Refused to commit on xpress credit disbursement absolute.

On profitability - last quarter had exceptional profit from Yes Bank shares sale. This quarter's profit matches last quarter despite that one-off. The investment profit and revaluation (baseline income Rs. 5,154 crores vs Rs. 2,897 crores) and forex/derivatives added Rs. 2,500-3,000 crores. What contributed to this profit?

The profitability in Q3 has come from many levers. I did mention in Q1 and Q2 that both on the growth side as well as on the profitability side, SBI has many levers and we will continue to use them. If you see our fee-based income, I think most of these segments have shown good growth i.e. cross-sell, up-sell, government business, LC business also is remaining, and fee-based income in terms of processing charges, and recovering written off accounts, and more importantly the credit growth across the segments. Apart from that, we also have focused on moderating the cost of resources, which has given the uptick in the net interest income. Net interest income growth of 9% is a combination of both, containing the cost of resources as well as the credit growth which has happened. If I have to talk about one-off, I think the one item which is a special dividend we have received, around Rs. 2,200 crores from SBI Mutual Fund. Even to net off this one-off, I think we have done fairly well in every area. And also, the modest credit costs contribute to the uptick in the profitability. We also focused on moderating the operating expenses. While our staff costs are broadly rigid, we try to reduce the cost of overheads and that also has been one of the reasons why you see the good profitability. And the credit growth advice, we had given 12% to 14% credit guidance earlier, we are revising that upwards to 13% to 15% for the current quarter. We will give a full year guidance when we meet again in Q1. But for the current year, this current quarter we are revising our credit growth estimate to 13% to 15% based on the trend which we have seen in the current quarter so far. Segment-wise credit growth, I think the growth has been secular, if you see the slides. Particularly, we had given the guidance that we would be having a double-digit corporate credit growth in Q3 and we hope to continue that double-digit growth in the corporate side in Q4 also, which means that RAM would significantly be contributing to the growth. We also see that corporate book growing in double-digits, which means that our guidance of 13% to 15% is coming from all the segments. Non-NPA provisions, the COVID provision, Rs. 3,500 crores is continuing, and there are some proactive provisions which we have done account specific, but this broadly is also standard asset provision. So, the idea of presenting this is that we have the ability to take care of any untoward incidents and the way we want to manage the balance sheet. It's not that this is being built for the ECL, that's not the idea.

On AUCA recovery strategy - AUCA pool of Rs. 1,62,464 crores broken as: beyond 10 years Rs. 23,000 crores, 5-10 years Rs. 87,000 crores, below 5 years Rs. 51,000 crores. What is the recovery strategy by vintage bucket?

In the recent slippages, you would definitely have better recoveries. In fact, much of the run rate what we are witnessing around Rs. 2,000 crores per quarter, is also coming from the recent slippages i.e. recent write offs, which means around 2 to 3 year old. You're right, I think less than 5 year written off accounts will have a better recovery. But the most appropriate way is to look at the portfolio level. And what we have given earlier guidance also, we are still seeking 6 to 8% recovery, which is possible in this portfolio, not beyond that. While the age-wise there could be some higher recovery and low recovery or there could not be any recovery at all in some of the accounts, it is better to assume that we are looking at 6 to 8% recovery overall. So, I think we still stick to that guidance, Ajmera saab.

NIM outlook for Q4 and longer term - earlier guidance was NIM would be about 3% in Q4. Does that still hold? Is there scope for cost of funds to come down further?

On the NIM front, we're still sticking, without calling it a short term, long term NIM. We have said that the exit NIM for the current year would be about 3%, and our long-term guidance is 3% through the cycles. I think we'll stick to that. There could be some upside here and there, but it is fair to assume that about 3% guidance holds good, both for the Q4, that means FY 26 exit NIM and FY 27-28 NIM also. We are sticking to that 3% guidance.

CVE income has grown very sharply QoQ and YoY - any comments? And what was the interest on income tax refunds for this quarter and last quarter?

