Yes Bank Limited analyst Q&A

So, I just want to know is there anything in future for the AT1 bonds, any provisions to be made?

Deepak I think this issue has been discussed in detail earlier and at this point of time since the matter is pending in the Honorable Supreme Court, we would not like to make any comment on this.

Is there any provisioning to be made on that sir?

What I am saying is that the entire clarification on this part has been done, but at this point of time, to make an argument, why there is no need to make a provision, would not be correct as the matter is pending in the Honorable Supreme Court.

Thank you. The next question is from the line of Amey, an Individual Investor. Please go ahead.

Just a quick follow up question on AT1, do we know when is the next date in the Supreme Court and how do we know when is the date, in fact I try to know, but I don't find a way to figure out when is the next date?

Actually, this was slated to appear today, but it has not come in the final listing as of date and I think we would come to know from the registry of the Honorable Supreme Court when it will come on the next date.

Thank you. The next question is from the line of M B Mahesh from Kotak Securities. Please go ahead.

Two questions from my side sir. The first one is on the Cost of Funds the increase has been for this quarter relatively smaller as compared to the last two quarters. If you could just tell us at your portfolio level given the kind of maturity that you're seeing in your term deposits, how are you seeing the Cost of Funds kind of moving over the next couple of quarters ? This is the first question. The second question pertains to the slippages that we are seeing on the r etail portfolio - this quarter has been on the higher side. If you could just kind of give us a context into what is driving these retail slippages?

On the Cost of Funding to the first question that you asked, Mahesh, if you'll recall we've been saying that the bulk of the repricing I think has been absorbed till September and since then at least in terms of what we are observing as a pendency in deposit re pricing we're looking at not any material impact over the next one or two quarters. Having said that Mahesh, what we also are conscious about are the industry and the liquidity landscape- could mean that there could be room for us to continue to work on rates, although our conscious effort is relative to the industry, we need to keep performing better relative to the industry. But as of now, when we look at the repricing or pendency of portfolio there is a very minimalistic impact from a TD repricing on Cost of Funding.

Just to add on this question, let's say in the month of January so far the situation on the deposit mobilization has been at par to last quarter worsened or it has improved w here would you kind of put this situation today?

At an effort level, I have to say efforts are higher for mobilizing the deposits that we would have otherwise take, but from our perspective it is th e momentum in Jan continues to be similar to what we typically observe around this time of the year.

The second question on the retail slippages?

So, on the retail slippages obviously there has been little bit of concern in the last couple of quarters brewing. So, we took some measures in terms of the revision in the scorecards , BREs, also in terms of I think the credit process. So, I would say that more or less we have now reached a plateau and from there we see that in the coming quarter we will see this getting in a stable state. But good part is that bucket -by-bucket there is an improvement in the resolution. So , we see a better resolution in the coming quarters from this level. So, our expectation is that the slippages will continue for one or two quarters it will not rise from here and then it will start declining.

Sir, just to understand what is driving these slippages which part of the product portfolio within retail?

So, largely the unsecured assets and also some of these segments few here and there, but those were minor, b ut largely we have seen that the unsecured portfolio needed a lot of c orrections and very timely corrections which have actually happened and now it's showing the results.

Thank you. The next question is from the line of Sri Karthik Velamakanni from Investec. Please go ahead.

Question on the risk weight asset s - you have not disclosed the number, could you 1) disclose it, 2) walk us through the movement to CET1 today this quarter particularly in the context of the DTA unwind and the consumption due to unsecured risk weight increases?

So, the risk weight number is about INR 2.7 trillion, which was about INR 2.58 trillion in the previous quarter. So, we had about INR 12,000 - 12,500 crores of increase in the risk weighted assets. Almost INR 7,800 crores did come in from the new RBI circular. Now if I were to just split this from capital consumption like Prashant also mentioned in his opening remarks, we had ~ 40 basis point of burn that came in because of the new RBI Circular. Outside of that, we had about a net 10 basis points of consumption which was a function of both growth that we had as well as the profitability, the DTA and some amount of continuous work that we keep doing on the rating profile plus like retail portfolio comin g to, a combination of that w e had at 10 basis points of net consumption, but both profits and DTA release would be ~ 20 basis points, of that book.

