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Edited Transcript of BANKINDIA.NSE earnings conference call or presentation 1-Nov-19 10:30am GMT

Q2 2020 Bank of India Ltd Earnings Call

Mumbai Nov 8, 2019 (Thomson StreetEvents) -- Edited Transcript of Bank of India Ltd earnings conference call or presentation Friday, November 1, 2019 at 10:30:00am GMT

TEXT version of Transcript

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Corporate Participants

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* Atanu Kumar Das

Bank of India Limited - Executive Director

* Chaitanya Gayatri Chintapalli

Bank of India Limited - Executive Director

* Kollegal V. Raghavendra

Bank of India Limited - GM & CFO

* Neelam Damodharan

Bank of India Limited - Executive Director

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Conference Call Participants

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* Ankit Choudhary

Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst

* Ashok Kumar Ajmera

Ajcon Global Services Limited - Executive Chairman, CEO & MD

* Jai Mundhra

Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst

* Jayant Kharote

Crédit Suisse AG, Research Division - Research Analyst

* Mahrukh Adajania

IDFC Securities Limited, Research Division - Director

* Shreya Shivani

CLSA Limited, Research Division - Research Analyst

* Sneha Ganatra

Subhkam Ventures - Analyst

* Sushil Choksey;Indus Equity;Analyst

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Presentation

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Operator [1]

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Ladies and gentlemen, good day, and welcome to the Bank of India earnings conference call. This is to inform you that the Q2 financial results and a detailed PowerPoint presentation has been uploaded to the web portals of BSE, NSE and Bank of India, and I'm sure you must have gone through the presentation. (Operator Instructions) Please note that this conference is being recorded.

Let me introduce the management of Bank of India available for the conference call today. We have Shri N. Damodharan, Executive Director; Shri A.K. Das, Executive Director; Shri C.G. Chaitanya, Executive Director; Shri K.V. Raghavendra, General Manager and CFO, accompanied by other general managers.

I would now like to hand the conference over to Shri N. Damodharan, Executive Director. Thank you, and over to you, sir.

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Neelam Damodharan, Bank of India Limited - Executive Director [2]

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Thank you, and good evening to one and all. I'll be very brief in my introductory remarks. We are pleased to share with you, as you all have gone through the presentation already. On the profitability front, the bank has done consistently well for the past 3 quarters. It has been making operating profit as well as net profit year-on-year as well as quarter-over-quarter. The fee income, the operating profit, the NIM, net profit, all have been good. The interest margin has improved. And there have been no one-offs this time like IT refund, interest or anything. Then in the credit growth, in the retail segment, particularly home loan, we have done well.

And in regard to the other corporate segment, what we have done is, we have done a little bit of a rejig in the segment, which is reflected in the interest earning. You might have observed that already. CASA, we have improved to 42.5%. The slippage containment has been consistently good, and it has been reduced, and it will be further going down in the coming quarters. The GNPA has improved. The PCR is again maintained at a stable level of 77.11%. The rating profile has improved with an improvement in the A-rated portfolio. As I said, slippage control has been good.

In the recovery front, we have not been to the expected level to our own satisfaction, but it was actually a story in pipeline because some of the NCLT cases, which are in a very advanced stage of resolution, where the decisions have come, but due to certain legal processes it has been delayed. And again, in power sector, Samadhan. Under Samadhan, another 4 accounts are already in various stages of approval with different banks. Once these 2 things happen, in Q3, these -- the results will mature and improve the recovery, which is a spillover effect of Q2 actually.

In addition to that, in Q3 and Q4, we have -- last time also, we have discussed about the OTS schemes that we have, nondiscretionary and nondiscriminatory. The spadework has been done already in those cases, eligible accounts. And the results will show in the coming quarter. The international book also have shown consolidation, and improvement in NIM is seen both in domestic as well as in international books. The credit cost has improved -- the cost-income ratio has improved year-on-year basis. And this slippage percentage has been contained below 2%, which was much, much higher earlier.

The loan quality has also improved. You can see from the small ticket advances only or most of the cases slipping only, and that is also limited, contained a lot. We are able to improve on the credit quality. We have -- for improving the credit quality, we have introduced various systems and monitoring procedures. As we have told last time, the SAM vertical has been introduced and it has stabilized in our bank well.

The risk management segment vertical has been strengthened. Fraud risk management has been -- technology-based fraud risk management is getting introduced, which will be on flow from December onwards. For credit monitoring also, technology-based package we are introducing. It is in well-advanced stage. And for the retail and SME, MSME and agriculture, the processing centers have been strengthened. As I said, the international book consolidation and growth is visible this quarter.

With this brief introduction, I think we can have interaction. And during the course of interaction, all of us will be sharing more information as you desire.

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Questions and Answers

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Operator [1]

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(Operator Instructions) The first question is from the line of Ashok Ajmera from Ajcon Global.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [2]

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Happy New Year to you all. Happy Diwali and Happy New Year. Sir, of course, it is accepted that the profitability has been maintained and the performance is reasonably good. But the main concerns remains the same and some of them which were in the last quarter, we were hoping for some better figures have not resulted into that. Now if you look at -- suddenly, SMA 1 and 2, these 218 accounts, it has gone to INR 16,309 crores as against INR 6,800 crores, 187 accounts in June and 262 account, INR 5,675 crores in September '18. So what is the reason for such sudden increase in this SMA 2 -- 1 and 2? And are they, it means, on the watch list? And what is the outcome you expect out of it?

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Neelam Damodharan, Bank of India Limited - Executive Director [3]

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Yes. Can I take the question?

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [4]

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Yes, I mean I have a couple of other observations also. So we can go one by one.

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Neelam Damodharan, Bank of India Limited - Executive Director [5]

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Okay. See, in SMA 1 and 2, this figure looks little high, but actually, it is not. Actual -- the real stress is in, say, for about INR 6,000 crores. Because in this INR 16,000 crores, one account certainly is -- cause for concern is that one HFC account around INR 4,000 crores. Other than that, there are -- there is one restructured account, which is a public sector undertaking and government-guaranteed account amounting to around INR 4,000 crores, which is not -- which is -- which -- there is some delayed payment, but never it slip, never it will be a cause for concern. And it also is going to be settled in due course of time.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [6]

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Government-guaranteed account?

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Neelam Damodharan, Bank of India Limited - Executive Director [7]

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Government-guaranteed account, yes. It is in the aviation sector.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [8]

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Okay. Air India.

