Ladies and gentlemen, good day and welcome to the Axis Bank conference call to discuss the bank's financial results for the quarter ended 30th September 2025. Participation in the conference call is by invitation only. Axis Bank reserves the right to block access to any person to whom an invitation has not been sent. Unauthorized dissemination of the contents or proceedings of the call is strictly prohibited, and prior explicit permission and written approval of Axis Bank is imperative. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions at the end of the briefing session. Should you need assistance during the conference call, please signal the operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded.
On behalf of Axis Bank, I once again welcome all the participants to the conference call. On the call, we have Mr. Amitabh Chaudhry, MD and CEO, and Mr. Puneet Sharma, CFO. I now hand the conference over to Mr. Amitabh Chaudhry, MD and CEO. Thank you and over to you, sir.
Thank you, Dovin. Apart from Puneet, we have on the call Subrat Mohanty, ED, Munish Sharda, ED, Neeraj Gambhir, ED designate, and other members of the leadership team. This quarter, we have delivered a strong growth in advances and deposits, gaining market share in both. We have had a steady operating performance, aided by stable net interest income, healthy fee income growth, and positive operating jaws. Notably, our credit card business crossed 15 million cards in force, and our UPI market share rose to 35%+ in terms of both value and volume, reinforcing our leadership as the top UPI payee. Our balance sheet remains resilient, and our capital position continues to be strong, enabling us to pursue profitable and sustainable growth. Let me summarize the quarter two performance.
On the deposit side, month-end balances grew 4% quarter on quarter and 11% year on year, and quarterly average balances grew 3% QOQ and 10% year on year. On the lending side, total advances grew 5% QOQ and 12% year on year. Within that, small business, SME, and mid-corporate together grew at 8% QOQ and 20% year on year and constituted 24% of total bank loans. Core operating revenue was up 4% year on year, and the core operating profit was up 3% year on year. Our fee-to-average assets continue to be best amongst peer private banks. The bank remains well-capitalized with a CET1 ratio of 14.43%. As we have stated in the past, we stay focused on three core areas of execution of our GPS strategy, namely becoming a resilient all-weather franchise, creating multiplicative forces to build competitive advantage, and building for the future.
I will now discuss each one of these areas. We have continued on our journey towards building a resilient all-weather franchise. There are four areas of focus as we navigate the current cycle: deposit growth, credit growth, retail asset quality, and costs, where we continue to work on sustainable outcomes. On credit, we delivered better growth outcome in quarter two driven by wholesale banking, where we prioritized clients and segments which would drive deeper relationship economics. With faster tabs, executional intensity, and One Axis orchestration, we continue to remain the port of call for complex mandates. On retail banking, we have started seeing gradual uptick both in the secured and unsecured segments, while maintaining focus on sourcing better quality customers. On asset quality, our corporate, SME, and retail secured book are holding up well, and the retail unsecured book is broadly seeing improvement and stabilization.
Specifically, we have seen improvement in cards and stabilization in personal loans. All the key indicators—bounce rates, early delinquency, and correction resolution rates—have shown an improvement, which provides comfort. On a half-year financial year 2026 basis, the expense increased by 3% year on year, and we continue to deliver positive operating jaws. Let me move to deposits now. The deposit journey for Axis Bank should be looked at from three aspects: quality, cost, and growth. Please refer to slide 17. We have demonstrated controlled movement in cost of funds over the last two years. Our confidence in the franchise has allowed us to take early and proactive action on saving account rates and deposits in quarter one, which has resulted in a further Q on Q decline of 24 basis points in the cost of funds in quarter two.
We continue to remain focused on growing faster than the industry in the medium to long term. In quarter two, we have gained further market share. Year on year, MEB, QAB basis, total deposits grew 11% and 10%. Term deposits grew 12% and 13%. CA grew 13% and 7%, and SA grew 6% and 4%, respectively. Q on Q on MEB and QAB basis, total deposits grew 4% and 3%. Term deposits grew 4% and 4%. CA grew - 1% and 2%, and SA grew 4% and 3%, respectively. We continue to work on improving the granularization in our deposit book. The strength of our deposit franchise continues to improve. Our acquisition engine, expansion plans, product launches, salary credits, and Burgundy AUMs remain healthy. Our new-to-bank NTB strategy is sharply focused on quality of customers over quantity, anchored through premium segment acquisition, persona-led sourcing, and productivity-led execution.