And the 10-bps declined due to the PSL shortfall is an implied profitability hit, is it, Niranjan?

No, it’s just if you look at the balances increase that we've had about in net INR 10,000 crores of increase in the PSL shortfall deposits between September and December quarter and as a consequence we also end up allocating capital on that because it does attract Risk Weighted Assets. So, it's a function of that.

So, despite sovereign guaranteed in nature there is capital hit also due to PSL?

That’s right Karthik absolutely.

The other question in our CA and SA growth. So, generally I think it was part of your opening remarks also that the CASA growth has been faster than system and I see that the branch additions have not been that high what's contributing to this the higher CASA growth relative to our estimate?

So, Karthik from our vantage point so there are there are two things really. One for us we are operating at a 29.7% of CASA ratio. So, we clearly have a priority to continue to im prove our both current account and savings account - number one. Number two, when therefor e we look at an execution plan clearly there is a higher amount of focus that is given to mobilizing the current account and savings account. Number three is we are looking at loan growth which has been in the range of ~ 13% and as a consequence we are also looking at a deposit growth of 15 % - 16%. In that context, we do find that delivering a growth of CASA which is higher than our deposit growth is something which we are all working towards. So, it's a very focused execution plan and consequence of those execution plans are discipline around productivity efficiencies at the branch level, monitoring profitability of each and every branch, making sure the incentive structures are rightly aligned not only for just acquiring customers, but making sure that they maintain balances over the M3 M6 period as well. So, it's a function and culmination of all of those elements which we've been investing over the last two to three years - we are finding outcomes of those and we're quite actually satisfied that I know ~29.5% is not a very high CASA ratio, but we are quite satisfied that a lot of the SA that is also coming through, if I just look at over the last one year , it's not that our blended SA rate would have actually increased. So, it's not that we are throwing rates to acquire the savings account. It's a function of very hard-core execution in retail to drive the balances.

Thank you. The next question is from the line of Mahrukh Adajania from Nuvama. Please go ahead.

I have two questions. The first is on Personal Loans that was discussed a bit. So, why were tightening measures required in P ersonal Loans? What was your ticket size - most of it would be salaried. So, what was your ticket size and in general is there some read through for the sector on that bit? And secondly, on just the realization of Security Receipt I know it happens as and when, but is there any path you can guide us to build better estimates?

Now first comment on the first que stion on the Personal Loans . So, our average ticket size remains around INR 2.5 lakhs. However, the segments which were a topic of concern for the entire industry were - one was the NTC , the New-to-Credit which was contributing to almost 25% of the industry debt position. I think which was showing a very good behavior for two years started showing some stress. So, at our industry level there is a concern and there is a cut on that particular segment. The second one obviously is where the income levels were less than INR 30,000 a month. So , these are the two segments which have been cut and this is not just for us, but this is at our industry level. So, having said that I think most of the concerns which we have tried to capture and try to bring the portfolio back on track are around these two segments.

And on the realization of SR?

So, basically when we started like when this transaction happened, we had the Security Receipts of INR 8,853 crores on gross basis which has already come down to INR 6,393 crores in one year. So, fundamentally if you see out of INR 8,853 crores almost INR 2,500 crores have been redeemed. Very, very difficult to predict when the remaining Security Receipts would be realized. But I think with the track record, we have not seen in one year , more than 25% of the Security Receipts have been redeemed and actually we have also seen the recoveries over and above the Security Receipts. And if you see the other part , we are continuously making the provisions on the remaining Security Receipts and today the Net Carrying Value of Security Receipt has come down to 0.8% and our Provision Coverage Ratio on the Security Receipt is 73.2 %. Our objective is to bring down the Net NPA + the Net Carrying Value of Security Receipts to below 1% in the next few quarters.