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Neelam Damodharan, Bank of India Limited - Executive Director [9]

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Okay. That is not -- that is around INR 4,000 crores. That is not a concern. And another INR 3,000 crores, 2 accounts. Actually, these are also government-guaranteed accounts. But due to some technical reason, this time, they have come in the SMA 1 and 2 list. Actually, this will not come in future -- in December and March, it will not be appearing because for certain technical reason, they have come. Otherwise, they are not under stress.

So if we take away that government-guaranteed account, these 3 accounts, which amount to nearly INR 7,000, crores, one account is that INR 4,000 crores in HFC, which is a cause for concern. These INR 7,000 crores of government-guaranteed accounts are not cause for concern. So the amount, though, it appears INR 16,000 crores, it is not that much big. Actual stress, you can consider it will be around INR 6,000 crores.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [10]

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Okay. So Air India, I mean, what is the ultimate outcome? I mean are we taking the income in our profit and loss account whatever is the rate of interest which we are generating on it? And how much duration or time you expect or you got message from the government or Air India management that when this account can finally be resolved?

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Unidentified Company Representative, [11]

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If you look at the Air India, you will find the exposure has started coming down also. Because of the 3 tranches of the bonds they have raised, they started repaying also. So we expect that the repayment will start coming. And then it will be put in proper shape.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [12]

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It was INR 3,614 crores last time, and this time, you said about INR 4,000 crore. So where it has gone down?

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Neelam Damodharan, Bank of India Limited - Executive Director [13]

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No, I told it is less than INR 4,000 crores. It is not INR 4,000 crores.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [14]

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Yes. Yes. All right. Now coming back to those accounts, which we discussed during the last quarter and some of the ADAG account, Essel Group, Indiabulls Housing, what is the status on those 4, 5 accounts, which we were very hopeful of getting resolution or getting some good money out of it, what is the status of those accounts, sir?

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Neelam Damodharan, Bank of India Limited - Executive Director [15]

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See, in Essel Group, we have a small portfolio for less than INR 400 crores.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [16]

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INR 383 crores.

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Neelam Damodharan, Bank of India Limited - Executive Director [17]

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INR 386 crores. So it is the -- 2 of the accounts are in SMA 2. Only 1 account is under resolution. It is under resolution process. So in ADAG, we have around INR 2,000 crores. There, 1 major account, we have already 90% provision. And these are all under various process of NCLT or CIRP. It is already recovering or resolution process is going on. And we have to wait for that.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [18]

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And what about Indiabulls Housing?

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Neelam Damodharan, Bank of India Limited - Executive Director [19]

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Indiabulls Housing is standard...

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Unidentified Company Representative, [20]

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Indiabulls Housing, what's the stress in that?

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [21]

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Yes. Is there any stress on that, the INR 3,500 crores?

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Unidentified Company Representative, [22]

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No, I don't find it.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [23]

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Okay. So according to you, that's absolute nonstressed standard account? Isn't it?

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Unidentified Company Representative, [24]

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Yes.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [25]

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Now sir, towards this -- again, coming back on this recovery, recovery is competitively very, very low. I mean forgetting about the NCLT, some resolution got delayed. Even in the other normal accounts, which are pursued on day-to-day basis, I mean, there also if you look at it, this amount of recovery is comparatively very small. So is that -- I mean, what kind of messages are we getting? I mean the economy is absolutely down, whether the people are not having money to pay or they don't want to repay? Or what is your feedback on that, sir?

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Neelam Damodharan, Bank of India Limited - Executive Director [26]

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No, see, as you know, and you understand very well, you yourself said that recovery process, it takes its own time. But as you said, we were expecting recovery through NCLT process itself in the Q2 in 7 accounts. It was amounting to around INR 1,900 crores, INR 2,000 crores.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [27]

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Total target was INR 2,400 crores.

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Neelam Damodharan, Bank of India Limited - Executive Director [28]

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INR 2,400 crores. That is getting a little bit delayed, maybe in the Q3 and Q4. Because out of that 1 account, you know very well, it is in the Supreme Court and in the final stages. And there, 100% outstanding we are expecting. In the remaining 6 cases also, it is in very advanced stage of resolution process, like Ruchi Soya and all. We will be getting the recovery in Q3 or Q4 in this. In addition to that, in 4 accounts, we have under the Samadhan process. In Q3, we are expecting the power projects. In these 4 cases, we are expecting around INR 1,200 crores in Q3 itself. And under the RBI Circular 76 also, we are expecting in the Q4 substantial amount to be resolved.

In addition to that, see, we last time discussed -- the bank has introduced in the end of Q1, the OTS schemes for the fully provided accounts where all other avenues of recovery have been already explored and have gone through, exhausted. So in this, a large number of accounts are involved. There, all the borrowers have been contacted. Offer levels have been given. Discussions are happening. And this will fructify and will give the anticipated results in the current quarter and in Q4. Because the time is given, in many cases, for payment up to March 2020. So installment just keeps coming and further negotiations and the sanctions will happen.

In this also, we are expecting substantial improvement in recovery because in Q2, the process was initiated, contacts have been established, discussions have started happening. So these results will be visible in Q3 and certainly in Q4. In addition to that, a few of the cases, which were sold to the ARCs earlier years, 2015 and all, around INR 500 crores we are expecting payment in Q3 itself...

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [29]

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Okay. INR 500 crores.

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Neelam Damodharan, Bank of India Limited - Executive Director [30]

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In INR 500 crores. That is old cases. There also we are getting recovery. I'm very hopeful because we are sure in this month of November itself, we'll be hitting that INR 500 crores. In addition to that, last quarter, that is Q2, we could not go for ARC sale. Obvious reasons you know very well, the market condition. But this quarter and in Q4, we will be aggressively trying for that avenue also. There we have more than INR 20,000 crores accounts identified. And we will be exploring that option. Though Q2, the recovery has been a little subdued, in Q3 and Q4, we are sure of compensating whatever the gap that has come in Q2. In addition to that, slippages, we have contained in a better way because last time we have talked about slippage of around INR 3,400 crores. Against that, the slippage was only INR 3,100 crores. And it will be further improving in Q3, with the exception of one HFC account. Otherwise...

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [31]

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You maintain the target of INR 12,000 crore of total...

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Neelam Damodharan, Bank of India Limited - Executive Director [32]

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Maybe a little...

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [33]

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Or little lesser than that actually.