Continuing the momentum from quarter one, this approach has delivered a 44% year-on-year increase in average balances in quarter two and has grown the share of premium and family relationships in our NTB base. Our transformation projects like Fit These Push continue to play a crucial part in this change. The bank has made focused interventions to ensure better engagement with the salaried customers and continues to see healthy trends with 14% year-on-year growth in salary uploads in the NTB salary book by September 2025, 35% year-on-year growth in the number of premium accounts in the NTB salary book acquired year to date, September 2025. The premiumization of our franchise continues to progress well, led by 2% Q-on-Q and 5% year-on-year growth in Burgundy assets under management.
Recently, Burgundy Private was named Best Private Bank for High Net Worth Individuals India at the Asset AAA Private Capital Awards 2025, among several other prestigious accolades and affirmation of our commitment to excellence in client service and wealth management. While NDB growth remains vital, our biggest opportunity lies in deepening engagement with our existing to-bank customers. Through structured, data-driven, and segment-specific campaigns, we are driving higher balances, improving product penetration, and enhancing customer lifetime value. Our ETB salary book is growing at a robust 16% year-on-year, supported by a focused branch-level strategy. We have identified 400+ salary-centric branches with tailored goals, specialized training, and targeted programs across asset and cards, ensuring sharper execution. This approach is building long-term relationship equity and unlocking the full potential of our trusted customer base and franchise.
Our industry-leading new platforms, along with customized solutions across liquidity management, payments, and collections, continue to drive higher transaction banking flows with compressing tabs and deepening stickiness through ecosystem flows. Please refer to slide 31 for more details. Creating multiplicative forces to build competitive advantage, this quarter, Axis Bank continued to push boundaries, deepening its commitment to digital safety, financial inclusion, and customer-centric innovation through bold industry-first initiatives and strategic collaborations. Continuing to focus on product innovation and digital empowerment, we have launched two industry-first solutions that redefine customer safety and financial access. First, Lock FD, a pioneering feature that empowers customers to block premature withdrawals of fixed deposits via digital channels. Second, India's first gold-backed credit line on UPI, credit on UPI with gold loans for MSMEs and self-employed entrepreneurs in collaboration with Freecharge Payment Technologies Private Ltd.
Axis Bank continued to garner industry-wide recognition for its leadership, innovation, and impact. Our commitment to social responsibility was honored with the prestigious FICCI CSR Award 2023-2024, while our people practices earn top accolades, including the Business World HR Excellence Award and the Brandon Hall Excellence Award. Further, our digital-first approach was validated with the SKOCH Award 2025 for our pioneering contactless service strategy in bounce collections. Building for the future, we continue to introduce new journeys and enhancements on our digital banking side. In quarter two, we launched and scaled the Financial Health Score to all our customers. The Financial Health Score provides a view to customers on how they are doing across various parameters of financial health. Along with MyMoney, our personal finance management tool, this facility will enable customers to monitor and take actions towards leading financially healthy lives.
Additionally, we revamped the mutual fund experience for customers and introduced new features to enhance customer safety. Also, we continue to roll out and further enhance the features in the NEO platform on the corporate banking side. By the end of quarter two, we migrated approximately 95% of eligible clients to the NEO platform. Basis clients already migrated, we have seen a meaningful increase in digital activation, transactions, and other relevant metrics. Bank-wide programs to build decisions to parallel banking and Splash is progressing well. The rural advances grew 2% year on year, while deposits from parallel branches grew 10% year on year. We have expanded our multi-product distribution architecture to 2,740 branches now. During the quarter, we launched Focus Temple Management Solutions, offering enabling seamless donation collection through payment gateway, customized QRC, BBPMS, etc., which helped us win some prestigious mandates.
