If we see that the slippage of EEB in this quarter, it's INR993 crores out of INRI ,390 crores. And I also mentioned on that point, the 45% of this amount of the slippage ofEEB has slipped in the month of October, where we migrated to new CBS followed by festival holidays. But if you go to the next month onwards, that it isn't so much on a month-on-month basis so low. We have not seen that last 2, 3 years that much of that. So it is -- has given the comfort to us, this has been come down. And second point, I also mentioned, whatever the portfolio we have shown that the EEB portfolio, which is disbursed in the FY24, so far, the portfolio quality, so good, it has been showing that NPA only 0.11 %.

Got it, sir. Sir, so just one clarification, that you expect the low slippage that you saw in November, December, to continue in the next few months also?

It will again come down on that.

The next question is from the line of Yuvraj Choudhary from Anand Rathi.

If you see that the prediction of that as the NIM, there is 2 parts. One part is the cost of fund. So whatever the cost of fund has been increased. I feel that it is a very good way has come on that. And as per the yesterday regulators, the prediction, so it cannot be like further like to grow. So that it will be -- if it isn't fixed on that, in the future, it will be again come down.

If you see that the opex asset ratio, we guided on that is at 3.5% for FY24. So ifwe see that in the first quarter, it was 3.5%, second quarter has come 3.7%. Again, the third quarter has come to the 3.6%. So we say that it will be like to continue in these lines. For future growth of the bank, it has to incur 2 type of cost. One cost has come operational. It will continue. We cannot reduce. But other cost is a capital cost, which is like to make as in every year -- book some of the cost on that, depreciation, whatever we say that. Sir, on margins, NIM was stable at 7 .2% on a sequential basis despite strong growth due to cost pressures. So could we see NIM at the same level in the near ter m? Or could we see some improvement in NIM? And second, my point on that -- whatever that the cost of the bank means on that that when the risk portfolio has come down, slippage has come down, automatically, it will be also help to the bank to better way to maintain on that. But I'm not very much say that it will be very long term can be like to say. But I say that this quarter, 7% to 7.5%, we can be like to do. And the March, we have it at the strategic meeting, we can analyse further on that. And again, we will be like to communicate to all of you on that what we can be like to pass on. But we have said that the same line will be like to continue. Sure, sir. And sir, last question would be, sir, some colour on our portfolio in Punjab would be helpful, like what would be our aim there, collection efficiency, if you can throw some colour on that.

So Punjab point of view, we have not very much more in the portfolio in here. And so we'll give the number -- a small portfolio, I can say that in that very -- INR 714 crores like on that, entire book, out of a total book of INR58,000 odd crores, INR714 is the Punjab portfolio.

Thank you. The next question is from the line ofMohit Jain from Tara Capital Partners.

Sir, I just wanted to understand on the slippage part because of the system migration. Sir, I believe we have this weekly collection model. So when this transition happened, what -- how did it exactly affect the slippage? Like was it like we did not have the group meeting for, let's say, a particular period of time? And just a related question, sir, overall the increase in GNPA is more than rest oflndia portfolio. I think in West Bengal and Assam it has come down. So is it also that the re-transition affected the collection in the other states and not the Eastern states where our focus was higher?

So there are two points, Mohit. One is that -- on 3 October, we migrated to the new system. Given that we are migrating on that day, that day we declared as a holiday. It means we wanted to ensure that the people are able to understand the system, which means that day was a collection holiday. But for our portfolio, it will keep moving the DPD. So for the pool, it will keep moving, that's one. Second, first few days, people got used to the new tab, new way of looking at the demand, and then go and collect it. So there are certain challenges in terms of understanding it, as much we try to train everyone. But slowly, they could quickly understand. Therefore, you see significant better November and even better in December. So that took some bit of a time. Third, of course, October, you had the festive. And you see there are a whole bunch of holidays, I think, 5 to 7 days holidays. Holidays for us and customers. But DPD doesn't have holidays, so that keeps moving. Those are the three broad factors.

And sir, the related part as to why the rest of the India had a higher GNPA and why we performed better in West Bengal and Assam?

No, if you see that the industry perspective, if you see the Maharashtra is an issue, and also partly also UP. So that is the two. And third, you -- specifically for us is Manipur. You know that the issue. So that is the MP also partly. What happened on that in the microcredit point of view, if you look on that, this is a group-based credit. And when the group-based credit is a need to group bonding in the meeting. After the pandemic, some states very quick they had recovered and coming to the group meeting attendance and also bonding very good. Some states, some pocket, they are taking more time. And those areas a little bit this slippage will happen like to be seen. So it will be improving by the month-on-month basis, we see that. And we are also taking very corrective measures, and we have a very separate team working on that. And very quick, we'll be like to come back on that.