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Neelam Damodharan, Bank of India Limited - Executive Director [34]

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Maybe around that. But we will be trying to -- even if it is a little more, we will be trying to improve on the recovery front, and we will be covering it up so.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [35]

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Sir, on the SME, MSME loan on the special dispensation that you have made the account standard, INR 1,518 crore. So what you -- I mean, outlook on these accounts just because of the leeway available, it's been continued to be standard account, but otherwise, as per your own bank's analysis, what could be the pain in this account so that we -- some idea on how much hit we are going to take in the fourth quarter, third quarter on this some of these MSME accounts with INR 1,518 crore, 53,000 accounts, which have been restructured?

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Unidentified Company Representative, [36]

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Yes. One good positive feature out of this 2.15 lakh accounts, which we identified as of January 1, standard but stressed. The trend has been pretty consistent. Out of the accounts concluded, almost 70% are ending up with recovery and 30% are going for restructuring. And because in many cases, we are finding the urge to go for restructuring on the part of MSME clients is a little less. They are not forthcoming wholeheartedly for restructuring because they are in a good position to make their payment obligations. And I think there is no cause for concern there. We got time up to March 2020. I think most of the cases, we can conclusively finish -- complete there.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [37]

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So there won't be any -- nothing alarming in those accounts? And sir, very high write-off this quarter, INR 2,498 crore versus INR 689 crore in the last quarter. Which are the main -- are there some bigger accounts in this write-off of INR 2,498 crore? Or they are the more number of accounts, which is...

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Neelam Damodharan, Bank of India Limited - Executive Director [38]

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It is -- actually, these are all 100% provided accounts. There has been -- after exhausting all the legal avenues and all, we have made 100% provision in these accounts, which have been written off now. The recovery prospects in these accounts have been already tested and exhausted. And it is not alarming situation or anything. It is -- after exhausting all avenues, we have taken this because it was already carrying 100% provision.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [39]

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Yes. Yes. But then in 1 quarter taking such a big...

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Operator [40]

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I'm sorry to interrupt you, Mr. Ajmera. But may we request you to join the queue for follow-up questions? (Operator Instructions) We take the next question from the line of Sneha Ganatra from Subhkam Ventures.

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Sneha Ganatra, Subhkam Ventures - Analyst [41]

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I just wanted to understand, despite of the repo rate cut and MCLR cut, still our yield on advances has improved quarter-on-quarter basis significantly. Any reason to look into that?

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Unidentified Company Representative, [42]

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The repo rate cut, especially on the advances front, whenever we are devising interest rate linked to repo and all, this will be mostly prospective and with a time lag. And these are applicable to only fresh customers. So the real impact can be seen maybe only after a lag of 1 or 2 quarters. So that's the reason that yield has continued to improve in spite of effectively reducing the rate of interest on fresh advances.

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Neelam Damodharan, Bank of India Limited - Executive Director [43]

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But whatever the MCLR -- even before repo linked introduction, whatever the MCLR, this RBI rate cut, we have passed it on IN MCLR [regimen] also. What we have done is, in this case, the growth had been in retail and other segments where the yield was a little better. And even in the corporate segment, there has been a rejig. Thereby, we have replaced certain low-yielding advances with better-yielding advances. All these things have contributed towards improving the interest earning. And this sort of exercise, we'll continue doing. And we have also rationalized the interest rate, extended to the corporates and because of which also there has been some improvement.

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Sneha Ganatra, Subhkam Ventures - Analyst [44]

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Okay. So what is the outlook on the margins considering this REPO rate would be working out?

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Unidentified Company Representative, [45]

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The margins, we expect the margins to stay around 3% or little above that because one of the ways to have a holistic approach and word of margin pressure is also to have a look at the liability portfolios. And we are doing that for the assets. We are also, if not to the same extent, but in a gradual manner, we are also having realigning our liability portfolio.

And second is volume expansion. We know our growth has been muted in the first half. But a lot of sanctions have been made. And second half, we expect the offtake to be much higher. So obviously, the volume will help us, and we will be able to retain the margin at least around 3% or little above that.

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Sneha Ganatra, Subhkam Ventures - Analyst [46]

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Okay. And how do you see the overall book, loan book growth because first half is remaining muted?

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Unidentified Company Representative, [47]

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See, if you were looking at loan book growth, during the current half year, we have sanctions of around INR 26,000 crores, what we have sanctioned it. And in the last quarter also, we have sanctioned to the tune of around INR 18,000 crores. We have seen the -- offtake is a little moderate offtake that happened. And the more offtake happen, the disbursements is going to happen. That's how the growth will be.

If you're looking at the growth part of it, as you have seen that on the year-on-year, the retail has grown at 13% and the housing loans have grown at 15%. And the corporates, what I have discussed is what the sanctions are there and the disbursements are yet to happen. In addition to that, our focus remains at around corporate lending of INR 5 crores and above up to INR 25 crores spread across 300 focused branches, where we wanted to have a more distributed credit to happen and that's where the margins also increases where the price pressure will not be there. So we look at a guidance of around 10% growth, what we are looking at presently.

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Sneha Ganatra, Subhkam Ventures - Analyst [48]

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Okay. And on the slippages front, you are expecting the run rate would be similar to that INR 3,000 crores level, except HFC account?

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Neelam Damodharan, Bank of India Limited - Executive Director [49]

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Yes, it will be -- we are trying to contain it below INR 3,000 crores. And we are hopeful because whatever the bigger accounts in SMAs, above INR 5 crores also in SMA 1 and 2, they are not cause for alarm for us except 1 or 2 accounts as you said. In other accounts, we are confident that they will not slip, big ticket accounts, except 1 or 2, including a probability of that HFC account. Other than that, we are not expecting much. Even in agriculture and RAM advances, that is retail, agriculture and MSME, we are able to contain. Even in the Q2 compared to the Q1 also, the containment has been substantially improved. So we expect and we expect the slippages in the Q3 and Q4 to be below INR 3,000 crores with the exception of those 2 accounts.

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Sneha Ganatra, Subhkam Ventures - Analyst [50]

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2 accounts, 1 is HFC and the other is?

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Neelam Damodharan, Bank of India Limited - Executive Director [51]

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One more account is there, Reliance Commercial, but maybe a little.

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Sneha Ganatra, Subhkam Ventures - Analyst [52]

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And what is that exposure amount is?

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Neelam Damodharan, Bank of India Limited - Executive Director [53]

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Exposure is around INR 400 crores, no?

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Unidentified Company Representative, [54]

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INR 400 crores.

