City Union Bank Ltd Q4 2023 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : When you're guiding for a NIM of around 3.65% as 10 basis points FY '24 and an ROE, which in 4Q was around 1.3% ROA -- so -- and we are guiding for a 1.5% kind of an ROA for FY '24. So just want to understand what will drive the ROA improvement? I mean 1H also we have added for a (inaudible) [overall] profitability, which is the last year 1H.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : Sir,what would be the expected credit cost that we are building in for this? For FY '24.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : So this would be on the net slippages that you're seeing, (inaudible)

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : So sir, a great question fall down to 50, 60 basis points for FY '24.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : And sir, secondly was on the loan growth. So for FY '24, like when you're talking about the back-ended growth and the target 12% to 15%. So just wanted to understand, like, are there any new products that we would look to launch or any geographical expansion? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 26, 2023 / 12:30PM, CTBK.NS - Q4 2023 City Union Bank Ltd Earnings Call Or this is going to be mainly coming from the same geographies and the same products portfolio that we are operating in. And when you're saying the growth will be back ended in the year, so what kind of growth one can expect in the first half on vis-a-vis the period-end number of FY of March '23 a number?

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : Sure, sir. And lastly, the question I want to ask was that on this approval rate of 25%, so is it a function that the proposals that we are getting from the market right now are not credit worthy enough to be sanctioned? Or is it just that from a process perspective, we continue to remain slightly more conservative and that's where the flow rate is low.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : Sure, sir. Sir, just one more question on margins. So when we say that we'll probably, for the full year next year, we will have [exact] ROAs similar to [exact ROAs] that we saw for FY '23, which is 3.65% plus minus 10 basis points. And on the other hand, we also say that probably because of deposit costs rising, there might be some pressure points in the initial one. So how exactly we are going to maintain because if the -- we are going to see some value cater in both half and how exactly we are going to maintain exit run rate of 3.65% because there will be some downside which are there.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : Got it. And just one last thing, in terms of recovery from return of accounts, what was that number for the full year FY '23? And how do you think that particular line item place in FY '24.

Question: Rohan Mandora - Equirus Securities Private Limited, Research Division - Analyst : I am Just trying to understand in terms of the account aggregator and the ONDC, how are we placed right now? Or is it the BCG project that we are doing is with respect to -- getting on board with respect to many of these things? And especially, as we understood many of the large private sector banks are -- have made a significant development and that is helping them gain almost 25% to 30% growth in the loan segment which is our core focus area. So the point which was asked earlier in terms of the competitive pressure, are we seeing competitive pressure emerging from those kind of lending as well by just taking market share from us?