On the CVE income, there has been good growth in terms of Life Insurance. The GST benefit we have seen. The number of policies sold has also increased, which has contributed. And also, the trail income from the mutual fund has gone up. So, there is a secular movement in terms of the CVE. CVE is basically the cross-sale income. That has been a good growth story. We also enhanced the number of products which are made available through our counters and on the YONO channel. That also has contributed to the growth in the CVE income. Interest on income tax refund: Quarter 3, interest on income tax refund was Rs. 769 crores and the similar amount last quarter was Rs. 372 crores.

Cost of funds - scope for deposit cost to come down further?

I think, what we have done strategically is that we focus more on the retail deposits, we have not moved to the wholesale deposits. Even in the wholesale deposits, we moved more into bulk card rate deposits. That means they are almost equivalent to the retail term deposit rates. We have seen a good growth on the card rate, we have not gone aggressive on the differential interest rate or high-cost deposits. That has also helped us in terms of containing the costs. But we should also remember that 39% CASA at this level is also contributing to bringing down the costs. We got the full benefit of Savings Bank reduction in interest rate to 2.5. Current account 10% growth rate is also helping us to contain the cost of funds. Broadly, the cost of funds will remain at this level for the Q4 also. We do not want to go beyond Q4, I think we will take a call in the Q1.

Cost of funds may remain stable - is it because bulk deposit rates in the system have shot up in last 2-3 months? Otherwise, retail deposits should keep repricing from June-July actions?

No, the retail term deposits are also high even after repricing. See, broadly, the book has got repriced. Only last reduction in interest rate will be available for another 6 to 8 months, probably the repricing will happen. What I am seeing is that the stabilization of the interest rates on the retail term deposits also, there is nothing much we will be able to reduce. And that shows again, what kind of deposit mobilization we need to do going forward if the credit growth comes. So, Q4, I think broadly the numbers remains. There could be some repricing going forward, because what we have done in the last quarter, the interest rate reduction, will play out for some time. But I broadly believe that the reduction in the cost of funds is unlikely. We will be maintaining at this level, maybe if we are able to mobilize a little more current accounts, generally which happens in the Q4, it may help us to moderate the cost of funds.

Gold loan - 95% YoY increase. Is this entire organic or some reclassification from Agri-gold to retail gold? What are risk mitigants - origination LTV and book LTV given prices rising one way?

We do a deep dive on this portfolio every day. We monitor the LTVs. There was some shift from Agri-gold loan to personal gold loan, but it shifted back after RBI clarified on the Agri-gold loan. I think that shift is not happening too much. So, I think that is not a major worry. And the personal gold loan LTVs, it's not only about the portfolio LTV. Sometimes portfolio LTV could be misleading, because some two years ago somebody has taken the gold loan when the price was low, then the outstanding versus the value would be significantly lower. But we bucket them, both on the vintage as well as in terms of the amount. We see that the LTVs are extremely modest and we have sufficient room in terms of the LTVs. For instance, I think in Agri-gold loan, the average LTV is 54.89%, and in case of personal gold loan, it is 51%. Even if you take the latest vintage also, we don't go overboard on the LTVs, there is an adequate margin available on them. Another data point which I would like to give to you is that the number of gold loans auctioned is just about 20-30 in a huge portfolio of gold loans what we have. That means even if the price fluctuation is there or the margin, if you have to ask someone the margin call, we do not call it margin call, but we found that nobody allows this account to become NPA. They just ensure that they pay off the loan. So, this portfolio is holding up very well. There is no concern on this. Agri-gold loan as on December is Rs. 1.44 Lakh crores.

RBI reduction cycle bottomed out, interest rates could be flat to upwards. How do you see the rate cycle and credit outlook balancing given trade deals, GST and budget benefits?

On the credit side, I think it's extremely positive. One is, the system itself will get benefited with the positivity, which is created on the trade deals, on the GST, on the income tax, on the monetary measures what have been announced. More importantly, SBI is well positioned in capitalizing on all these positive developments. That is also one of the reasons why I have given the revised guidance on the credit growth. So, if you see even budgetary announcements on the infrastructure side, and we are also looking at what kind of infrastructure guarantee which will come. MSME, for instance, the CHAKRA what I mentioned in terms of the sunrise sectors, many sectors have been mentioned in the budget itself. That means, our thought process is completely aligned with what the government initiatives are. So, to that extent, I think SBI is well positioned. We also are a very large player in MSME with 15 to 16% market share and growing. I believe that SBI will get benefited in supporting MSME growth, on the champion MSMEs. Even before the government announced champion MSMEs, internally, we have started categorizing, which are these MSMEs which have huge growth potential. We try to categorize them into platinum, gold, and support them proactively in terms of their growth technology and the market linkages. So, many things what we are trying to do with MSME, aligns well with the positive developments which have happened. So, I believe that we are on the right path in terms of the credit growth, and we are on the right path in terms of, both in India as well as cross-border opportunities which will emerge on account of these trade deals.