Okay, sir. And sir, just one question, final. Do we foresee any impact from the upcoming elections that will be there on the disbursement all the collection, sir?

No. We have not seen on that.

The next question is from the line ofRitika Dua Dua from Bandhan AMC.

So firstly, you shared that going forward, the share of secured to unsecured would be 50-50. If you don't mind, just what is the number today?

Today, number is in secured is 44.5%, and the 55.5% is the unsecured.

Right. So sir, just telling you, we will have Santosh, a person, joining on the retail and the consumer side. I think it would be good to hear from you, sir, how are you looking to get to this journey of increasing, and what would be the focus areas?

Okay. I request Santosh Nair to address this question

Yes, sir. Thank you.

See the whole idea is like when I joined here, there's a clear chance like we want to stay focused on the affordable segment because we clearly see a demand in the affordable segment. The only way that we can do is probably get into more geographies, probably look at our internal sourcing and internal branches where we think we have a cross-sell opportunity, which we can -- we can explore, and also get into the digital way of lending across all the retail asset products and mortgages. So that way, we could surely see a progress towards what we mentioned and try to get it at 50%. It's early days for me now, but we have a strategy meet in the next week or 10 days post which we will take a collective decision on how we have to move forward.

Sir, just one more question, ifl could, request you to reiterate the long-term guidance which you have shared on the various growth and the ROA and ROE? Thank you. That's it for me.

And we are guided on that, ROA and ROE. We said that the 14% to 18% of ROE. And ROA, we are like to predict it on that, the 2.5% to 2.8%.

So Ritika Dua, we are having our strategy meet somewhere by end of February, right? So where we will discuss our next 3 years plan. And once we do that, after that, we will share with the market participants. So please allow us one quarter more to give you about our long-term plan.

Our next question is from the line of Saurabh Kumar from JP Morgan.

Sir, just two questions. One is the SMA. If you look at the total, 0 plus overdue book. That has gone up by INR470 crores quarter-on-quarter. I just want to know, is this your normal run rate? Because this book went up also by like INR230 crores in the second quarter, then about INRl,100 crores in the first quarter. So just in terms of the zero plus, how much -- how do you think this forward book, how does it flow through? Or should we think about the INR470 crores and INRS00 crores as a normal run rate from here on? Saurabh, I believe, considering the current situation and stringent underwriting norms, which we have adhered to, at least INR300 crores to INRS00 crores of addition, from zero to the DPDs, what we're expecting even for one or two quarters. And then we'll work out how the situation improves and then we'll let you know. But as of now, yes, for the next 1 or 2 quarters, yes, that's the run rate which we believe would continue. Okay. Helpful. And the second is just in terms of the savings account, I mean, can you just quantify how much of the -- I mean, how much of it would have been wholesale savings versus retail? Or is it all retail savings?

Only 5,000 is a wholesale sale, and then balance are the retail.

Okay. So that decline which is we are seeing quarter-on-quarter is the wholesale decline?

Our next question is from the line ofManish Shukla from Axis Capital.

On housing finance, slide number 13. Just curious what is driving the IBPC purchases? Because ifl look at the quarter, the quarter-on-quarter increase in IBPC purchases is almost same as the fresh disbursement in housing loans. So just curious what is driving the IBPC purchases.

No, if you see that the IBPC purchase, this is in -- good opportunities also to earn some revenue from this portfolio. So depending upon our liquidity and opportunity, we keep on adding or running off the IBPCs.

How will be the yield outcomes on the 2, IBPC purchases versus what you disburse annually?

I think 7.25%, ifwe need, we can add.

Okay. Moving on the liabilities. Can you share the average cost of your SA deposits?

It will be slightly over 5. Give us some seconds ...

5.16.

Okay. So if you look at liabilities mix, right, the bulk of the liability growth seems to be coming from non-retail TD, which I'm assuming only more expensive than retail TD. So in that context, I'm just trying to understand the balance sheet growth strategy. So between growth and margin, how do you look at it? Are you comfortable growing your balance sheet and funding it by a non­ retail TD and keeping margins where it is? Or would you look at slowing growth and improving on Margins?

So I'll take that. So our -- the deposit strategy has always been focused on retail term deposits. While there are opportunities on the wholesale piece also, whenever we have found opportunities, we've taken them. And we have been very circumspect in taking clients on the wholesale front. However, the retail focus continues. And if you see the growth that we've seen on a Y-o-Y basis on a retail term deposit has been around 25%. That's reasonable growth, and that focus continues.