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Neelam Damodharan, Bank of India Limited - Executive Director [55]

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INR 400 crores.

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Sneha Ganatra, Subhkam Ventures - Analyst [56]

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And how do you see the overall credit cost for the second half?

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Neelam Damodharan, Bank of India Limited - Executive Director [57]

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Credit cost, as you have seen, it has substantially improved to 1.74. See, what we are looking at is bringing down the GNPA level from the INR 61,000 crores level to less than INR 58,000 crores. And with the credit growth, again, this -- both these factors will have an impact on different ratios. And we expect this to substantially go down to below 1.5 by Q4.

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Operator [58]

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(Operator Instructions) The next question is from the line of Ankit Choudhary from B&K Securities.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [59]

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Sir, my first question is related to the slippages. So if you can just provide us what were the slippages, segment-wise slippages during the quarter like the corporate, retail.

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Neelam Damodharan, Bank of India Limited - Executive Director [60]

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Okay.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [61]

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And also, if you can provide, what was the lumpy slippages in the corporate segment?

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Neelam Damodharan, Bank of India Limited - Executive Director [62]

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Yes. See, in the Q1 and Q2 put together, see, around INR 2,000 crores has been in the agriculture, around INR 1,000 crores in MSME, around INR 550 crores in retail, around INR 2,000 crores in corporate segment. Only 2, 3 accounts are there in the corporate segment were big, one is Sintex, then Reliance Home, and then one Technofab, then -- this quarter, these are all in Q2. In Q1, we had McNally balance.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [63]

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Yes. Okay. Sir, second question was in continuation to the prior question one participant had asked regarding the SMA 2 increase. So if we see the SMA 2 has almost doubled, so is it inclusive of Dewan over here?

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Neelam Damodharan, Bank of India Limited - Executive Director [64]

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Yes, yes. I have mentioned about that. See, that around INR 4,000 crores was in this one particular housing finance company that has come in SMA category.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [65]

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SMA 2, right?

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Neelam Damodharan, Bank of India Limited - Executive Director [66]

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Yes, SMA 2, and the remaining, I talked about one government-guaranteed account, public sector undertaking, which will never slip because it is government-guaranteed. The rate is around INR 3,600-and-odd crores. And the rest 2 public sector, government accounts, have come in the SMA for technical reasons because of our bank-related internal reasons and it was not because of their repayment stress or anything. That will -- those 2 accounts will not appear in Q3 and Q4.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [67]

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So sir just 2 accounts of INR 3,000 crores. They were part of SMA 1, right, both the accounts?

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Neelam Damodharan, Bank of India Limited - Executive Director [68]

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Yes. Yes.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [69]

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Okay. Understood. And sir, so if you can just mention that what are the ICAs that we have signed recently, if you can just quantify the amount and the companies or the sectors or number of accounts?

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Unidentified Company Representative, [70]

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21 accounts, INR 15,000 crores.

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Neelam Damodharan, Bank of India Limited - Executive Director [71]

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21 accounts, INR 15,000 crores ICAs have been signed.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [72]

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Okay. And sir, on this -- in one of your comments, you have mentioned that in the OTS scheme so you are expecting substantial recovery, right, in third quarter itself. So how much is the amount, which is under the OTS scheme that we're expecting the recovery in December and March quarter?

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Neelam Damodharan, Bank of India Limited - Executive Director [73]

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See, we expect around -- under this structured OTS scheme, we will be reducing the NPA by around INR 1,500 crores.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [74]

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So that is a recovery you're expecting over here?

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Neelam Damodharan, Bank of India Limited - Executive Director [75]

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Yes, but the recovery, usually it depends upon -- usually, we give 3 months to 6 months' time for payment and installments. We have exactly not able to quantify quarter-wise, but before March, we will be able to recover this much.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [76]

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Okay. And sir, final thing on this. So we had mentioned that we have 7 NCLT accounts of INR 2,400 crores that we're expecting the recovery, right? So 1 account is under the court case. So are these 4 accounts of Samadhan part of that, 7 NCLT cases? Or is it separate accounts altogether?

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Neelam Damodharan, Bank of India Limited - Executive Director [77]

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Which 4 cases you're talking?

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [78]

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So you mentioned there 4 accounts, which are under Samadhan process, INR 1,200 crore. So is this part of that 7 NCLT cases that we're expecting the recovery from? Is that -- or is that these are separate accounts altogether?

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Neelam Damodharan, Bank of India Limited - Executive Director [79]

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They're different.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [80]

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So we have altogether like -- put together, 11 accounts, which are like in the hind side of recovery next quarter.

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Neelam Damodharan, Bank of India Limited - Executive Director [81]

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Yes.

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Operator [82]

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Next we have a follow-up question from the line of Ashok Ajmera from Ajcon Global.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [83]

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Sir, can you throw some light on the AUCA account, I mean, advance under collection account?

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Unidentified Company Representative, [84]

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Written-off, our written-off accounts...

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Neelam Damodharan, Bank of India Limited - Executive Director [85]

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Advance under collection -- what is AUCA?

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Unidentified Company Representative, [86]

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Cumulative written-off account. Cumulative written-off account of the balance sheet, prudentially written-off accounts. And what is the expected recovery.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [87]

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And the recovery, expected recovery from that?

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Neelam Damodharan, Bank of India Limited - Executive Director [88]

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See, under the prudentially written-off, see, one is we have SR itself in that category.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [89]

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SR is in that category.

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Neelam Damodharan, Bank of India Limited - Executive Director [90]

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We are having a claim of around INR 1,800 crores in that.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [91]

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Okay.

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Neelam Damodharan, Bank of India Limited - Executive Director [92]

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In small accounts -- small ticket accounts, we are expecting around -- in these 2 quarters put together around INR 1,000 crores recovery to come from BW accounts.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [93]

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Okay. That is a good amount. And...

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Neelam Damodharan, Bank of India Limited - Executive Director [94]

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2 quarters put together, I'll not be able to detail quarter-wise. But what we aim at is for INR 1,000 crore recovery.

