Sir, just in terms of margins, what is your outlook on margins near term and longer term as well? Because this quarter we did see that NIMs, global NIM in the quarter declined around 18 bps. So, what is the outlook going ahead? Maybe first half and then longer term also.
But I would like to give guidance for the full year, Mahrukh, and as I promised, I said that I will give first quarter itself the full year guidance. We do not want to create confusion in terms of quarterly guidance. Because the quarterly, in a large book like ours, there is a seasonality, there is a momentum of credit growth. It is very difficult to give a guidance on the quarterly basis. We are still giving a guidance on an annual basis. We are sticking to our NIM of more than 3% for the full year, for the full year.
If you could give the breakup of gross slippage for Q4-26 and Q3-26. So that is one question. And the other question I had is that what is your total Middle East portfolio? What is the India linked Middle East portfolio? Like some Indians working abroad may have taken home loans, etc.
So, I will answer the second question first. I think that is on many people's minds, you know, what is happening on the Middle East. The Middle East, we have two large offices, Bahrain and DIFC, Dubai. But the other operations are very small Bahrain retail operations and Dubai, we do not have any retail operations at all. So primarily, it is a wholesale book. And out of this, it is predominantly either a bank exposure or a sovereign exposure. In both these cases, we do not see any concern on that. We don't have any much direct exposure either to the medium enterprises or even corporates. So, I don't see a great impact coming from the corporate side, wholesale book side. And the retail side where the people working in the GCC taking the housing loans, it is predominantly in Kerala. The rest of the country is not concentrated. But we have not seen any impact on the asset quality, particularly on the housing loans. Gross slippages anyway we don't ever give. It is always first quarter which gives gross slippages and subsequently dissolved net slippages. But there is absolutely no predominant movement of any concern in the slippages.
G-sec yields have moved up, but our investment yields are slightly lower. One would have expected that the yields for us also would have tandemly moved up in the quarter. Is that we have moved some of the securities and booked some gains? And that's why the losses are slightly lower or any other?
Yes, some trading has been done. If you see our trading profits have been good this this quarter also. So that means, that some of the switches we have participated in that, which also had portfolio yield moderation. I mean, it depends on what securities are asked by the RBI.
There were news articles that, RBI has asked oil companies to move, they're buying dollar buying and selling through our bank and also, you know, related FX related transactions to our bank. What is, how is that going to benefit us? Any outlook on that?
I'm not aware of this.
On value unlocking from NSE stake (over 10% in National Stock Exchange) and market share strategy - thought process on capital deployment from value unlocked, increasing market share from 20-22.5% towards 25% via rural/district/branch route, globalization opportunity. Compliments on Rs.25,000 crore tax contribution.
Yes, of course, I know you. But I wish I own 10% of NSE, unfortunately we don't. Within the group we have around 7.3% holding. But Bank itself would be keen on participating in the OFS. We have given our in-principal consent to them. What kind of participation will happen, the board will determine. But as you mentioned, I think the moment NSE gets listed, the whole shareholding by SBI will be available as reserve to us to mark to market. Currently, it is not marked to market in our books. Yes, I think several times you yourself have mentioned the hidden reserves what SBI has in terms of strategic investments and this year I think if NSE gets listed, that unlocking will happen. We are also seriously, as you are aware, we have embarked on listing SBI AMC and hopefully in this financial year we will be able to complete, which will result in capital augmentation, CET-1. That's what I think it gives us confidence that going forward two things which are required for supporting the credit growth, in terms of capital we are fully convinced that we have the capability. Even with the current position we can fund almost 12 trillion credit growth. Further augmentation will help us going forward and enough liquidity in the system. So, your second question, I think is a very important question, that when you have such scale and such dominant market share, how do you grow further? We have now embarked, I think I must have mentioned last quarter also, that we want to increase the market share in every district. Our strategy is that even if in a district you have a dominant market share of 60%, our guidance is that 1% increase in market share, whichever is that, whether you have 10% market share or 60% market share. Every district we would like to grow 1%. 25% is a little farther, but we would like to move 1% every year, that means 4 to 5 years. As I mentioned several times, we would like to be 25% in terms of the GDP of the country. Through the cycles we would like to ensure 15% return on equity to our investor's minimum.