Data centres, renewables, nuclear, shipbuilding - are we seeing green shoots for large project financing (Rs. 30,000-50,000 crore ticket sizes)? Any early signals from SBI Capital Markets?

We are active in data centre financing. The mega data centres which are announced, still have to come with a business plan. But I think wherever data centre capacities are being created, we are part of that journey. In terms of the other sectors, you are right, I think there will be a good amount of demand for green energy for these data centres. Renewable energy is one of the important segments which we are focusing on. Incidentally, our green portfolio has reached Rs. 1 lakh crores, which constitutes renewable energy predominantly. Which means that these growth opportunities are definitely being considered by us.

Can CVE income double in 3 years?

Our idea is that we set a target of billion dollars for CVE income. If the rupee stays where it is, I think we should be able to reach that $1 billion CVE income soon.

With trade deal-driven corporate expansion and balance sheet capacity, where could LDR ratio go with credit demand? If corporate loans grow, do they drag NIMs or can CASA growth offset that?

If you see in the Q3 performance, we have had almost more than 15% corporate credit growth. We have not compromised on the margins. We have ensured that the NIM guidance what we have given is maintained despite 13% credit growth coming from the corporate side, which means that, philosophy of pricing the risk properly will continue. I think we never deviate from that. We also have ensured that the ecosystem banking in the corporate side is strengthened further. Today, I just want to tell you an inside story that any corporate underwriting today, we have a checklist of 22 items which we monitor, whether we have clear engagement on these 22 non-funding areas. Whether it is cash management, whether it is salary accounts, whether it is letters of credit or foreign exchange. So, the awareness on the operating level has moved from corporate lending to corporate banking, in a very significant manner. And the sensitivity towards this engagement is intense now. Which gives us confidence that even if we have to compromise on some pricing on a corporate, it would be purely based on what is the value which we are generating from the corporate. So, I do not think we should have any concern in terms of margin compression with the corporate growth book coming back in a very significant manner, as we approved in Q3 also. We are very sensitive to the value creation from our corporate relationship. On the LDRs, I mean the credit deposit ratio, I think we do not want to give a guidance. Obviously, it is an evolving situation. In the short term, we are very confident that the credit growth, whatever we are envisaging 13% - 15% will be comfortably be met by our liquidity as well as capital ratios.

3.2% increase in LDR this quarter but NIMs broadly flat - working capital drawdown is low-yielding, but shouldn't higher LDR translate to better NIMs?

3.2% LDR is also coming from the working capital drawdown. Typically, working capital loans do not give the yield pickup as much as you expect. It is not coming from the term loans alone. So, the working capital loans are reasonably priced, and these are high quality exposures, which is also one of the reasons. And one more important thing which I keep talking about is, you look at our RWAs. Despite this growth, we have not significantly enhanced our RWAs. That is also one of the reasons why you do not see the commensurate pickup in our margins. We play very cautiously on the risk side also.

December rate cut is struggling to pass through on the liability side - there should be transmission from Q4 last year to Q4 this year on deposits. How do you see that puzzle?

December rate cut has not resulted in any repricing of deposits. So, technically that transmission did not happen on the deposit side. Well, it had happened on the asset side. So, the overall transmission if you see, I think the Governor has also mentioned on the stock it is only 45 basis point. And on the incremental deposits, I think the passing on of the interest rate on the deposits would be around 90-95 basis points is something what happened. The full transmission is unlikely to happen on the deposit side. So, the repricing which benefited, I think 75 to 80% repricing has already happened. It will reflect in this quarter definitely. But it may not be very significant, that is what I was trying to say.