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Unidentified Company Representative, [95]

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INR 1,000 crore of recovery on this AUCA.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [96]

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Good sir. Now sir, coming back on the business front, like you yourself said in the opening remarks that the growth in the business is basically from the home loans where there is a good growth. But ultimately, sir, now after all this cleaning up and everything and now with the economy, if it has to perform, it is only going to be through the expansion of the credit, new businesses, greenfield projects, but it seems that the bank's attitude still is very, very conservative on the project finance and other thing where even in case of the greenfield, also the huge collaterals are asked for, which are not available to an entrepreneur for putting up a project or going for a major expansion. So what are your views on the credit front and the credit policy per se? I mean is there any opening up of the credit going again, like coming down from those stricter norms once again? Or where do you see the credit coming from -- apart from the home loans or retail or other thing where everybody is chasing that the growth is going to come from in the business, 10% target of yours?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [97]

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Can I reply?

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [98]

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Yes, sir.

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [99]

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What we find is not much of the greenfield projects are coming. It's not that we are not looking into that. But presently, not much of the greenfield projects are coming and it will take some more time also because every existing industry is trying to reach the total capacity utilizations into that levels, then only they will be coming for the next greenfield project to get into that. So it will take a little time for that. But before if you look at that, our strategy towards the corporate advances, still the retail businesses continue. Still the service sector, everything is being continued. So our priority area, what we looked at, the credit up to INR 25 crores, that's what we call it as a prime credit, focused branches of 300 branches, wherein we wanted to push the credit and very distributed geographically also. This is where our focus lies.

In addition to what we have done during the last 2 quarters also, there is some growth in the infra coming to the HAM projects, some HAM projects are there, some express ways are there, and NBFCs that were with due care in the due diligence what we looked at, some funding to the NBFCs has gone. So the corporate, when we are looking at, it is growing all through with -- not big corporates we are talking about, we are talking about a corporate up to INR 25 crores and we are talking about the infra that it is coming and then the NBFC what is existing. This is in addition to what we are looking at the growth in the retail, what we have done and the agriculture and SME where we are very strong with the processing centers, what we have it.

So we look forward to more -- and more growth will come and more disbursements is going to take place because with the sanctions, what we have done, the much of the disbursements are yet to take place to find the growth for the quarters, what it is bygone. So that's the reason we are looking at the guidance of around 10% growth with all these factors constrained.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [100]

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But sir, with even government now thinking to change the definition of MSME to be more of a turnover based rather than only the machinery investment or capital investment, this limit of INR 25 crores for a greenfield is good enough for even a small industry nowadays, somebody push it in like INR 50 crore, INR 100 crore, INR 75 crore or INR 150 crore. I mean that -- this INR 25 crore may be okay for increasing your working capital facilities or some minor expansion and other things, it's just a suggestion, just a part to look at -- to relook the whole credit policy as such because all said and done, the country has to grow. I mean the industrialization has to be again come up and the credit has to be disbursed to reach the target of $5 trillion economy by 2024 or '25.

So after having burned even the fingers also, once again, one has to relook at the whole this thing because we -- generally, when we go out and find, it has become very, very difficult for the people to put even a small greenfield of INR 100 crore, INR 200 crore also because huge collaterals are demanded, which no entrepreneur can have or matching collateral or 50% collateral for even a normal project. So I think -- and that will also help in achieving that growth target also.

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Neelam Damodharan, Bank of India Limited - Executive Director [101]

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Mr. Ajmera, a well-taken point. Only thing is, I want to clarify is we don't have a policy stipulating collateral of this nature. It is actually -- it is not policy stipulated or driven, but it is on a case-to-case basis, but certainly not to the extent what you have mentioned about. And we are, as Mr. Chaitanya has said, we are for project finance and we are looking for it. He talked about HAM projects and road projects, which are only visible. Other than that, there is no visibility of bigger projects coming up also. So the -- what Mr. Chaitanya talked about, INR 25 crore is not because of risk aversion, but because that is an avenue available for us to look for a growth because NBFC is vacating the space. Yes. So we are looking at growth avenue there. And that is why we have treated -- classified that as a prime target for us, whereas our lookout for project funding on viable projects, certainly, without any, what you call, a policy-driven collateral without -- policy-driven collateral demand.

We will be looking at it with a positive approach. So our -- for example, we have a sanction of more than INR 25,000 crores. But disbursement will be happening in a piecemeal basis. And these sanctions have happened, say, in August, September and October. They are all in the process of getting disbursed. Similarly in the MSME, if you look at -- in our own portfolio, the working capital limits are utilized only to the extent of 70%, 75%. Because even the borrowers are little averse to avail unless they have -- they look at -- have a business opportunity. So we are working in -- the banking credit lending is in an environment where demand is also not much and avenues are limited. But within this environment, we are trying to find out space, particularly what the INR 25 crores was talked about is not to limit our exposure to INR 25 crores loan book -- loan ticket, but that there we are finding a space where the NBFCs are vacating. That's why that was told.

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Operator [102]

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The next question is from the line of Shreya Shivani from CLSA.

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Shreya Shivani, CLSA Limited, Research Division - Research Analyst [103]

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So I wanted to ask what is the loan outstanding to S R Steel on Bank of India book. And this is -- can you give me the number which excludes any ARC receipt? Also wanted to get your view on the resolution process and -- sorry, resolution status of the same?

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Neelam Damodharan, Bank of India Limited - Executive Director [104]

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Yes. See our book outstanding is INR 1,985 crores. Yes, our claim all admitted is INR 1,985 crores with NCLT. And the present status is, we all know, it is in the court and we are awaiting -- eagerly awaiting for a positive decision.

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Shreya Shivani, CLSA Limited, Research Division - Research Analyst [105]

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Okay, sure sir. And this INR 1,985 crore is excluding any ARC receipt, right?

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Neelam Damodharan, Bank of India Limited - Executive Director [106]

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Yes.

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Operator [107]

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The next question is from the line of Ankit Choudhary from B&K Securities.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [108]

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Sir, on the NCLT 1 and 2 cases, what is the PCR outstanding right now?

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Neelam Damodharan, Bank of India Limited - Executive Director [109]

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PC?

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [110]

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PCR, provision coverage, what was it around?

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Neelam Damodharan, Bank of India Limited - Executive Director [111]

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100% is out -- this provision held in this case is 1 and 2. Amount is in this list 1, it is INR 3,700 crores and in list 2, it is INR 2,781 crores.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [112]

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Sir, some data getting questions. So basically, on the SL Group, so you mentioned that there's a small portfolio of INR 386 crores. So is it the total exposure we have including the NPAs?

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Neelam Damodharan, Bank of India Limited - Executive Director [113]

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Yes, yes, yes.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [114]

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So 2 are under SME 2, right? What is the quantum over there?