You will be saving on DICGC premium next year, right? What you paid this year, we can calculate the rest.
Don't ask me the number. I will lose my job. Sorry, as per the regulation, we are not supposed to disclose that. We will get benefited definitely, but this is not a disclosable item.
Global transformation is a necessity for India led by war. Maybe business mixes are changing. I personally sense there is going to be a big Capex boom in India led by energy. So, we need renewable, we need nuclear, Data centre needs lot of energy. The Middle East attacks on Amazon may divert lot of data centres to India. The transmission line expansion needs big growth. Any kind of indication or lead time which you are already sensing because these ticket sizes will not touch base with a bank which is not of a size. And SBICAPS will have a big role.
So, I will answer that and I will also ask Ashwini to respond on that. Transmission, yes, I think is going to be one of the most important infrastructures which is going to be developed. Some of the projects are fairly large as you mentioned. We have been having discussion with them. What kind of structures they will come out is not very clear yet. Whether there will be an SPV or it will be done by their own companies. But there is a good opportunity coming up there. And apart from transmission, we also see lot of emerging sector. I think last time also I mentioned we have started an initiative called CHAKRA. This is to support all sunrise sectors, whether it is green hydrogen or whether it is data centres, whether it is new renewable energy models which are emerging. Or even small modular reactors which government has been talking about, semiconductors. These are all the activities and sectors probably which have greater potential for investment. But they need a separate kind of structure. It is not a pure vanilla loan which they require. They may require a mezzanine funding, they may require equity funding. So, we want to handle that kind of composite structures through our CHAKRA.
When we do the calculated yield on advances, the decline has been fairly sharp. Now one of the reasons could be that the book was grown towards the end of the quarter. If I were to just move into 1Q and 2Q, I know that you don't want to give quarterly guidance. We're just trying to understand does it dip first and then starts moving higher? Or do you have a visibility of how this traction will look like?
I don't want I don't want to hazard a guess. I'm still sticking to my 3% annual NIM. But if you really ask me, I don't think there will be any further dip.
Comprehensive opening question covering Q4-specific drags: treasury operations loss / trading loss / MTM losses on treasury book of about Rs.3,500 crores, increase in overhead expenses of Rs.1,500-1,700 crores in Q4, slippage up Rs.1,000-1,200 crores, asking about forward profitability comfort, ECL preparation, and the new emergency line of credit guarantee scheme 5 (Rs.2,50,000 crores + Rs.5,000 crores for airlines) and its Rs.70,000-80,000 crore growth potential.
Ajmera Saab, you said few points, is it? But very comprehensive assessment what you have done. First of all, I think a few questions which are in your mind, let me first answer them. There seems to be some amount of, maybe we were not communicated enough in our Q3. I believe, I have gone through my transcript again in Q3 analyst call. We made it very clear that our exit NIM is going to be 3% and we also mentioned that in the Q3, December 15 repo rate cut will be having full impact in the Q4, these things are something what we stated up front. What has not been known to all of us is the yield movement which had definitely impacted the treasury income. But even then, what we realized that, despite the sharp movement in the bond yields, because of our very low exposure to fair value portfolio, our hit has not been very significant. But you are comparing with the Q4 of the previous year, for instance, we have had Rs. 3,800 crores one-time gain on the security receipts. Apart from that, we had positive treasury gains in that quarter. I think overall, we all believe that we have given a good set of numbers for Q4 as well as full year. We stuck to our guidance in terms of 1% ROA and 3% exit NIM. One is slippages. Q4 slippages is not a matter of concern and from these slippages, we have pulled back almost 850 crores as we speak. That means there is no structural issue in terms of asset quality. So, there is no impact of West Asia so far and these slippages have nothing to do with any stress in the system. It is seasonal. Most of the slippages have come from agriculture and some from SME. We are sticking to our credit cost guidance of 50 basis points even despite whatever happens on the West Asian conflict. We are sticking to our credit cost guidance of 50 basis points, our credit growth guidance of 13-15%. Before ECL guidelines, let me also talk about ECLGS which is a proactive and pre-emptive measure in my view. My assessment of 70,000 to 80,000 crores is the full limit which is available to MSMEs and other non-MSME customers. Our assessment also indicates that not more than 30%, in the worst case 30-40% people will be utilizing it. ECL guidelines, we have made the models ready based on the draft guidelines. It would not be appropriate for me to give a number at this juncture. I think probably after the end of June-Quarter we will have much clarity in terms of, what is the stock which is required to be taken care of. Ajmera Saab, I don't want to hazard a guess at this juncture, let us stick to that. We are not going to give any number at this time. But one thing I want to make it very clear as I made earlier also, that this transition is going to be smooth. It is not going to impact our ability to fund credit growth. It will not be impacting our capital ratios as much and I hope we will be smoothly transitioning in the next four years in terms of the ECL guidelines implementation.
