1.66 for March 23 which was again quite low compared to March 22.
For the guidance sake for March 24 we are giving a number of 1.30%. As far as the overall guidance is concerned on the asset quality, we are very comfortable and we are very confident in Bank of India that we will be able to address the asset quality issue and it would be go down further.
The recovery is happening very robustly in the system, cash recovery is there and some of the accounts which were there earlier NPA, their recovery has started and some OTS proposals also we are seeing here in the pipeline so that is one thing which is there.
Another part is that the advances will also grow that will also have a numerator and denominator effect as far as the gross and net NPA advances are concerned. So we see a very healthy figure as far as the asset quality is concerned and should not be an issue.