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Neelam Damodharan, Bank of India Limited - Executive Director [115]

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It is around INR 170 crores.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [116]

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And that one account is under resolution, which is NPA, right?

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Neelam Damodharan, Bank of India Limited - Executive Director [117]

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Yes, INR 240 crores.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [118]

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Yes. And on this ADAG, sir, INR 2,000 crore, which is exposure, how much -- is there any standard right now in RDG Group or all is NPA or under SME?

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Neelam Damodharan, Bank of India Limited - Executive Director [119]

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Which one? Can you repeat, please?

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [120]

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ADAG group.

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Neelam Damodharan, Bank of India Limited - Executive Director [121]

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Yes.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [122]

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So INR 2,000 crores. So what is the standard over there? And what is the NPA?

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Neelam Damodharan, Bank of India Limited - Executive Director [123]

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See, INR 437 crores is standard as of now, rest is NPA.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [124]

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And this INR 437 crores, is it this commercial?

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Neelam Damodharan, Bank of India Limited - Executive Director [125]

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Yes.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [126]

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It has commercial line, which is under SME.

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Neelam Damodharan, Bank of India Limited - Executive Director [127]

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Yes.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [128]

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Okay. And do you have any exposure to Srei Group, sir?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [129]

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What sir?

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [130]

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Srei Group.

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [131]

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Yes, we have an exposure, yes.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [132]

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Is it under SME standard? And what is the exposure, sir?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [133]

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It is on standard. It's not under SME.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [134]

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Okay. And if you can quantify the same, sir?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [135]

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How much it's around? 1,000? Around 1,300.

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Ankit Choudhary, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [136]

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And finally, one clarification. You have mentioned that there sanctions of INR 26,000 crores. Is it the corporate segment sanctions?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [137]

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It is. Yes. Corporate means it's INR 5 crores and above.

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Operator [138]

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The next question is from the line of Jai Mundhra from B&K Securities.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [139]

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So first is on Dewan exposure. So the pool buyout that we have around INR 1,000 crores, INR 1,200 crores. Now what happens to that sir? Now -- I mean how confident are you on that exposure?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [140]

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See the pool buyout exposure, we are presently receiving the credits. And then the lenders also kept a cash flow capturing mechanism also for INR 1.3 crores. And recently, we don't find much of the delinquency in that, except INR 1.3 crores of NPA like.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [141]

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But sir, who is the -- I mean the collection process is still being managed by Dewan as of now, right? Or you have taken over the collection process?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [142]

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Lenders have taken over that.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [143]

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Okay. And the money comes to your account? Or is there some pooled account?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [144]

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Lenders are monitoring those accounts.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [145]

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Okay. Sure. And sir, this ICA list that we have signed of around INR 15,000 crores, is this all standard account? Or this includes everything?

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Neelam Damodharan, Bank of India Limited - Executive Director [146]

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Everything. It includes both standard and NPA.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [147]

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Okay. Sir, can I know the quantum of accounts, which are standard and wherein you have signed the ICA because some of the banks are now disclosing what is ICA standard and what is the NPA thing? Just to understand what is the near-term stress.

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Neelam Damodharan, Bank of India Limited - Executive Director [148]

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Yes. We can tell that. Just give me a few minutes. Any other questions in the parallel?

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [149]

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Yes. And sir, the third question I had was the Mudra amount. If you have given the Mudra loan outstanding? And what is the NPA there?

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Neelam Damodharan, Bank of India Limited - Executive Director [150]

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Yes. One minute. Mudra is around -- just a moment, I'll tell you.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [151]

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ICA sir, you can name the -- I mean you can tell me the account-wise as well as if that is possible.

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Neelam Damodharan, Bank of India Limited - Executive Director [152]

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Which one?

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [153]

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This ICA list. I mean 7,8, account, whatever the account that you have, you can just name them and I'll just add to quantum.

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Unidentified Company Representative, [154]

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Yes. Around INR 12,000 crores.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [155]

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INR 12,000 crores is the standard cases.

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Unidentified Company Representative, [156]

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In Mudra, all 3 key cases put together, Shishu, Kishor and Tarun, it's about INR 12,000 crores. And Shishu has got about INR 800 crores, where the -- and it has all small to get up to INR 50,000. There, the NPA, the delinquency is about 14% to 15% margin. And in the other 2 segments, it is around 10% to 12%.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [157]

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Okay. So rest is -- I mean Shishu is only INR 800 crores. INR 800 crores is the NPA amount, right?

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Unidentified Company Representative, [158]

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No, no, no. It is a total book balance, book outstanding.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [159]

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Okay. Total book is only INR 800 crores, of which, 14%, 15% is NPA. And in the rest, Tarun and other category, INR 11,200 crores is outstanding and around 10% is the NPA. Right sir?

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Neelam Damodharan, Bank of India Limited - Executive Director [160]

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Yes.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [161]

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Okay, sure. And just on this ICA, sir, if you can help me the name of the account, which we have signed ICA in the quantum?

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Neelam Damodharan, Bank of India Limited - Executive Director [162]

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Yes. ICAs, as said, I mean, 20 accounts and INR 15,000 crores. And in that, 5 accounts are standard SME and INR 5,000 crores.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [163]

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Okay. So one of them would be this Reliance, which is there, right, reliance Commercial?

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Neelam Damodharan, Bank of India Limited - Executive Director [164]

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Yes, yes.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [165]

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And sir, if you can help me the rest 4?

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Neelam Damodharan, Bank of India Limited - Executive Director [166]

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Rest 4 is, one is Religare and then DHFL is one. Yes. DHFL -- actually it is only 3 accounts because DHFL 2, we have competitors 2. And one more account is McNally.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [167]

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Okay. But that is already NPA, right?

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Neelam Damodharan, Bank of India Limited - Executive Director [168]

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Yes, yes, I'm sorry. Yes, NPA already, yes.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [169]

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And DHFL, why -- which is the second entity, sir? I mean only 1 entity was sold off to Blackstone and that was out of DHFL Group.

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Unidentified Company Representative, [170]

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(inaudible)

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Neelam Damodharan, Bank of India Limited - Executive Director [171]

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That is the other. That we have not included.

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Unidentified Company Representative, [172]

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Talking the DHFL 2 means that one is...

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Neelam Damodharan, Bank of India Limited - Executive Director [173]

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One is investment bank, yes.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [174]

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Okay, okay. So you are taking loan account separate and investment as separate.

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Neelam Damodharan, Bank of India Limited - Executive Director [175]

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Yes.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [176]

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The entity is only DHFL, right?