Firstly, just one clarification in NII. We do not have any impact whatsoever of any forex translation or any forex laws because I remember, years ago in a COVID quarter, we had some NII issues relating to forex as well. Just wanted to clarify.
No, it is a core NII except that the usual interest on tax refund which has come around 1000 crores which is added in NII. But it is partially offset because some of the penal interest which used to be booked in part of interest has moved to penal charges. But that is just about 600 crores. It is purely the impact of EBLR and some of the floating rate loans on the corporate side.
Follow-up clarification on India linked proportion of Middle East portfolio - Kerala home loans size, and Tel Aviv exposure.
What you said is right. So absolutely no concern as of now for us. The branches we have in Dubai and Bahrain, like the Chairman said, is wholesale banking business mostly we do. And Tel Aviv is mostly non-funded business, guarantee to be issued for Indian, essentially the defence kind of. So, the corporate book, what we have is 98% plus, is either sovereign, banks or sovereign-related exposures. We are not concerned about any corporate exposure in Middle East for these three branches. Globally also in exposure we have, India's total exposure will be 10-12 billion, including trade finance and all. But we are not seeing any concern on that side.
Sir, on your FY27, 3% plus NIM guidance, that is domestic or the global one, just to clarify.
So, our guidance is generally domestic. We are not giving wholesale, full bank NIM ever. Because the overseas book is a different creature altogether. We are talking about domestic NIMs.
Within this, there are two parts - yield and cost of funding/deposit. If I calculate this quarter, yield on interest on advances has been flat, 0.4% increase, whereas advances have grown by 5% QoQ. So, what explains the decline if I calculate this way, the yield on advances, they have declined by around 30 basis points. One is of course the repo rate movement. But apart from that, is there anything else which could linger? What is your thought process on yield on advances going ahead? Would they be similar, stable.
Yield on advances probably would have some uptick. What happened in the Q4, apart from the EBLR movement, see your EBLR plus floating rate loans other than MCLR in corporate book was 43% previous year. It has moved to 49%. That movement also actually creates. So, assuming that, our house view is that the repo rate cut is unlikely this year. Repo rate movement is going to be stable, which means that whatever we see on the spreads will remain. And on the corporate side, we are seeing how we can change the asset mix and reduce the floating link to T-bill essentially and bring back the yields to normalcy. Much of the loans, we have already started moving to MCLR in the corporate side. All loans which are getting repriced or refinanced are renewed today are predominantly moving to MCLR and reduce the floating T-bill rate linked loans. That gives us confidence. One is the repo rate being stable. That is no movement on the EBLR and the corporate book, which moved significantly towards T-bill, probably will be brought back to MCLR. Even without considering them also, we are confident that we will be achieving the 3% NIM because of the stability of whatever currently achieved.
MCLR will not reprice downward, right? And assuming there is no change in the card rate of the deposits, the cost of deposit should still decline right, in at least in the near term.
It will not be repriced, because we are not adjusting the interest rates on the deposits, either repriced lower or repriced higher is unlikely. So, there are two reasons why they will decline. One is, I think, we are focusing more on the CASA. CASA component will contribute to the reduction. If you see, even in Q4, we have contained the cost of resources. The other thing is that we, we have cut down significantly on our wholesale deposits, which are expensive. We will further be cutting down on the wholesale deposits, which gives us some relief on the cost of resources.
On LCR, if you can highlight what was the LCR during the quarter, Q4 and, you know, after these guidelines, which have come in from April 1st, how does that changes? And what would be your floor and maybe the upper limit for LCR to operate in?