Sir, just one more question I know that your LDR has kind of stood steady, but in general in the whole debate on LDR for the industry where you think you stand because in general for everyone it appears that now LDR's need to come down. Do you think that that's the case for you as well?

So, Mahrukh, we are quite happy with the LDR of around 90% and this 90% is important for us in terms of both profitability a s well as keeping those kinds of margins , but if you see that we are continuously focusing on the deposit growth, higher than the loan growth. So, at no point of time we are allowing our LDR to go below 90 %. It means higher rather than 90% and going forward also our strategy would be continuously deposit growth higher than the loan growth, but 90% for us it's quite satisfactory especially when you see very large amount is being parked in the RIDF to take care of our shortfall in the PSL. So, today 11% of our Total Assets are sitting actually in the RIDF. I think if you take into account this part then 90% LDR is quite satisfactory.

So, this is something that even the regulator would be comfortable with because there is now a sudden talk that the regulator may not be comfortable with LDR's of some banks, not specifically yours, but some banks that's why asking?

Yes.

Thank you. The next question is from the line of Chintan Shah from ICICI Securities. Please go ahead.

So, sir firstly on these unsecured fees , that we are seeing a kind of some high slippages in the retail segment. So, as you clearly mentioned that is largely from the new-to-credit customer and not from the existing customer base. So, usually means just wanted to understand the underwriting which we are doing so that there is no concern on that on the CIBIL score or on the based on the past track record of your underwriting. So, that should be okay and only this is from the new-to-credit where the stress is coming up. Is that a fair assumption?

The retail business which you fully understand goes through its own cycles over a span of 5 years to 6 years and whenever there are any signs of stress appearing the foll owing actions are usually taken. One to take the entry scores up , to tighten the criteria a round the income levels and FOIR, and third one is to look at the customers where you have a limited understanding. Your internal customers will always behave better because not just y ou have information on their scores, but you also have information on their transaction history. So, that will always make more stronger and they will always behave on a relative scale better. The concern always will be the N ew-to-Bank customers and within N ew-to-Bank, the new segment which income bands you want to purchase or where do you see stress you kind of again dissected between the credit scores and then Bureau scores a nd then you again segmented between the profiles, the locations, the demographics. So, you get into full detail when you have to review to tighten the criteria. So, I would say instead of and what I alluded, to was some of the segments which largely have shown signs of stress, but whenever you get into this cycle and I would not say that we are actually into the cycle, but there was a bit of correction required at the industry level and in line with that we have taken actions across this. So, it is not just cutting one segment you have to take multiple actions to control and fortunately the signs are quickly seen in terms of your New-to-Bank population which is coming into as an inflow to the Bank. So, that is a positive sign.

And sir usually the FOIR for this below 30 k customers would be where there is some stress. So, what will be the FOIR for that 40%, 50% or even more than that?

So, today it is not as simple as it used to be a couple of years back. Today you segme nt the customer and then decide, (for a customer working with) Cat-A company or Cat-B company or a Cat-C company would all have a different approach to underwrite. So, I would say there are multiple factors which is a fo r sophisticated scorecard which today is applied as compared to the erstwhile file. So, this is I would say the tightening on various fronts not just the income to the loan ratio, but to the E MI ratio, but also to the thresholds of what is your entry level for income even that is into the consideration including putting the Cat-A, Cat- B categorization of the company from where the employee comes.

Secondly on that profitability part thanks for that for the levers, the improvement in profitability. So, we have ment ioned that increase on organic PSL. So, there were some talks earlier of acquisition, some inorganic acquisition to boost PSL. So, is that still on are we still working towards that and on the PSL so firstly it is on that and then I will come to the last question?