Building on the strong quarter one momentum, Splash 2 continues to drive our enterprise-wide transformation around customer obsession. It is changing how we listen, how we act, and how we deliver, turning insights into action and action into impact. Our retail bank MPS has improved by 55 basis points since inception, reflecting steady progress and experience quality and customer trust across key journeys. This shift is being powered by our digital enablers, Adi, our GenAI powered platform, now live on 62 customer journeys with a user base of 55,000, and Kaleidoscope, our real-time CX engine, which now maps 34 live journeys and has a user base of over 27,000. At the recent GFF 2025, Axis Bank demonstrated its commitment to driving digital innovation by actively participating in nearly 15 major product launches.
These include notable launches for UPI, like UPI Reserve Pay, UPI Help, UPI for Joint and Business Accounts, UPI Biometric Authorization, Retail FX Platform, and many others. Furthermore, we are proud to have been part of the pioneering launch of Agentic AI payments using UPI, reflecting our focus on leveraging cutting-edge technology to shape the future of banking in India. We also launched various CBDC-related initiatives. As we look back, the first half of the fiscal year unfolded amidst a dynamic macroeconomic backdrop. While tariff-related developments presented headwinds, the policy rate cuts, a favorable monsoon, GST rate reductions, and improving liquidity conditions are poised to serve as strong tailwinds as we enter the second half. These factors, combined with a series of progressive RBI policy interventions aimed at strengthening the financial ecosystem, set the stage for acceleration and credit growth.
With a resilient balance sheet, a sharp execution focus, and a clear strategic direction, we remain confident and optimistic about the opportunities that lie ahead. We will continue to invest where necessary to remain differentiated and distinctive in our journey towards building an all-weather institution. I will now request Puneet to take over.
Thank you, Amitabh. Good evening, and good evening, everyone, and thank you for joining us. The salient features of our financial performance of the bank for Q2 FY 2026 and H1 FY 2026 across operating performance, capital and liquidity position, asset clarity, restructuring, and provisioning are as follows. For H1 FY 2026, our operating performance was stable across NII, fee, and operating expense lines. Net interest income was INR 27,304 crore, grew 1% year on year. Net interest margin was at 3.77%, declined 25 basis points year on year after factoring 100 basis points pass-through of the repo rate cut. Fee at INR 11,783 crore grew 10% year on year. Operating expenses at INR 19,259 crore grew 3% year on year, delivering a positive operating jaw both on operating revenue and core operating revenue. Cost to assets at 2.38% declined 14 basis points year on year.
Core operating profit for the bank for the half year was INR 20,010 crore, grew 4% year on year. The key metrics for Q2 FY 2026 are year on year deposits and advances growth of 11% and 12%, respectively. Quarter on quarter deposits growth of 4% and advances growth of 5%. Net interest income at INR 13,745 crore year on year and quarter on quarter growth of 2% and 1%, respectively. Net interest margin for the quarter was 3.73%. Fee at INR 6,037 crore, year on year growth of 10%, quarter on quarter growth of 5%. Granular fee at 91% of total fee income. Expenses at INR 9,957 crore, a year on year growth of 5% and a quarter on quarter growth of 7%. Core operating profit at INR 9,915 crore, year on year growth of 3%.
Net credit cost at 73 basis points, down 65 basis points quarter on quarter and up 19 basis points year on year. PAT at INR 5,090 crore, our gross NPA at 1.46%, declined 11 basis points quarter on quarter and largely flat year on year. Net NPA at 44 basis points declined 11 basis points quarter on quarter. PCR at 70%, standard asset cover at 1.13%, all provisions to GNPA at 147%. Consolidated ROE at 1.3% consolidated ROA at 1.3%, consolidated ROE at 11.51%. Subsidiaries contributed 7 basis points to consolidated annualized ROA and 45 basis points to consolidated annualized ROE this quarter. The bank's CET1, including H1 profits, stands at 14.43%. We have net accreted 31 basis points of capital year on year. In the quarter, we net consumed capital for growth. There has been no material change in RWA intensity in the quarter.
The bank has provisions aggregating INR 6,243 crore, which have not been reckoned in the capital computation and translate to a cushion of 44 basis points over and above the reported capital adequacy ratio. The bank assesses its capital position on two pillars, growth and protection. We reiterate we do not need equity capital for either pillar. We may opportunistically evaluate Tier 2 and AT1 instruments based on market conditions. NIM for Q2 FY 2026 was 3.73%, down 7 basis points QOQ. Yields on interest-earning assets declined 30 basis points QOQ. This decline was offset by cost of funds reduction of 24 basis points QOQ. The bank maintains its through-cycle stance of net interest margins at 3.8%, cycle measured in terms of duration starting from the date of the last rate cut. Our progress on structural NIM drivers continues to be healthy. Improvement in balance sheet mix.