For the quarter, it was 124 point something, 124 approximately. That was the average for the quarter. That the liquidity is being consumed, you are growing at 17%. But the current guidelines will give us around 3 to 4% improvement in LCR. See, for a bank of our size, we would like to have at least 10% to 15% over the regulatory minimum. Regulatory minimum is 100% so, 115%, I think, is a good ratio to have. Today we have, as we entered the year, around 125%. And in this quarter, again, it will move up further. If the credit growth continues, some moderation will happen in the LCR. We would be comfortable around 115 to 120%.
On the loan processing fees. It has been quite strong this quarter, almost double, I think. What has been the reason for that because loan growth has been strong throughout the year. But suddenly this quarter we saw that growth.
Pritesh, thank you very much for asking this question. I was just waiting for someone to ask this. Everybody is worried about NII. See, I think, I mean, rightfully, I'm not undermining that. The overall construct, which we mentioned right in the beginning, I don't know, it sounded more English to you, but we really mean every word, what we mentioned there. We are focusing on the relationship value. For instance, this processing fee is not only coming from retail operations. Retail operations, of course, have given a significant uptick in the processing fee. We have seen both in the large corporate, small corporate, MSMEs, everywhere we have readjusted our processing fee. It is not only readjusting the processing fee, not by way of increasing but reducing the concessions. We have promised them the good quality service, and we started charging processing for that process efficiency. And today, we have almost in the retail operations, we have had a growth of 50% in processing fee and the corporate book, almost 30-35%. So, I think, we are increasing our field staff to be more proactive in terms of negotiating on that.
On gold loans - precise 100% growth, critical mass of over 1 lakh crores - opportunity to increase NIMs given NBFC competitors have usurious rates. And Auto sector growth muted at 8.5%. Can we use gold loans to lift NIMs?
Your question in terms of the gold loans, the gold loan market is highly diversified. The ticket size what we look, for example, average ticket size of gold loan in our books is about 2.5 lakhs. These are price sensitive segment. They are not Rs. 20,000, Rs. 30,000 loan amount people who are willing to pay anything, any rate of interest. These are price sensitive and gold loan also you must realize there is a very efficient equity product, ROE product because there is zero risk weight on that. So, we would like to have a very strong growth but with very qualitative growth. For instance, our overall LTV is 52%. That means you have very safe lending there and yield is also not bad. I think 8.5 to 8.75 is something what we get on this. 9% is a good yield for a product which does not require any capital allocation at all and with almost zero NPA.
Sorry to harp on the NIM question again, but we exited with NIMs of 2.9%. Our road map to 3% NIM would be driven by deposits. So, for that to improve, is it going to be a yield-driven thing or a cost-of-deposits-driven thing?
No, we exited 3% domestic NIM and our guidance always has been on the domestic NIM. Yes, full year NIM. Domestic NIM is 2.93. So, as I mentioned, you have 60% of fixed deposits and fixed deposit growth is significant for us, 14%, 15% on the retail term deposit. We would like to have both levers used. One is reduce further cost of resources, it may not be very significant, but reduction of cost of resources will happen in two ways. • One is whether we can further augment our CASA in terms of absolute amount. • And number two, reduce the wholesale deposits, which are expensive. But that movement will be very limited. I do not think there will be any significant pickup on that. You are right. I think it will be more in terms of the yield and advances management, we would be looking at asset mix and also increasing spreads wherever it is feasible, both on the corporate side as well as retail sides.
What percentage of our MCLR book is yet to reprice? And on current account deposit growth, we were doing pretty well growing 20-25% until two, three quarters back, now it has come down to single digits. Anything to read into it or is it just a period end number?
MCLR book, I think the 5-basis point, which is done in December is reduced, right. That will take about 3 to 4 months, but that is not much great impact. Yes, you see, 6 months MCLR is predominant. So, we have about 40%, which is one-year MCLR. Some part of that probably is left out, otherwise mostly it is priced. No, period end number of the previous year, which has impacted. We had a period end movement in FY25, March 25. We had a significant current account movement because of the government funds release. Those things were not there. And it was a very large amount, almost 50,000 crores, which has come in the last few days of March '25. Despite that fund not being available, I think we have done phenomenally well in the current account. And as I mentioned somewhere earlier, we have had 21% decline in the government current account deposits in the last year, whereas we completely pivoted towards non-governmental current account, where we had 23% growth rate in the current account. That is, the number which you see, the yearend number for March '26, in my view is the best number ever could achieve by SBI, because we had a double impact of the last minute flows which were not available this year.