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Neelam Damodharan, Bank of India Limited - Executive Director [177]

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Yes, yes, yes.

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Jai Mundhra, Batlivala & Karani Securities India Pvt. Ltd., Research Division - Research Analyst [178]

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Sure, sir. So you have 3, Religare, DHFL and Reliance Commercial as standard category.

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Neelam Damodharan, Bank of India Limited - Executive Director [179]

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Yes.

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Operator [180]

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The next question is from the line of Kushal Shah from Crédit Suisse.

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Jayant Kharote, Crédit Suisse AG, Research Division - Research Analyst [181]

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Sir, this is Jayant. I just wanted to know our NBFC exposure and how was it moved?

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Unidentified Company Representative, [182]

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NBFC exposure, we have around INR 43,000 crores of exposure, what we have, both putting together NBFCs and the NBFC-HFCs together. These are the NBFCs where we have included, the PSUs are also there. And we have the major private sector, people are also there like Tatas, Bajaj and Aditya Birla Group. These people are also there. And in addition, we have the other private sector players.

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Operator [183]

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The next question is from the line of Mahrukh Adajania from IDFC Securities.

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Mahrukh Adajania, IDFC Securities Limited, Research Division - Director [184]

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I just wanted to check on DHFL. So given the KPMG audit report, is RBI likely to ask banks to classify it as fraud?

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Neelam Damodharan, Bank of India Limited - Executive Director [185]

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We have not heard anything as of now.

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Mahrukh Adajania, IDFC Securities Limited, Research Division - Director [186]

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Okay. So as of now, the resolution is on. What is the status of the resolution because the bondholders have also dragged it to court? So...

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Neelam Damodharan, Bank of India Limited - Executive Director [187]

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Yes, it is still under discussion only. Nothing concrete has emerged as of now.

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Mahrukh Adajania, IDFC Securities Limited, Research Division - Director [188]

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Okay. And after what date does it slip to NPL category? Means what is the deadline?

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Unidentified Company Representative, [189]

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It's in the current month around November some time frame.

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Neelam Damodharan, Bank of India Limited - Executive Director [190]

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In November, it will be.

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Mahrukh Adajania, IDFC Securities Limited, Research Division - Director [191]

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Okay. Okay. Got it, sir. Sir, in Religare, which is on the ICA list of accounts, which company of Religare do you have exposure to?

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Neelam Damodharan, Bank of India Limited - Executive Director [192]

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Finvest.

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Operator [193]

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The next question is from the line of Sushil Choksey from Indus Equity.

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Sushil Choksey;Indus Equity;Analyst, [194]

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I was looking at your Slide 14 on the NCLT accounts. NCLT 1 and 2, we are hopeful of a major recovery in this quarter and the next quarter. And are we estimating 70%, 60% there?

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Neelam Damodharan, Bank of India Limited - Executive Director [195]

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Yes. Sir, can I get your question? Can you repeat?

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Sushil Choksey;Indus Equity;Analyst, [196]

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NCLT 1, we have INR 3,712 crores outstanding. NCLT 2, INR 2,781 crores. So I'm quite sure there's S R Steel, Ruchi Soya and few others comprising of this list. What is the percentage of recovery, which we are estimating on these 2 in the next 2 quarters depending on the court?

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Neelam Damodharan, Bank of India Limited - Executive Director [197]

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In this, as we told, we are expecting recovery in 7 accounts. The total outstanding in this is around INR 4,000 crores and likely recovery around INR 2,700 crores.

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Sushil Choksey;Indus Equity;Analyst, [198]

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Okay. So if I move away from NCLT 1, 2, accounts filed by BOI at NCLT of INR 5,700 crores, what is the provision which we have? And what is your estimate of recovery period in this amount?

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Neelam Damodharan, Bank of India Limited - Executive Director [199]

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In this, NCLT 1 and 2, both we have 100% provision.

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Sushil Choksey;Indus Equity;Analyst, [200]

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And NCLT accounts filed by BOI NCLT, which is INR 5,762 crores?

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Neelam Damodharan, Bank of India Limited - Executive Director [201]

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87% is the provision.

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Sushil Choksey;Indus Equity;Analyst, [202]

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What is the estimated recovery -- projected recovery?

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Neelam Damodharan, Bank of India Limited - Executive Director [203]

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They are a large number of accounts, 176 accounts. But in these 2 quarters, in all the NCLT cases put together, the recovery, what I told, that is what we expect as of now.

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Sushil Choksey;Indus Equity;Analyst, [204]

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Okay. On the overall scenario of INR 32,756 crores, looking at NCLT 1, 2, NCLT and all others, can we roughly estimate that 40% to 50% of the amount will be recovered over a period of 12 to 24 months?

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Neelam Damodharan, Bank of India Limited - Executive Director [205]

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Yes, 12 to 24 months, if you're giving the trend, yes, we hope so.

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Sushil Choksey;Indus Equity;Analyst, [206]

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Okay. Now looking at the business stable number, which is a heartening thing for the performance currently with the equity and the current stability, where do you forecast your gross and net NPA, if I look at 1 or 2 years out from current situation?

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [207]

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Yes, that's what you're looking at, the NCLT getting resolved, 1 and 2, and then we are looking at other NCLT cases what we filed getting resolved. That amount coming in, in 1 or 2 years, then the gross NPA levels should be -- substantially should be low.

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Sushil Choksey;Indus Equity;Analyst, [208]

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So gross NPA, assuming that much, much faults are happening -- defaults are happening barring Dewan and some 1 or 2 other cases, can the INR 61,000 crores be visible in the vicinity of INR 35,000 crores to INR 30,000 crores and the net NPA in the vicinity of INR 10,000 crores?

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Neelam Damodharan, Bank of India Limited - Executive Director [209]

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Certainly, for the range of time that you've talked about, below INR 40,000 crores, now we should certainly look for.

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Sushil Choksey;Indus Equity;Analyst, [210]

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Any internal target set out, sir, on a 12- to 24-month basis?

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Neelam Damodharan, Bank of India Limited - Executive Director [211]

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Not 12 to 24 months because this is a very dynamic, what I call, development. It depends upon the various developments. And certainly, for the Q4, what I told is we are aiming for bringing it gross NPA below INR 58,000.

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Sushil Choksey;Indus Equity;Analyst, [212]

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Okay, sir. Now if I ask you on the next slide basis on the asset quality, where do you see your PCR number at the end of the current financial year? What is your set target? I'm sure that you've set a target for provisioning for the next half based on the recovery to show our balance sheet on a better number. Where would you be headed?