Loans and investments comprise 90% of total assets at September 25, improving 40 basis points YOY. Retail CBG advances comprise 69% of total advances at September 25, largely stable YOY. Low-yielding RIDF bonds declined by INR 5,586 crore year on year. RIDF comprised 75 basis points of total assets at September 25 compared to 1.21% at September 24. Quality of liabilities at September 25 measured by outflow rates stood at 27.2%. Moved adversely as we gained market share on deposits in Q2, we continue to remain focused on this variable. Our fee to assets improved 1 basis point QOQ. The total retail fee grew 5% QOQ, supported by our small business banking and small enterprise group fee, liability fees, and third-party product fees. Total wholesale fee grew 4%. Our WBCG fee grew 14% quarter on quarter, better than the growth in advances.
Trading profit and other income at INR 587 crore declined QOQ and YOY. Trading profit for the current quarter is largely MTM gains. Operating expenses for the quarter stood at INR 9,957 crore, growing 5% year on year and 7% sequentially. We have opened 97 new branches in the quarter and 100 new branches in the first half of FY 2026. The YOY increase in rupee crore expenses can be attributed to increase in statutory expenses offset by NIL transition services agreement expenses in the same quarter last year. Staff cost and other operating expenses are flat YOY. The statutory expenses comprise incremental PSLC purchase during the quarter, aggregating to INR 948 crore. As per the bank's policy, half the said cost has been debited in the current quarter. Technology and digital spend grew 4% year on year and constituted 10% of the total operating expenses.
QOQ expenses, excluding PSLC cost, is well contained at 2%, with staff costs showing negative growth due to gratuity expense reversal and lower headcount by 1,000 as compared to Q1 FY 2026. The rest of the QOQ expense increase is entirely attributable to the PSLC cost I discussed earlier. The net credit cost was INR 2,133 crores, declining 45% QOQ. Now moving to the core item of the P&L, which is the one-time standard asset provision. Following an RBI advisory post its FY25 annual inspection, the bank in Q2 made an additional one-time standard asset provision of INR 1,231 crores for two discontinued crop loan variants. The customer terms of underlying loans remain unchanged.
This standard asset provision will be written back to P&L when all outstanding loans in the two discontinued variants are recovered or closed in normal course or by 31st March 2028, subject to full closure of outstanding loans, whichever is earlier. No divergence in asset quality or NPA provision has been identified in the said inspection. The additional one-time standard asset provision exceeds 7.5 times FY 2025 and 13 times the three-year average P&L charge for credit cost on an aggregated basis across both products. These loans are secured. We are not expecting any significant increase in credit cost from previous years in the two discontinued product variants over the residual closure recovery period. There is no requirement or obligation to top this provision in subsequent quarters. Hence, this is a static amount that will be written back when these accounts are closed or 31st March 2028, whichever is earlier.
The impact on ROA and ROE of this additional one-time standard asset provision is 23 basis points and 196 basis points, respectively. The cumulative non-NPA provisions at 30th September 2025 is INR 13,262 crores, comprising a provision for potential expected credit loss of INR 5,012 crores, restructuring provisions of INR 228 crores, standard asset provisions at higher than regulatory rates of INR 2,227 crores, and the additional one-time standard asset provision of INR 1,231 crores, weak asset and other provisions of INR 4,564 crores. Coming to the performance of our subsidiaries, detailed performance of our subsidiaries is set out on slides 50 to 57 of our investor presentation. In H1 FY 2026, the domestic subsidiaries reported a net profit of INR 936 crores, growing 1% year on year. The return on investment on domestic subsidiaries was about 49%.