Other Opex seems to be on a higher side on a quarter-on-quarter basis. There is a lot of bunching up of other Opex which happens in the 4th quarter. This happened last year as well. Is there a way apart from any business acquisition cost to spread out the Opex one? And how do you see the cost-income ratio shaping up in FY27? Any efforts that you are taking to improve that because that is certainly on a higher side given that we have a sizable corporate book but still our cost-income ratio at about more than 50% is slightly on a higher side.
See, our effort is to keep cost-to-income ratio contained below 50. I think this is the guidance which we have given. And we would have had probably ended the year with 48-47%, but for the treasury income not supportive. Otherwise, the costs have been contained both in terms, bunching happens because of the payment cycle which comes through. It is not intentional, but I think by design much of the overheads are booked during the last quarter. So, most of the expenses and income for Q4 has to be compared with Q4 only. Any other comparison will not work. But we will definitely have a look whether any of the expenses can be spread over the 4 quarters so that we will not have that bunching issue.
On the forex open positions, which were basically asked to unwind, so that impact we have largely taken in the fourth quarter itself or that will happen in first quarter? And you have guided for a credit growth of about 13-15% for FY27. That is on a lower side versus what we had in this year. So, 13-15% chances probability of that we hitting the higher end of the guidance still is going to be strong?
Yes. I did mention I think, we said that the Q4 MTM impact what you see is about 100 crores and complete unwinding had happened on the 10th of April which resulted in a net loss of 57 crores. I think as it stands, it looks good. Except that how this West Asia conflict, how much it lingers and if we do not factor in that at this moment, I think 13-15% seems to be a feasible option. See, at the same time, as I keep mentioning, the credit growth is a function of macros. We don't want to grow significantly higher than what macros can support. So, if we have 6.5-6.9% GDP growth with 4% inflation and nominal GDP of around 10.5-11%, we built around 3% over that, 3-4% max. If any of these numbers don't realize, then we do not want to grow as much.
What is the broader outlook on the MSME space because that is the one which has been impacted the most because of the West Asia conflict? Any stress pool that we have identified, do we know that basically we are going to do lot of ECLGS but that again will be construed as that we are supporting that customer. So, any stress pool that we have identified, any incremental provisions they are going to make and that is why you are guiding for a 50 basis point credit cost in FY27?
No, 50 basis point credit cost is something what we have been guiding for the last three years. We continue to do that. It is nothing to do with the West Asian conflict but even if some movement is there, we still are sticking to that guidance. Broad-based stress is not visible yet. There are clusters which are impacted definitely. For example, Morbi cluster which is being talked about because gas is not being affordable by them, so they are not producing. Small and Medium enterprises, they are affected. We are working with them, what kind of support they need. In fact, last month we have asked them to take annual maintenance. That period is also over now. They have to come back to production, but they have not come yet. But overall credit exposure to the whole cluster is very minimal. They definitely need some support going forward. We will have to see what support we can give. Other than that, hydrocarbons, obviously the oil companies are impacted but they are all very strong balance sheets. I think there are no credit related issues with them. They may have their own P&L issues, but it will not translate to a credit issue.
How does the bank mitigate the risk in the MSME portfolio post BRE launch and on CGTMSE coverage?
I would like to just add a couple of points just around, the way we have been mitigating the risk in the MSME portfolio. We have launched BRE, I think we announced in several quarters back as well. This is giving good results. In fact, when we look at the delinquencies in the BRE versus non-BRE portfolio, in the BRE portfolio the delinquencies are lower. That means underwriting models are much more robust. Second data point is in terms of CGTMSE eligible loans, like which can be covered under CGTMSE. In the absence of that, partly it used to be collateralized. We have shifted to predominantly CGTMSE. So, coverage is almost 58% of the universe which is eligible for CGTMSE. Obviously our mitigation is much higher and recourse to the CGTMSE is much higher. I think these are helping us to get a better handle on the quality of the portfolio.