Yes, there is work happening to find ways to accelerate the PSL journey for us, but having said that clearly when you look at creating or acquisitions it obviously is time consuming. You need to have the right fits and there are multiple criter ia that go into the evaluation. So, it does take time, but I think having said that I think it’s important to note that it’s not that we are just waiting for that lever to express itself in our balance sheet. We continue to work on o ur own organic channels, we c ontinue to work on other means of inorganic acquisitions into the balance sheet for complying with the PSL and again I will again refer to Prashant opening remarks where he said that if you look at our problem in PSL which is in sub categories of Small and Marginal Farmers, Non-Corporate Farmers and Weaker Section -across these three sub categories if you look at our compliance to PSL we h ave only been improving quarter-on-quarter and it’s actually part of our presentation as well. So, it’s not that we are just waiting for this inorganic acquisition as a lever to come in and express itself. Yes, it will further propel a nd accelerate the acquisition machinery, b ut having said that we are now looking at very nominal numbers of non-compliance in Fiscal’24 across these subcategories.

And sir one lastly is that 1% RoA mark aspiration so do we envisage th at to come in FY 25 or probably in FY26 what could be the rough timeline, any sense on that?

I think that we need to be very realistic, and I think one of the big drags on our profitability is 11% of our assets sitting in the RIDF. Though we are working very hard, and we are quite confident that this year there will not be any shortfall in the PSL, but I think the PSL book coming down to a normalized level would take som e time and I think this is the biggest drag . So, 1% RoA we don’t see happening in FY25, but I think the way we are executing our strategy we may see this 1% RoA in FY26.

And then if I also add to that , see 1% ROA for us is very important from the perspective of getting it delivered through core operating profits and you would have seen that we continue to have good momentum resolution P&L write back to the S ecurity Receipts portfolio, but you would appreciate that what we have been doi ng very consciously is actually using that to keep reducing the drag on our Security Receipts and continue to work on improving the PCR right. So, I think just to mention that ROA 1% target is being thought about from a core operation and not just for a number from a profitability because ultimately, we want to get our NNPA and SR also below 1% from the recoveries of the SRs.

Thank you. The next question is from the line of Dinesh Jain, an Individual Investor . Please go ahead.

So, my two questions on basically every quarter you guys are disbursing about INR 30,000 crore of loan and in annual report also you ’re disclosing that you have about INR 1,00,000 crore of disbursement in a particular year which amounts to 50% of your portfolio. So, despite doing that, your growth is at about 15%. So, it means is it your average loan size is somewhere about 2 years or something like that why it is not translating it into the growth that’s point number one. Point number two is in the provisions on this time the default on Personal Loan is about INR 1,000 crore. Your total Net Interest Income for the year is INR 2,000 crores. So, if 50% of your portfolio is towards Personal Loan which is about INR 1,000 crore and your defaults are INR 1,000 crores in a quarter, does it mean that 100% of your Personal Loan net interest income is getting defaulted? So, is it something bigger underlying thing is there which we are not understanding or is it the earlier YES Bank which is returning now to the fore?