Axis Finance, overall assets under finance grew 23% year on year, of which the retail book grew 24% YOY, and the share of retail and SME stands at 55% of total book versus 53% last year. H1 FY 2026 PAT grew 18% year on year, INR 2,385 crores. Strong asset quality with a net NPA of 0.42% and negligible restructuring. Axis Asset Management Company, overall quarterly average AUM grew 12% year on year to INR 351,238 crores. H1 FY 2026 PAT stood at INR 271 crores, growing 11% year on year. Axis Securities, H1 PAT stood at INR 175 crores. Axis Capital, H1 FY 2026 PAT grew 6% year on year to INR 93 crores. Moving to asset quality provisioning and restructuring, the slippage GNPA, NNPA, and PCR ratios for the bank and segmentally for retail, CBG, and corporate is provided on slide 42 of our investor presentation.
Gross slippages in the quarter were INR 5,696 crores, declining sequentially. Our gross slippage ratio also declined by 102 basis points sequentially. Gross slippages segmentally were INR 5,222 crores in retail, INR 265 crores in CBG, and INR 309 crores in WBCG. Retail asset quality is stabilizing. Retail business net slippages and net credit costs were lower than Q2 FY 2025. Further, gross slippages in the retail assets, excluding technical impact, declined year on year, showing that portfolio slippages are stabilizing. For the quarter, 50% of the gross slippages are attributed to linked accounts of borrowers, which were standard when classified or have been upgraded in the same quarter. Net slippages for the quarter were INR 2,808 crores, declining 54% QoQ. Net slippages segmentally were INR 2,590 crores retail, INR 112 crores CBG, and INR 106 crores in WBCG. Recoveries from written-off accounts for the quarter were INR 641 crores.
With signs of the portfolio stabilizing, we increased card issuances to over 1 million cards in the quarter and grew retail disbursements 17% QoQ. Net slippages for the quarter adjusted for recoveries from written-off pool was INR 2,167 crores, declining 58% QOQ. Segmentally, retail was INR 2,095 crores, CBG INR 41 crores, and wholesale was INR 31 crores. Let's discuss technical impact. Net slippages due to technical impact was INR 280 crores, declining 85% QOQ. Provisioning on technical impact is INR 256 crores in Q2 FY 2026, declining 69% QoQ. Please see slide 44 for quantification of the technical impact across segments. We believe that the policy changes announced by RBI, when reviewed holistically, are positive for the banking system and us. We are in the process of assessing the impact or reviewing the draft guidelines. It is too early to offer an impact analysis on the changes recently announced.
To summarize, Axis Bank is progressing well to be a stronger and sustainable franchise. In the medium term, defined as a period of three to five years with FY 2026 as base year, we believe our advances can grow 300 basis points faster than industry. We continue to closely monitor the current macro and geopolitical environment, inflation, liquidity, and cost of funds as it impacts our business. Thank you for your patience. We'd be happy to take questions now.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. An operator will take your name and announce your turn in the question queue. Participants are requested to only use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Chintan from Autonomous. Please go ahead.
Hi, good evening. Thank you for taking my question. I'll use my bullets on capital and the margins rather than on the one-time RBI provision. Can I get some color from you on the credit risk draft circular? You know, how do you see that impacting banks? Any early reads? It seems like the intention there is to reduce risk rates on quite some meaningful portfolios. I saw your comment on ECL from the media briefing that you don't expect much impact. I was just wondering that given the recent loss experience, whether your PDs would be a little elevated compared to your peers, and what would that mean for you? On margins, it feels like it's fallen less than I think you feared in the previous call or what the market was expecting.
Would be curious to understand what areas you thought did better this quarter so that we can understand the moving parts. You've kindly shared some data already on yields and cost of deposits. Any more color would be helpful there. Thank you.
Thank you, Chintan, for your multiple questions. I'll attempt to answer them sequentially, but if I miss something, please come back to me. I think let's start with the credit risk rate circular. Like I indicated, the first read of the circular, and as you've correctly articulated as part of your question, is net positive for industry. We do expect it to be net positive for us, but it's too early to offer a comment as we stand today. We'd like to do a more holistic assessment and then offer a more considered response to your question. Directionally, net positive for us. I think to your question on margin performance, the core part was managing the portfolio efficiently through the quarter.
What we've been able to do well is take a hit on yield on interest-earning assets by 30 basis points, and liabilities have been repriced more efficiently, which have given us a 24 basis points uplift from the cost of funds. I think it's a mix of both asset portfolio management and a larger than anticipated cost of funds reduction that has played through in the margins. I'm sorry if I missed the.