Question on your term deposit repricing. Term deposit repricing lower. Is it largely done or is there any?
Some residual tail end, that's all, but mostly done.
On your salary cost in this quarter, generally Q3 to Q4 we see an uptick, there is the PLI related payout, but this time it's not there. Is there some classification change?
Yes, there is, I think, classification change because the PLI which is to be given on the basis of the government PLI, it is still being debated. So, we have not booked in the staff expenses what you see in your presentation. It is in other provisions. So, if you add, I think it's broadly in the similar way. Accounted for.
Add-on response on transmission and emerging sector opportunities including BESS, pump storage hydro, data centres, smart metering.
Two or three things. Transmission of course, what sir has said there is a lot of potential. But I would also point out to battery energy storage systems. We have got a large number of proposals which we are processing. We also have the data centre is another activity where we have got a large number of cases we are looking at. Some we have already done. And then there are others like pump storage hydro, which is something, these are starting to come to us. Only one or two are live currently. But now a large number of people are coming because the latest tenders, for round-the-clock power. It is not the plain vanilla solar or hydro, etc. So, with that combination, either BESS or pump storage hydro, combination along with solar wind is the new flavour. So, we are seeing a lot of activity and transmission clearly is one thing which is the need of the hour because without adequate transmission, the curtailment in solar is quite high. So, I think we are supporting all of that as it goes forward. And lastly, smart metering. We have done quite a bit already but still there are a lot of opportunities there.
When you highlighted a data centre, are we funding GPUs or we will only do infrastructure?
Both. It comes as a package. So as far as the greenfield project is concerned, our ability to price is better.
SBI has YONO 2.0, multiple retail salary accounts. With touchpoints to customer concern on wallet share, how many products are we currently doing and what will we target? And how are we building up that capability to reach 5 PPC given large branch network?
Do you have any PPC number? But the last number I know is about 2.5 to 3. Around 3 products. Financial products. So, 3 is okay, but our idea is to take it to 5. And there are customers who tell me that they take about 8 to 10 different products from SBI. So that means there is a potential to go to 8 to 10. But we would be okay if we reach a PPC of 5. And the auto loans, what you asked, essentially is a hook product. You can't make money on the auto loan itself. The dealer commissions and other things. But it brings many other product engagements. Yes. So, this is something we mentioned that how do we use our manpower at the branches when a large number of transactions have moved to alternate channels. We are redeploying some of the workforce into sales, and train our workforce in the branches for upselling. So, this is something what is happening overall. And that is how you see that for a large bank, diversified customer base, we have an average of 3 is a good number.
One question around the margins again. What is so different about this quarter in terms of the margins changing direction so sharply? Whereas if you look at the last two rate cuts which happened in March and June, the impact on the P&L was not that high. Whereas this time around you seem to be attributing the entire decline to that one particular variable.
No, I am not attributing only for that. I said that the way the composition moved; it is not only EBLR. No. The overall EBLR and T-bill link pricing has to be looked at. This is what I said, the corporate book has moved to a floating rate. Whatever growth has happened in the last quarter also predominantly came from the T-bill, which gives us confidence that we can do the asset mix change going forward and we are trying to move every T-bill link loan to an MCLR based loan.
T-bill portfolio repricing dynamics, and whether the choice was taken in advance. If T-bill portfolio increased and is short-term, how long will the impact linger?
No. T-bill portfolio has increased. No, you have to compare with MCLR versus T-bill, not the T-bill versus T-bill. The one which is MCLR linked earlier has moved to T-bill and bring down the yield. Overall T-bill portfolio has had a good yield pickup. But if something is moving from MCLR to T-bill, then there is a dip in the earnings. It is not only a choice. I think it is a choice. See, it is also the composition of the users of the facilities. If you have seen, since you have asked that question, a little deep dive probably is required. Lot of large well rated corporates were accessing the market has moved to banks. And most of their facilities were linked to T-bill. They were not utilizing it all. They were not using at all. They were accessing the market, CP and all. That has moved to the bank. And this is the relationship value we have. While you all are looking at the NII part, we are looking at the overall value of the relationship with the corporate, which is not evident in the NIM. It is evident in our ROA. These are all short-term impacts only. Predominant book has been in the short term. There could be some medium-term loans also which are T-bill priced. But in the current financial year itself, we would be able to move as large chunk into MCLR based. There are two ways of handling this on the corporate side, particularly where we have very strong relationship, it is not only purely a small working capital being drawn by them. Either you increase the spread over T-bill and say that, you know, this is what the spread I am looking for. If they are getting a better price, they move on or move them to MCLR. So, these are the two strategies which we will be following this year.