I was talking more from a sequential growth perspective, December over September, because that is when you've seen loan growth for you after 6 months. Yes. So we grew about 6% quarter-on-quarter. And that was funded primarily by non-retail TD?

No. On the retail TD bid, we grew by 6%. And of course, the overall TD growth that you see, the rest of it was wholesale.

Sir, my first question is on the margins. The credit to deposit ratio improved 300 basis points sequentially. And still margins were stable. So had it not been for the liquidity? Is it fair to assume that margins would have declined?

If you see that the -- of course, it is another side of this, we need to like to go to the increase that -- decrease the CD ratio cost will increase. But we see that there are two others. First thing is the quality of the portfolio, it will be like to help reduce the cost. And second point on that, whatever the rate is today, and that rate also in the future will be not long run, that will be also cost of fund will come down. That will be like to balance gradually.

Can we increase CD ratio further. It is at 93%? So can this be further increased from here on?

So if you see that the CD ratio last 5 years, we are reduced CS ratio from 127%. Now it has come less than 100%, which is 98% on gross advances. So every year we have been reduced in the 5% and more or less around all that. So we have very strategic plan on that, how it can be like to make it in a good way and to maintain the other all ratios.

Okay. My next question will be on this mix of secured versus unsecured. So you have been guiding that we are moving more towards the secured side. So with that, the implication yield on advance should be on the downward side, isn't that? So structurally, our yield on advances will only come down as we raise the share of secured in our mix. Is that the right assumption?

Assumption is right. As we said that we will maintain -- so as of now, our yield and cost of deposits are moving almost in tandem, and therefore, you see that we are actually maintaining 7.2%. We said that we will maintain 7%, 7.5%. But we have our strategy meeting. We will go back and go to the drawing board and really look at all parameters, balancing all the metrics that you want to target and come back with a detailed plan, whether we would like to compromise on some part of the NIM, et cetera, we will come back. But the truth is that, as of now, we are -- even our retail book, 66% is secured. And those are generally high-yield products. We are focusing on some of those. Like Santosh mentioned, my colleague, that we are focusing on affordable yield significantly higher than, let's say, prime segment. So our focus will continue to be not compromise NIM beyond the point.

Okay. But any this secured retail will be lower than the MFI leads.

That's true.

Okay. And sir, one data, housekeeping question. What will be the differential between non-retail term deposits and retail term deposits?

100 basis points.

Okay. Sir, second question will be on these branches, I just want to understand what are the nature of these branches? Because branch count on a Y-o-Y basis has increased by 30%, but other expenses are virtually flat. So our OpEx per branch has come down significantly. So what are these branches? Where we are carrying this amount of savings?

Moderator

So the branches are actually the standard general banking branches where we garner starting with deposits, and then do cross-sell to the internal customers. So these are pretty much standard branches. And you see our -- some part of the cost on even people we are deploying so that we can set up our new branches. So this is generally frontloaded, to add more people. Also in the retail portfolio and the housing portfolio, we're adding more people? The size and the shape of branches haven't changed? Not really, not really. But then why ... When you go to the new market, the first branch is generally a standard branch. When you look at the second and third branch, we may wish to compromise on the size and scale of those branches. But generally, the first branch, first few branches, we are keeping it as a standard. Our next question is from the line of Jai Mundra from ICICI Securities. Sir, how much is the LCR for the quarter ended? Liquidity coverage ratio, for the bank? 142%.

And sir, in that context -- sorry. Now -- I think someone had asked earlier also. But if you see this quarter, I mean fourth quarter is supposed to be seasonally good in ter ms of AUM growth. This quarter, the growth has also revived. Now, I believe the growth should be even higher next quarter, going by the seasonality. Could that be constrained by growth in the retail term deposits? Because this quarter, retail to total deposits on a quarter-to-quarter basis, that number has come down from 74% to 71 %. The deposit growth is mainly funded by nonretail ter m deposit. Considering what we have been hearing in the media and about RBI stance and in general tight liquidity, do you think this can impact the fourth quarter, otherwise, super strong growth seasonally that we see in a usual fourth quarter?

So the fourth quarter, also, the momentum that we have managed to build over the last 9-odd months ofretail ter m deposits is expected to continue. However, having said that, opportunities that I mentioned earlier on the wholesale front will also be leveraged. And as mentioned earlier, the bank will pick up deposits, and deposits, be it retail or wholesale, it will continue to leverage opportunities that are available.

Okay. Understood. So there is, as of now, there is no -- you are more or less indifferent as far as growth happens, either it comes through retail deposits or wholesale deposits. As of now, we are not overly worried that can constrain that near-term growth.