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Neelam Damodharan, Bank of India Limited - Executive Director [213]

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From now onwards because we are at 77%, the PCR is -- we are comfortable and much higher than the industry average today, what including private sector banks, what it is 70%, and public sector banks 75%, we are at 77%. What the provision we'll be making ahead is only the normal IRAC norm provision. So we will not be -- the requirement will not be there for making any aggressive provision further.

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Sushil Choksey;Indus Equity;Analyst, [214]

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So we are satisfied with the current number.

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Neelam Damodharan, Bank of India Limited - Executive Director [215]

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Yes.

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Sushil Choksey;Indus Equity;Analyst, [216]

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Okay. Now sir, looking at your gross NPA, net NPA and 10% growth on the balance sheet, do you see any operating leverages to increase your NII over a period of next half or the pricing power is not with the bank?

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Neelam Damodharan, Bank of India Limited - Executive Director [217]

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Certainly, we look forward for leveraging this scenario because though it is linked to report nowadays -- now was -- from 1st October, that is limited as of now to home -- retail loans under SME and, again, whatever the future sanctions that is happening, right? It will take quite some time for it to encompass the entire portfolio. That is one. And secondly, we -- as you have seen, though the advances -- top line has not increased in the Q2, but the interest earning has improved quite reasonably. And we'll look forward for such a trend to continue because with the reduction in NPA, that is one thing, aiming -- what we are aiming for. And second is pricing for the bank's interest benefit for -- to gain the interest advantage, where the pricing will be looked into very closely in all the cases. And third is whatever the growth, 10%, again, here, the RAM also will be forming part of it, there the pricing will be much better, all these things put together. And liability side, cost reduction will be there. And this all put together, the NIM will be -- we aim the NIM to be above 3%.

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Sushil Choksey;Indus Equity;Analyst, [218]

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So the NIM will be sustainable over 3% in the second half, and you're saying cost-to-income would be below 50% or somewhere in the vicinity?

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Neelam Damodharan, Bank of India Limited - Executive Director [219]

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It will be in the vicinity of 50%.

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Sushil Choksey;Indus Equity;Analyst, [220]

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Okay, sir. Last question, if I ask. Corporate credit growth, which is 5% to 25%, Mr. Chaitanya highlighted, we would be doing it in a predominant unless we get greenfield projects. Between retail and corporate book, what is the mix estimated in that 10% growth?

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Neelam Damodharan, Bank of India Limited - Executive Director [221]

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Right now, the mix is around 51%, 49%, 50-50 is there -- the loan portfolio, RAM and corporate group. We can expect it to be on a similar line.

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Chaitanya Gayatri Chintapalli, Bank of India Limited - Executive Director [222]

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Yes, yes.

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Sushil Choksey;Indus Equity;Analyst, [223]

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And are we working on retail as pure from our branches? Or we're doing more of co-lending or what structure are we talking about?

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Neelam Damodharan, Bank of India Limited - Executive Director [224]

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Co-lending, we have started exploring, but it has its own hiccups in the beginning. But we are looking at that avenue also. Meanwhile, we have a very robust setup with the branches as well as our retail hubs as well as MSME and agriculture. Those, we will be focusing because they are specialized agencies for these segments. We'll be focusing on them also. Because in the past -- last year also, we have grown at around 20% in home loan. And by activating and keeping -- sustaining the momentum, we will be able to go ahead in that direction. Meanwhile, we are also exploring the coordination as well.

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Sushil Choksey;Indus Equity;Analyst, [225]

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So what's your outlook on the international book? Are you degrowing or...

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Neelam Damodharan, Bank of India Limited - Executive Director [226]

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No, compared to last quarter, we have grown. We have gone up to INR 55,000 crores now. And we are looking at loan syndication as well as ECB opportunities there. So it will -- again, it will be totally -- most of those cases will be -- unless it is India-based companies, it will be unsecured. So there we'll be having a little restriction. Otherwise, we will be looking at opportunities to grow in international book also. Even our NIM -- international NIM also has grown this time quite considerably. It has been a 30% increase there. We'll look for...

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Operator [227]

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Next, we have a follow-up question from the line of Ashok Ajmera from Ajcon Global.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [228]

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Sir, I was just going through this segment-wise results. Sir, there is a -- I mean a lot of -- if you say the differences quarter-to-quarter and it's difficult to understand. Like in case of the wholesale banking operations, the loss during the last quarter was INR 2,278 crores something and now it is INR 597 crores only. Same way, the retail banking, the profit was INR 1,908 crores, which has come down to INR 440 crores. I think Mr. Raghavendra will be in a position to that -- what is the reason that for such a divergence in the numbers quarter-to-quarter in segment-wise results?

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Kollegal V. Raghavendra, Bank of India Limited - GM & CFO [229]

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Ashok, what has happened is in some of the segments, like has been regrouped actually. It has been regrouped. That is why you see the difference. Otherwise, it is -- there is not much difference, except for regrouping.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [230]

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Because even in the revenue also, forget about profit, there also the allocation of, I mean, the income is -- I mean it doesn't give a proper picture like INR 4,163 crore versus only INR 1,177 crore.

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Kollegal V. Raghavendra, Bank of India Limited - GM & CFO [231]

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That's because of the regrouping.

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Ashok Kumar Ajmera, Ajcon Global Services Limited - Executive Chairman, CEO & MD [232]

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All right. I mean some more light if it can be thrown on this maybe later some time. We can exchange mails. Just to know the exact position because the segment also gives you some idea about the...

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Kollegal V. Raghavendra, Bank of India Limited - GM & CFO [233]

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All right. Do one thing, we'll give you by mail the further details.

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Operator [234]

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Thank you very much. That was the last question in queue. I would now like to hand the conference back to the management team for closing comments.

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Atanu Kumar Das, Bank of India Limited - Executive Director [235]

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Yes. On behalf of Bank of India, this is Das, along with my colleagues, Executive Directors, Mr. Damodharan and Mr. Chaitanya, on behalf of Bank of India, we would like to express our sincere thanks for indulging in such a good interaction, pointing out certain suggestions and getting clarification from us. And we feel that we've been able to duly clarify all your questions and answers, and we take your suggestions on board, we'll work on it and with a fervent hope that, we will come out with even better numbers during the current quarter and subsequent quarters. Thank you, one and all, once again. Thank you.