Dinesh ji on the first question of disbursement s so when disbursements happen there are also repayments that keep happening in the book. So, I will give an example of the Large Corporate Business where clearly we have pivoted aw ay from the kind of L arge Corporate Business that we should do prior to March ’20 this is more working capital transactional in nature. And yes, we do have a significant amount of fresh disbursement, fresh lines that get set up, yes utilizations could have its motions of some quarter, the utilizations are higher, some quarters utilizations are low, but I think the momentum on new business acquisition is very high. But having said that, in the Large Corporate book despite the new disbursement and you would have also observed that we do have, we have seen degrowth in that book over the last two years to three years that’s because of our legacy book that we had in the Large Corporate. We've seen the repayments a lot of those we were consciously triggering those exits so that we continue to reduce the legacy assets that we have in our Balance Sheet. It was also one of the strategies for us to reduce those ex posures because they were also coming in from let ’s say real estate or hospitality. So, that journey also coincided with the new acquisitions that were happening in the L arge Corporate and as a result what you see is net function on the loan growth that’s number one. Number two is if you look at similar comparison on the retail side on retail what we are seeing is a disbursement run rate of about anywhere between INR 10,000 crores to INR 12,000 crores let’s say that we might be doing per quarter, but equally we would be having about INR 6, 000 to INR 7,000 crores of let’s say repayments and maturities that happen every quarter. So, what again you see as a net result is pushed the repayment. So, what we are seeing is 13 % to 15% loan growth I think is fairly reflective of new business origination as well as old. The last point I wanted to make i s when we look at disbursements it ’s about making sure that you are penetrating into the relationship of clients. What we are quite confident about is that now that we are entering and acquiring large scale customers across when I say large scale customers across Corporate, Mid Corporates and MSME we have a good hook now on these custome rs and as and when utilizations pick up you would also start seeing those on the loan growth. I think that ’s just a simple explanation. I thought I should provide that was the first part of the question. I think the second questi on you asked was on provisions and NII which we have about INR 2,000 crores of NII, and I think the question was you were correlating that with INR 1,000 crores of slippages. So, the first point there is , when you look at the NI I, we are looking at NII also has multiple elements of drag, and I think we spoke about Prashant mentioning again and again that there is a significant drag coming in from the existing stock of our RIDF which is sitting today at about in excess of INR 40,000 crores on our balance sheet, 11% of the Total Assets. So, I just want to contextualize that INR 2,000 Crs is in the first place not in normalized run rate of NII that we should be looking at t hat’s number one. Number two is like Rajan mentioned when you look at a INR 1,000 crores of slippages you do go through cycles where there will be certain uptick in performance or delinquencies in certain products, in certain geographies, in certain segments, but I think that is where management intervention comes in , to say have you identified the p roblem and ha ve you taken course corrective action to make sure that incrementally you are kind of not repeating those geographies from a disbursement perspective. And I think we’re quite pleased to see that we have taken the necessary actions to plug the new slippages and like Rajan mentioned we do believe that the run -rate should start normalizing or reducing from here on. I think the third thing which you also have to look at is it’s not just the gross slippages. There is also a run r ate of recoveries and upgrades that we see. So , while for the full Bank if my annualized Slippage Ratio is let’s say 2.3% actually the net of recoveries and upgrades the ratio would be about 1.1%. So, it’s not that the whole block of 2.3% goes into a loss. T here are recoveries and upgrades that do happen over a period of time. The last part I wanted to mention is again while the impact of this, was acute in September, but we did see some element of that also play out in December is we also had an accounting policy change where and we did go through some explanation in the last quarter. So, I’m not going to spend a whole lot of time, but that meant that because of the accounting change in penal interest that delinquency was slightly higher on the retail book, but as to summarize we do believe that the relevant course-corrective actions have been taken and the delinquencies s hould start stabilizing to reduce from here on.

One last point I wanted to say on this whole priority sector thing a nd all which suddenly got popped up into this particular slide. So, were you guys not aware last 3 - 4 years that this particular thing is, you didn’t see it coming and suddenly this has popped up this particula r quarter or you were knowing 3 years, 4 years b ack and you were working on it and nothing happened and therefore this quarter it has popped up that this has become a now a new rea son on the block?

So, Dinesh ji , if you go back to our commentary also about a year back, we did mention that we are keenly evaluating acquisition of an MFI entity or e ntities that might be the MFI business. This was all keeping in mind that the Bank needed to solve its P SL subcategory acquisitions side. So, we were aware, we have been talking about the drag that RIDF is causing i t’s just that we have brought that out explicitly so that because we were getting these questions time and again and we were explaining on calls through a commentary. I thought it was just important that as an entity we put that out in absolute clarity as to what would be the drivers on improving the PSL drag and what is the drag. So, we just put that out in black and white that's the only difference. It's not that we were not aware nor that we have not been guid ing as to whether this is the problem statement for us or not.

Thank you. The next question is from the line of Narendra Porwal an Individual Investor. Please go ahead.

Sir my question would be for CASA sir you have already answered that, but our CASA till now compared to other banks it is growing very less and my opinion is that my account is already with YES Bank, but at this time many IPOs are coming and many HNI investors apply IPOs aggressively and they are maintaining balances, but still in our Bank cut off time is at 3 o’clock, but in other Bank it is at 4 o’clock. Sir why are we not becoming aggressive in compared to other banks. They are very aggressively doing the marketing that we are giving 7%, 6% and we are also giving 6% saving account we are giving interest, but in spite that our CASA is not increasing the way it should and in some way we also face problems like systems downtime. So, plan in a way and it is the time of technological advancements and by increasing the timing (for IPO), and doing aggressive marketing, our CASA will improve, and once customer open an account in our Bank then definitely they will not go to other Bank?