On your EL point? On ECL point.
Yeah. On ECL, the way we are assessing it is we internally do prepare pro forma financials. We'd like to see the final circular and the contours of the final circular before we can offer a comment on what its impact would be. Basis the last pro forma assessment that we did, the only impact we're likely to see on account of ECL is the shift from provisioning from outstanding to exposure. Therefore, my comment in the press call, which says, if I reference the current expected or computed impact, the impact is likely to be negligible on our net worth. We will have an impact, but it's likely to be negligible on transition date on our net worth, basis 30th June data. We'd like to wait to see PD.
Puneet, the question was more about, you know, relative PDs and how you put capital against products like PL and CC, where you've seen a little elevated stress relative to the larger banks. Does that impact the relative economics you would face, or it doesn't work that way?
Yes, if I think if it's a principle-based question, higher the PD, higher the loss that a bank takes, the higher is going to be the stage one, stage two provision that the bank would maintain. The only caution I would provide to you at the current stage is my credit costs are not reflective of loss. I have consistently indicated that I make a 100% provision on day 90 when an unsecured retail loan turns NPA. That 100% provision is reflective in my credit cost line item. When we move to ECL, there is a continuing recovery against that item, and we'll have to build that recovery in before we conclude that current provisioning costs are short or excessive of what the ECL ask would be. Please allow us to make a more holistic assessment and come back to you.
The last assessment we've made is marginal impact on net worth on transition date.
Excellent. Thank you.
Thank you. Our next question comes from the line of Mahrukh Adajania from Nuvama. Please go ahead.
Yeah, hi. I had two questions. Firstly, on the technical slippage, your technical slippage has come down a lot to INR 280 crore. Your technical credit cost compared to the reduction in technical slippage is quite high. Now, the net slippage is INR 280 crore and the credit cost is INR 270 crore odd. I just wanted to understand that a bit better. Why is the credit cost high even though the net slippage is now really very low? My next question is on margins. There has been a sharp increase in other balances, I guess Interbank and others. That is largely better liquidity management, right, which drove the sharp increase? That is my second question.
Mahrukh, thank you for your question. I think your observation is correct. The 256 by 280 is roughly a 90%+ cover versus the 821 by 1860 was a 44% cover. There are two reasons for provisions to be in % terms higher in the current quarter than the previous quarter. One, on a single loan account or a couple of loan accounts, we've seen security erosion. On security erosion, we provide 100% provisioning. This could be timing of getting the updated security value from a system perspective or genuine security erosion. We'll work that through. Second, there is partly aging provision. As you know, we provide faster than what RBI needs us to. There would be aging provision coming through from the prior period stock. Therefore, do not look at incremental provision cover to incremental slippage.
If you combine the two, you will see relative stability in the provision cover number. To your question on balances at period end, I think we would not want to discuss transactional items from a reported balance sheet perspective. Yes, we'll do the best we can on managing our balance sheet and liquidity.
Okay. Any outlook on margins as in has the repricing been over or we'll just continue to see better deposit repricing from now on? Is the real pressure on core margins now done?
As we have consistently been saying for Axis, assuming that there is no other rate cut, and I've been saying this right from the time the rate cut started, Q3 is when we should expect a bottoming of margins. That response is subject to no further rate cuts. As you're aware, there is chatter that they may, there is chatter around the rate cut itself. As we stand, Q3 should be bottoming of margins for us.
Okay, thank you so much. Thanks a lot.
Thank you. Our next question comes from the line of Rikin Shah from IIFL Capital. Please go ahead.
Hi. Thank you for the opportunity. Just a couple of questions. The first one, I wanted to clarify, is there any one-off in the net interest income line item? That's just a clarification one. The first question is on the corporate loan growth, which is very strong. Could you share that with the incremental yields or the corresponding business? Is it lucrative enough for us that can justify such a strong growth? Secondly, I wanted a bit more color on the crop loan provisions. Why exactly was this needed? How many loan accounts are included, if you could indicate that? Lastly, just on the non-staff expenses, Puneet, you did highlight that around INR 950 crore is related to PSLC cost.