Sure. And last data-keeping question, sir. If you have the recovery number in EEB for this quarter. I think last quarter, it was INR130 crores. And the total provisions I think including standard, non-standard and everything were, and also the EEB or for the entire bank.

Total provision of the bank on P&L, INR600 crores, is aligned with the first quarter, second quarter, third quarter. All quarters around INR600 crores as a provision. But if you say that the recovery from EEB, INRI 78 crores, which was in the last quarter, INRI 39 crores.

The next question is from the line of Sameer Bhise from JM Financial. Please go ahead.

Is it fair to assume that in terms of ARC sales, we are largely done in the near term? Or do you think there could be some more for 4Q?

We have not yet planned on that. Ifwe have the plan, then we would like to inform.

Okay. And secondly, in terms of margins, while you said that we are incrementally into secured retail, which are slightly higher yielding products. But three years out, how do you see from your structural perspective?

We'll come back on that, Sameer. Post our strategy meet.

The next question is from the line ofKunal Shah from Citigroup. Please go ahead.

Yes. Just wanted to check in terms of what would be the cost of bulk deposits that we raised during the quarter? And was it like more towards the end and we are not seeing the impact in terms of the overall cost of deposits?

Yes, the cost of funds, as I mentioned on the savings rate that actually last quarter we have seen a decline from 5.17 to 5.06.

No, cost of bulk deposits? Bulk ..

I'm just coming to that. I'm just coming to that. So overall, TD cost have, of course, increased. It has increased about 7.4% the overall cost of funds on the TD front. Of course, the bulk rates have, if you would be aware, have hit a higher number. And the cost that will come in, of course, will impact in the next 3 or 4 quarters also. So, yes.

Slightly higher than 8%.

Okay, higher than 8%?

Slightly.

Around 8%, 8.1 %

Okay. Okay. Got it. And secondly, maybe I'm not sure if you highlighted in terms of when this migration issue would correct. So would we see whatever incremental slippages we saw 2 months back, when do we see them coming back in the rest oflndia, GNP as we started at 8-odd percent. When do we see that stabilizing? How much time would that actually take?

Yes, as we said, post October, November has been -- in the entire slippage that you see in the last quarter, 45% came in only October. November has been significantly better than October, and December is the best across last 16 quarters. So it's already back from the slippages perspective.

I'm saying whatever has slipped, how could it course correct? Yes. I'm not asking about the incremental one. But if you look at October slippages, which were there, when would it course correct?

The recovery. You are talking about the recovery?

Yes.

So recovery rates have been higher than the last 2 months. For example, last quarter, INR139, this quarter 178, and we are seeing.

And first quarter, it was INR81 crores.

So first quarter was INR81 crores, second quarter INRl39 crores, last quarter INRI 78 crores, and we clearly see that uptick also in Jan and Feb.

Okay. Okay. So by March, we should see that normalize.

We expect it on that.

The next question is from the line of Punit Bahlani from Macquarie Research.

First one is this quarter we had an ARC sale. So just wanted to understand the accounting for that. Like the way I understand is we have provided up to like 50%-60% for that, and the remaining is to be taken on the part of other income? Am I right? Or just wanted to get a -­ because in the disclosures, there is nothing related to the ARC income. So just wanted to confirm for this quarter.

So the ARC, the total portfolio was INR 720 crores, and at the time of sale, so whatever the carrying amount of provision was INR352 crores. And that, we have -- the additional provision that was required that was stated at the time of the sale. And the overall transaction is a PL neutral transaction. Okay. Okay. So then this quarter, we'll see the additional INR350 crores provisions that you created during the time of the sale. And then you have .... So that was already there in my books, adjusted at the time of sale of the assets. And second bit, on the Stress Pool bit, now we're seeing that, because of the migration to the core banking system, we have incrementals. But just going forward, should I see this Stress Pool -- should I expect this Stress Pool to decline, which has gone up, like, say, from INR55 billion to like INR 75 billion over the coming quarters, should I expect this to decline? What's your -­ because it seems like there are -- the forward flows keep on happening every quarter despite all these things. Any comment on that?

What we say that, that is we seen. But, as of now, in an EEB portfolio, total slippage percentage -- DPD percentage is coming for that is in 3.4%. And we saw that whatever the amount have at the slippage in there, there have been 60% recovered and 40% slippage to NPI. In that sense, we are calculate on that.

Got it, sir. The next question is from the line of Prakhar Agarwal from Elara Capital. Three questions. One, when you talk about slippage due to the migration, can you help me understand why would it not recover? Because you probably took time to paying the staff, but if there are not underlying cash flow problems with the customer, why should the recovery take more than 2 months for that portfolio?