Branch expansion globally in US and EU with trade deals - scope for more than doubling international branches in three years? Also thoughts on corporate bond market deepening, SBI Mutual Fund IPO timing, and the CFO appointment process.

On the expansion, overseas expansion, most of the geographies barring New Zealand, where the FTAs or trade deals are signed, we have a good presence and very large presence. For example, US - New York branch is the largest operations for us. In these jurisdictions, we are broadly the wholesale bankers. I believe that trade deals are going to help us mostly in the corporate and MSME funding, which is an opportunity which is available locally here. We would like to definitely take that opportunity. Any of these corporates accessing the overseas market, we have presence across geographies here. Our ability to fund those transactions either by way of trade finance or by way of ECBs is very large. I do not think we need to look at branch expansion. In the EU area, we have two fairly large branches, one in Frankfurt and in Antwerp. These branches are taking care of the overall requirements. In the US, if you see, we have wholesale banks, both in New York and Chicago, and Los Angeles, and we have retail presence in the whole of California. That is where I feel that some expansion in the retail side is potentially possible. We are expanding, for instance, we will soon be opening a branch of SBI-California in Dallas, because they can open multi-state branches. So, I think we will be selective in terms of physical expansion. We also would like to use our YONO Global, which is a digital app across the geographies, almost in 11 to 12 geographies, we have already launched YONO Global. We would like to build retail presence through YONO Global, not by opening the physical branches. So, on the overseas expansion, I do not think we will be aggressive, I want to be clear on that. The corporate bond market, I fully agree with you on that. We have been talking about corporate bond market deepening for so many years. There are many reasons. But it is time now the corporate bond market has to become vibrant. Our participation in corporate bond market is based on what is our credit growth. If there is a loan growth requirement, our priority is to fund that loan growth. But we also have a mix. If you see all our large corporates have loan limits as well as investment limits, which facilitate us to put the corporate NCD subscriptions. But one more development what probably would help in terms of further strengthening is the partial credit enhancement, which is now allowed by the RBI. The partial credit enhancement will enable slightly lower rated corporates to access the bond market. Today, it is typically dominated by AAA companies. So, how do we bring A rated or AA rated companies into bond market, through partial credit enhancement is something what we are working on. Mutual fund, we are not fully exiting. So, we still have potential to monetize further when market improves. I see a great opportunity for mutual fund growth and SBI mutual fund will be playing a very, very large role in this.

Miscellaneous fee income - what is driving it?

Miscellaneous fee income is a very diversified income stream. But if you really have to put, I think some of the major ones is cash management services what we provide, and also, the mobile banking charges which we collect, account maintenance charges for non-savings bank customers, annual inspection charges and host of other charges. These are all diversified income stream. We also adjust it for the GST payment which happens. So, that is a net figure which is shown here.

PSL catch-up on SMF and weaker section - at 14-15% credit growth, do we see shortfall and drag from IDF investments? And on CA - sequential decline this quarter despite 10%+ YoY growth; is there market share loss on CA front?

The Current Account, we are predominantly seeing on the private side, despite actually the significant decline on the government business, is virtually drying up on the government current account. So, in the last one to two years, we focused completely on the private side business accounts and that has given us current account uptick. And Current Account also is not a quarter end or month end phenomenon, we monitor in terms of the daily average balance to a quarter end number and it is very robust. It is more than 80-85% which means that your daily average balances are holding up. So, there will be a month end and quarter end movement which is unavoidable, but we are very comfortable in terms of this ratio that you know your daily average balance to quarter end balance. The other one is in terms of PSL. PSL, as you grow the book, PSL pressure will come. We have been addressing that in various forms. One is the organic growth PSL targets are given to every business segment including the corporates. We know that we do lot of on lending to lot of NBFCs where they qualify for PSL and we are clear monitoring. In fact, what we suggested that if an NBFC/MFI is there or NBFC is there which has got a PSL only funding which is from us, we are willing to give some discount on our rate which means that we would like to prevent the bleeding on the PSLC side and we broadly are able to do that. The subsegments which you mentioned definitely are the concerns for everyone, the small and marginal farmers, because the whole portfolio is very small and our requirement is 7.5% of the overall portfolio. I think it is creating an imbalance, and we also do not want to aggressively push up the PSLC purchases. So, that you know year end PSLCs will push up the premium. What we have done is that we have front loaded our PSLC purchases in the Q2 itself. We virtually have not moved to PSLC market in Q3 at all. So, we do lot of things in terms of reducing the PSL burden. Hopefully, I think the new guidelines, there are some positives. We are just evaluating how the PSL movement will happen in our book.