If you see our whole Bank ’s focus is o f being customer centric that how we can give our customers much more benefits. Now you have the suggestion that instead of 3 o’clock we do it 4 o’clock it is very valuable, and we will see. I want to say one thing in CASA deposit that as you know that 4 years back the Bank faced challenges and at that time our deposits dropped to half. So, it takes a little time on deposits to grow , but in the last 4 years the deposit s have increased by more than two times and if you see in the entire Bank ing Industry CASA ratio is decreasing, but at least we are able to protect our CASA ratio, our CASA ratio has not decreased and it has happened because of the customers support and it is our commitment and assurance to you that for the customers , either in technology or in aggressive marketing , the suggestion which you have given for we will pay close attention to it.

When Bank were facing challenges that time also and already now also there is no disturbance in balance maintained by me in the account and sometimes it does happen that when the system has downtime, we have to fill the physical form (for IPO) and Bank (branch) gets pressure for bidding at the last minute. So, because of that, we face problems. See you all are very aggressive, but tell your team also to be more aggressive?

Sir many customers are my close relative they have around INR 2 crore balance they are trying to shift to another Bank, in that way our CASA will rise aggressively?

Your suggestions are very valuable. So, we will work on that and Rajan ji will talk to you personally on that.

Thank you. The next question is from the line of Mahrukh Adajania from Nuvama. Please go ahead.

Sir, I had a follow up question again on the Personal Loan bit. So, basically we have weeded out all the customers which were probably looki ng a little discomforting and because of closure of lines to them these slippages have occurred or because anyway they were on the lower income side these slippages have occurred as in that were some of these BNPL customers given may not be right given that your ticket size is high or how do we look at the whole piece?

First of all, BNPL came as an experiment, and it failed. So, fortunately we never tested waters into that particular segment. Two is once the customer has come in you have to bear him for 36 months. So, it is not that you can beat him out in between unless you proactively go back and insist that you close the account which generally is not the likely situation. In our internal database proactively when you are looking at acquiring a customer, obviously we have weeded out that set of customers which we potentially were putting up to our teams to acquire. So, from that extent, you're right. Also, from the customers who are coming out from the outside market since we have tightened the criteria, so, these customers will automatically get rejected. So, from that extent for new to the Bank or from existing customers certain segments have been eliminated, but this is nowhere close to the BNPL model. These are the normal Personal Loan customers.

So, going ahead will growth in Personal Loans be slower than earlier only?

I think growth is not that issue because there are lot of customers and Personal Loan is growing at a particular pace, but whenever you will do any kind of policy cuts, temporarily there will be a dip in the business and then you again ramp up because you have a large distribution out which also then alters their way of acquiring and bringing back the customer to various banks.

So, the key reason for the slippage would be what then as in it's just that the income levels did not support or what would it be in general for the 36-month lapse for many this quarter?

I will give you an industry level answer to it a nd obviously these things do reflect in overall across portfolios. One is that c ustomers taking more than one loan after they have taken from you, that tends to be one of the bigger reasons. And secondly it can be around the income levels not going up or the inflation being high, the disposable income coming under stress. So , there could be various ranges and the retail portfolios throw you a lot of opportunities to get insight into the portfolio in various squares which you have to then cut and then kind of look at what is going to be your new acquisition strategy. But having said that even in P ersonal Loans, even if I dissect the quarter between the three months we have seen a very good month, December month where the resolution rates have really gone up to upwards of 87%. So, the resolution rates have become better. So, these customers who were even who have defaulted their resolution rates are getting better.

Thank you. The next question is from the line of an Individual Investor. Please go ahead.

There is too much deviation from the listed security house analysis and why there is too much negative number in retail segment?