So what we see that, is the group loan, and mainly, it is a weekly based. And there is the first point on that. The weekly, when it happens second week, we are not able to keep the double installment to all of the customers. So this is the main point on that. And the second point on that, they are normally practiced and behave on that. They are paying this amount in the last installment. When they close the loan in the last installment like in the 50th number of weeks, and that day they are given to wither in the two. So that is the normal practice on that. And our system is not doing in there -- that is not -- they're not know that. But I hope that they are also recovering coming on that. And of course, it will be coming -- reducing on that after that. So that if you see November, December, it has been come down, drastically, on that.

So in addition to Mr. Ghosh. So when the customers are falling to NPA because of this migration issue, these customers are marginal customers. So those are the 80 days DPD. The moment customer goes in -- cross this 91 days DPD, even if he pays the 2 installment back to me, so he will come back at the DPD of 80, but he will remain stamped as NPA since -- once he starts to NP A. So entire amount needs to be recovered from the customer to bring the customer out of NPA. No, I understand that part, but then your recovery numbers should also have been higher, right? So irrespective of the fact that you have the full payment of 2 months, but then your recovery amount should have been higher even ifwe think is one EMI.

So my recovery number has been increased from INR139 crores to INRI 78 crores this quarter.

Second, in terms of the fee, if I were to look at 2, 3 line items, if I were to look at your third­ party income that has come down a significant rate, I'm talking about from a trend perspective. Can you also help me understand what are these card charges which is moved from Q 1, if you look at QI to Q2, that number has essentially doubled? What are essentially the nature of these card charges and the others, which is around INRI 76-odd crores? If you look at these three line item other income, can you help me understand what is happening there?

Give us a couple of seconds. So if you see that we are revised our group insurance policy to the customer. So earlier, we have given that the mandatory to the all customers as they insure it, that time premium has come on that. Now we have decided on that, everyone sometimes is not needed to the insurance. So after the taken loan, and they are -- we offer them then who are interested, they are coming. So during this period, so a little bit just change some of the systems and the process. And that will be taken some time not to come on that amount in that third-party product. And it will be gradually coming on that, and it will be like the bigger way the people will get the services of insurance with all the compliance with the regulation. On the card charges, now with post core banking migration that we have done, we have an ability to adequately and appropriately charge debit card customers. We have certain slippage gaps in that area. So now we have a better ability to collect the exact charges, compute it exactly. And that's why the numbers are slightly better.

Okay. And just last one, others, what is exactly the difference between the two?

Others is that one-off, which is INR400 crores in the last year, similar quarter, same quarter, there is an ARC sale, one-off income. That is not there.

Lastly, on management changes of -- while you highlighted that you've onboarded couple of guys and they will join in. But if you look at on the other hand, there has been guys that's been leaving and probably that trend seems to have not halted. What do you think exactly the reason for that? And when do you think it probably settles down. Because every now and then we keep on layering that there is some or the other movements that is happening. So what do you anticipate the reason to be? And how will you see this settling down?

If you see that the -- compared to the last financial year, last to last financial year, we are more stable on that. Yes, I, 2 have left, and that is bigger opportunities has got by them. And it has been also -- of course, it is not expected on that, but a very good number of team members also has joined to the bank for future way to grow and reach to bank the goal. So I am not -- I'm feeling that they're comfort on that, very strong team now in the bank to running this bank on that.

The next question is from the line ofYuvraj Choudhary from Anand Rathi.

No, no. It's not that. The scheme provides for the fact that a borrower has to become NPA, and stay NPA for 6 months, within the 3-year period of taking the insurance cover. In our case, 85% borrowers have normally paid and closed their debt, therefore, they never came to the NPA pool. Or they have come to NP A, but not stayed for 6 months. Therefore, we didn't need to claim for that. Practically, that's what it means. So the scheme say it 15%, but ours is roughly around 11- odd percent. The last question for today is from the line of Mahruk Adajania from Nuvama. Thank you for allowing me to come back again in the queue. So I just wanted to know what would be the slippage from SMA 2 into EEB NP A this quarter?

Give I, 2 minutes on that.

Mahrukh, I will get in touch with you on this one. Currently, I don't think we have that number.

We're not handy on this number, I'd like to get back to you.

Ladies and gentlemen, that brings us to the end of the question-and-answer session. As there are no further questions, I would now like to hand the conference over to the management for closing comments.

Thank you. Thank you so much for participating in the teleconference.

Thank you to all of you. Thank you to participate and give your valuable time. Keep confidence on us. We'll be always with you all. Thank you.