On the corporate loan growth - if I look at last two quarters, we have reported almost 15% growth in the corporate loan book. While you talked about that, you are looking at things in totality in respect to ROA and ROE. But does this growth momentum will, do you think this will continue in the next coming quarters because it will continue to have a bearing on the margins also, wherein we are expecting things to move up from here.
So, the part moment also, as I mentioned, from market to bank, if the market improves, probably the reversal will happen. So, that's the reason our corporate guidance is 12 to 13% is what we are looking at. And our 13 to 15% will be primarily driven by the RAM. RAM growth.
Just one clarification on the ROA. When we talked about 1% plus ROA that we look to maintain. As we now start providing for ECL, you talked about a 3, 4 year transition journey. Will that guidance stay unchanged over those 3, 4 years or you see some impact?
We are still saying that 1% through the cycles.
Online webcast batch: Venkateshwar Rao - why Q3 profit more than Q4; Tamarish Sinha - guidance on NIM and NII for FY27; Vikas Bertiya - why Q4 NIM so much lower; Sunil Melwani - steps to increase CASA market share; Mridul (Senora AM) - MTM loss for Treasury losses; Rohan Mandora (Equirus) - cumulative domestic yield on advances down 11 basis points; Siddharth Rajpurohit - EBLR share only 35%; whether bank has made ECL provision; Siddharth - share of triple A in corporate mix risen 400 bps; Jeet (Ambit) - off-balance sheet exposure provisioning treatment.
I think there's one question why Q3 profit is more than Q4. - I think it is other way around why the Q4 is having less profit than Q3, mainly because of the MTM loss of 4520 crores in Q4 as against loss of 143 crores only in Q3. This is question from Venkateshwar Rao. And question from Tamarish Sinha from of Business. What is the guidance on Net Interest Margin and NII for FY 27? - NII guidance we do not give. But NIM, as I said, our guidance for domestic NIM is to remain above 3%. And Vikas Bertiya. Why was Q4 NIM so much lower? - I think we have had enough discussion on this. Sunil Melwani. What are the steps Bank is planning to take increase market share in CASA? - This is what I mentioned in terms of focusing on the district level improvement and the market share, as well as a very strong campaign which we launched. I have seen good impact of that campaign is, 'ABCD - All branches to contribute to deposits.' Mridul from Senora Asset Management. What was MTM loss provided for Treasury losses? Was the same passed by NII? - There is an MTM loss of 4520 crores in Q4 as against 143 crores in Q3. The MTM is routed through other income, noninterest income. Rohan Mandora from Equirus. Your cumulative domestic yield in advances for 12 months is down 11 basis point. So, what is the domestic yield for Q4 and what explains the sharp decline? - I think again this also we have explained at length, what led to this yield on decline in yield. But essentially, as I mentioned, repo rate cut of 25 basis point and also shift in corporate bank corporate credit composition. Siddharth Rajpurohit. Our EBLR share is only 35%, so there should have been only some seven-base point. - I think we need to add both the EBLR book as well as the T-bill linked advances. So that is about 50, currently we have E-bill and T-bill about 49%. Whether the bank has made any amount of provision based on ECL? - No not yet. Siddharth again, share of triple A in in corporate mix has risen by 400 basis point. Does it have an impact on yield? Guidance on the share of triple A going forward? - As I mentioned, some of the best well rated companies have moved from the market to bank. While it had dramatically altered the composition of double A and triple A, it had impact on the yields, as I mentioned earlier. Jeet from Ambit. Please clarify off balance sheet exposure like financial guarantee not required provisioning. Can we now assume that Non-funded credit exposure disclosed in Basel 3 will require provisioning in initial norms? - Provisioning a Non-Fund credit exposure shall be completed as per RBI guidelines, effective from 1/04/27. I think they also attract provision.