Can you repeat your first question deviation in which element you want this to clarify?

Because market has expected too much profit in this quarter , means from the securities house analysis like ICICI Securities has expected the figure around INR 500 crore profit at this quarter, but we have got something INR 281 crore Net Profit and Emkay Capital also analyzed too much profit, but we get less profit than this number and one more thing I wanted to add there is too much speculation is listed around in YouTube. What are you doing in this regard to control this news?

Mrunal ji your voice is not coming clear. We were not able to hear you well. I think the first part of the question which we could gather was around that the market expectation wa s a certain number and we had delivered a certain number below expectations is that a fair question?

Yes.

So, let me respond to that and maybe we can come back to the second question. So, Mrunal ji to be honest we will not be able to comment and let's say on every quarter expectation that markets will have. I think at the start of the year we've been saying that there is a certain path to our profitability to a 1% ROA and which is a journey which requires a lot of execution focus. It was a two-to-three-year journey that we that had highlighted number one. Number two as the kind of period plays out of course there are l ot of external factors that also come in and you would appreciate that over the last one year there has been a s ignificant spike in interest rates , generally in the environment as well , which resulting into NIM compression not only for us but across all the banks. But I think there are certain principles with which we work. There is a certain strategy which is in place, and we are sticking to that strategy a nd just from a profit standpoint because that was a specific question that you had for us it's very important to get the NNPA and Security Receipts also below 1%. So, it's important that we keep improving our PCR for the Bank, w e keep reducing the drag and keep working on expanding the operating profit and that's the work which we keep executing day in day out. We also take by the way through this question of a feedback that maybe the expectation itself in the first place needs to be managed better and that's something we will be happy to communicate more emphatically and effectively on an ongoing basis.

Thank you. We move on to the next question sir which is from the line of Sreenivasan an Individual Investor. Please go ahead.

I have two questions. What is the guidance for this ROA accretive products on the current level of 55% as at the end of FY25 where would we expect it to be and what would be the impact on the bottom line? And sec ond question is like Prashant sir was saying that f rom INR 8,000 Crs odd levels, Security Receipts on the ARC portfolio have come down to INR 6,000 Crs odd, 25% recoveries has happened, but if we see the presentation like the Security Receipts as a percentage of Advances is only 0.8% that comes to roughly INR 1,850 crores. So, what is this difference between INR 1,850 Crs and INR 6,000 crores and INR 4,000 plus crores, c an we assume that like once the provision becomes zero, entirely this INR 4,000 crores would be accretion to the profit, bottom line?

So, basically 0.8% is the net carrying value of SR security receipt after making the provision and once like if N et Carrying Value comes down to zero, then whatever recovery would come would be directly addition to the P&L.

Second question?

On the ROA accretive products again the first point there is we are talking about large scale distributions. Therefore, the path towards migrating towards a higher ROA accretive product is something that we keep calibrating over a period of time, currently which we are running at about 55%. The trajectory would be - continue to improve that. You will continue to see about 5% to 10% improvement in that mix over the next 6 months to 9 months. I think that's really where we will continue to work. Now what does that mean from an RoA perspective. Ultimately, some of these products on the margin I will say again there are two elem ents. One is on the margin and what it does to the book. O n the margin which means to the disbursement mix, these products are already generating an ROA which could be about 60 basis points to 70 basis points higher than what let's say the other products would be, but for those to get expressed on the book could take about anywhere between 2 years to 3 years. So, it is on the margin you might end up making today about 2-3 basis points on the book every quarter, but it will take some amount of time before it starts getting reflected on the book.

Thank you. Ladies and gentlemen, we will take that as the last question for today. I would now hand over the conference to Mr. Prashant Kumar for his closing remarks. Over to you sir.

Again, thank you everyone for joining our earnings call so early in the day. Thank you so much and wish you all the very best.

Thank you very much sir. Ladies and gentlemen this brings the conference call to an end. Thank you, members of the management . On behalf of YES Bank, we thank you for joining us. You may now disconnect your line. Thank you.