I just wanted to clarify if this INR 950 crore is the total cost which will come in 2Q and 3Q, or it was only in the 2Q and we can see similar PSLC cost in 3Q as well.
Thanks, Rikin, for your questions. Let's start with the PSLC question first. I've indicated that the cumulative PSLC cost that we've incurred in quarter two in outflow terms is INR 948 crore. Half of that cost has come in the current quarter because our amortization policy is PSLC cost over four quarters because that's the average balance that you need to maintain over the year. So INR 948 by 2, which is roughly INR 474 crore, has been charged to the current quarter. The balance INR 474 crore will be charged over the next two quarters. Roughly INR 235, 236 crore in each quarter going forward will be the residual amortization of the expense incurred in the quarter. Moving to your next question, which is what is the nature of this one-time standard asset provision?
We will not give you details around a specific number of accounts, but let me offer you a fair color so you understand this well. The bank had been offering one of the two product variants from 2015 and the other variant from 2021. These are farmer loans, and these had been classified as PSL. The bank has discontinued these two product variants, i.e., we are not doing these specific variants currently. For the loans that we had in stock, the bank has taken a position that the customer terms should not be changed to the detriment of the customer having issue. Hence, the existing stock of loans will, depending on verified end use, be classified into agri use, consumption use, or get closed when they come up for review or renewal.
The bank has been asked to maintain the standard asset provision on this stock of loans without changing the customer terms till these loans are fully recovered or repaid. We have declassified these loans from our PSL computation entirely, and we purchased the PSLCs for which the cost I have explained. The INR 1,231 crore translates to roughly a 5% cover on the total outstanding pool as of 30th September on an approximation basis. These loans are secured. We are not expecting an increase in credit cost from previous years for these two continued loan product variants. I think it's important for us to understand that this is a static provision. This provision will not be topped up or trued down in a subsequent quarter. This will remain as a static provision on my balance sheet.
On the earlier of closing all of these loans or 31st March 2028, I will get a lump sum write-back into the P&L in the quarter in which these loans are closed or 31st March 2028, whichever is earlier. It's nothing but shifting of P&L from the current quarter to the subsequent quarters, static number as we see it. I hope that gives you color and clarity on how this provision will get dealt.
Yes, very clear, Puneet. On this clarification, was there any one-off in the net interest income if you could point out? If I can just squeeze in this one more question on net technical slippages, it has come off sharply versus last quarter. Do you expect that this can potentially turn negative in the coming quarters basis the recoveries and the reduction in the gross flows as well? Those will be all my questions.
Rikin, apologies for missing your net interest margin question. No, there are no one-offs in the net interest margin for the quarter. For example, no interest on income tax refund, etc., of any shape or size worth talking about in that number. On net slippages, we do not want to give quarterly guidance on where the number would be. We had consistently said when net slippages happened that there is going to be no economic loss on this portfolio. We will recover these over time. Quarter two has borne out the fact that recoveries have started to come through. Directionally, the gross technical slippage number should decline. As recoveries continue to improve, they will have an impact on net slippages. We don't want to guide a number on this item. We'll continue to report like we have done this quarter at the end of quarter on this variable.
Got it. Very clear, Puneet. Thank you so much.
Thank you. The next question is from the line of Harsh Modi from JPMorgan. Please go ahead.
Hi. Thanks for this. I had two questions. First is if I look at risk-weighted assets as a percentage of assets, that has gone up last quarter to 75% and it stayed at 75%, which is a bit higher than the last few quarters. I'm assuming this is partly because of higher growth in SME and mid-corporate and so on and so forth. The question is, how do I see that showing up in either higher credit spreads and/or higher credit costs over the next 6 - 12 months? The second question is around the quarterly average PASA growth that has been weaker. How do we think about market share on a quarterly average basis for PASA over the next two to three quarters? Thank you.
Thank you for the question. I think on risk intensity, the risk intensity of our advances, I think you're looking at about four quarters ago to current quarter. There's been about a 5% - 6% change in the risk intensity that we report. It's partially coming from an increase in operating risk. It's also coming from the fact that we've segmentally moved. We have moved our portfolio, which was 51% retail and 49% wholesale plus SME, to roughly 60-odd % retail, 11% SME, 28%, 29% wholesale. The proportionality has marginally changed this quarter. When you transition from a wholesale plus SME mix to retail, the risk intensity moves up. Where has that paid for itself? When we started transitioning from wholesale to retail, we've structurally added about 20 basis points on asset side margins. Our margins used to be 350, 355 at the time we started this journey.