LDR expansion with low-yielding corporate and SME growth - is PSL cost factored in at the time of doing that business?

Much of the SME growth is in the qualifying PSL category. So, MSME growth is not a worry. But I think on the corporate credit growth we definitely consider various cost factors. While we do primarily look at the risk involved and how do we price the risk, we also look at our cost of funds and what is the alternate mechanism of investing those funds. We have a simple mechanism called risk adjusted return on capital. I think we did mention earlier. The capital optimization is also core to our pricing strategy. The PSL cost many a time is worked out on the portfolio basis not on an individual account basis. Those costs are definitely accounted for.

No plans to tweak MCLR from current level?

No, MCLR is an arithmetical calculation as long as the cost of deposits remain at that level. I do not think MCLR. We are not tweaking cost of deposits in any bucket. So, at this juncture neither we are considering any tweaking on the deposits, ALCO will take the call, but I do not think any MCLR movement is likely to happen in near term.

Employee provisions are 25% lower QoQ and 32% lower YoY - what is the reason? Any impact from new labour codes?

We did the assessment of the new labour code. There is no noticeable impact because our wage structure is broadly aligned with the labour codes. That means no impact except that there is a requirement of providing for gratuity of contractual employees who have completed 1 year. Earlier it was 5 years, it has been reduced to 1 year. The net impact is only 16 crores provision which we had to make. So, I think we are broadly in alignment with labour codes, but we are also looking for the rules/regulations to come and if any assessment is required to be done, we will do. But I do not think there is going to be any impact on the labour codes. The first thing you asked in terms of provisions, essentially the provisions have come down on the staff expenses, provision for pension. These provisions are based purely on the actuarial assessment, and the discount rates have moved up which means that the requirement of provision has come down.

Cost - last two quarters very controlled cost growth, OPEX slightly declined, loan growth guidance being raised. How do you see cost-to-income ratio playing out over next 2-3 years?

So, the credit growth is not substantially going to enhance the costs, the operating costs at least. Maybe, you know, we would like to manage the interest costs, as I mentioned, in terms of moderating the cost of deposits, focusing on the CASA. Our objective is to keep the cost to income ratio below 50 bps. I think that guidance we had earlier given, we are sticking to that guidance.

ROA - nine months tracking higher than 1%. Will you review the 1% ROA guidance? What further levers could take ROA higher?

I think we still stick to that 1% guidance. I do not want to jump the gun at this juncture. It is playing out well. And we also are mindful of our RWA density. I think this is something which we are very conscious about that, which means that you cannot have a jump in the ROA. We want to be consistent on the ROA front. I think the guidance will remain at 1%. There are quite a few levers. But I think the levers point out that, we will maintain this 1% guidance through the cycles. I think that is very important too. We are not giving the guidance only for one quarter or one year. We said our guidance is 1% ROA through the cycles.

Private capex - last time you said it is improving. With corporate growth revival, will it further pick up and what is the pipeline in corporate book ahead?

So, the pipeline is Rs. 7.86 lakh crores with sanction but not disbursed about Rs. 4.4 lakh crores and the pure without sanction pipeline Rs. 3.45, that is the total undisbursed plus pipeline. Pure pipeline is Rs. 3.45 lakh crores. In terms of growth in the corporate side, yes, you are right, we are seeing pick up and two new things which will help us next year one is the announcement by RBI on REITs, that is a market so far we were not allowed to, that's a large market and growing fast. We hope to develop something there. And also, M&A guidelines finally when they come, we hope to do that as well. Those two will help us to give more basis to increase the corporate book and with better margins because both these segments are better paying than some of the other segments. We are also seeing other pick-up happening in the corporate side especially in power including renewables, metals and also infrastructure.