Our margins have structurally improved by 20 basis points. That confidence that the structural improvement is here to stay gives us the comfort to call out a 380 net interest margin on a two-second basis. The RWA is paying for itself. The other way to measure whether RWA intensity is paying for itself is to see if the bank is net accreting capital. Over the last year, we have net accreted CET1 capital without an external fund raise. Effectively, there is income capacity that is exceeding what is being consumed from an RWA perspective. This is good business that we are putting on from a franchise perspective. I'll hand over to Munish for the CASA question.
Hi. This is Munish. I'll take you to slide 17 in our investor deck and the template three there. If you see the growth numbers of our deposit books over the last one year, three year, five year on a CAGR basis, year on year, both on quarterly average balances as well as on a month-end balance basis, our growth has actually been beating the industry. This quarter, that number on a quarterly average balance basis was about 40 basis points. This is the RBI versus RBI number that we get on total industry-level deposits and about 1.2% on a month-end basis. If you look at the quarter-on-quarter growth on deposits, on an MVV basis, we've grown 4% this quarter, out of which 4% in term deposits and 4% in SAR.
Like we've been telling you, we've been on this journey to do two or three things in our deposit book. We are continuing to work on the granularization of our book. The second top area we are working on is the premiumization of our book. We have done some work in the NTB acquisition or engine for the bank, and we're serially seeing improvement in quality and quantity of the deposit growth there. We're seeing healthy growth there. We have done a lot of work and continue to push harder in the salaried book, and those results are showing too. We've seen 14% year-on-year growth in salary uploads and 35% year-on-year growth in the number of premium accounts in the salaried book. We've also seen an uptake in our Burgundy acquisition and the flagship Burgundy Private business in the wealth management business, etc.
The work that lies ahead of us is to ensure that we continue to build on the pillars that we have worked in the past few quarters, also to ensure that we get our entire one-axis approach embedded deeply in all of our line of businesses, including retail assets, commercial banking businesses, which includes that we bank our customers more fully across all of our deposit lines, be it mortgage or commercial banking customers, etc. That work is going on. We're also investing in technology. We talked to you about our Sparsh, which is a flagship customer experience project, as well as Siddhi, which is our tool to empower our frontline employees to engage more holistically with the customers. That leads us to our NTB book deepening, which is the existing to bank customers and deepening relationships with those customers. We're seeing progress there too.
We can't give a guidance on how this will pan out in the next couple of quarters as we don't give a guidance on that. We've been saying that, you know, on an overall basis, we have a franchise that will continue to work towards increasing the deposit growth rate vis-à-vis the industry growth rate. We're quite confident of that.
Thanks for that. If I could just understand one thing, there seems to be a significant pressure on the government-related deposit balances. While you are taking all these steps that you enumerated on the wealth management, on the salaried accounts, and all of those, would you have a sense of how many quarters more will it take for the weaker growth in some of the government-related deposit accounts to be offset by some of these newer areas? By when do you think these kind of start offsetting each other fully?
Thanks for the question. I think, as we previously indicated, the government is getting more and more efficient, both at the center and state, on how they manage their funds. We do expect the impact to continue to run as efficiency increases and better cash management solutions are provided to the bank. Like Munish indicated, we are offsetting that with other initiatives within the bank. We do not want to offer a comment or a timeframe by which the compression in government deposits would end. Efficiency is an ongoing journey. We will find other means to find growth. Thank you.
Thanks, Puneet.
Thank you. Ladies and gentlemen, in order that the management is able to address questions from all participants in the queue, we request you to please limit yourselves to two questions only. You may rejoin the queue for follow-up questions. Our next question comes from the line of M.B. Mahesh from Kotak Securities. Please go ahead.
Puneet, on this standard asset provision, if you could just kind of highlight what are the nature of observations that RBI had, and how did you come through these provisions of 5% on those loans?
Mahesh, thank you for the question. I can't discuss specific RBI observations because they are confidential in nature. To clarify your question, RBI directed the INR 1,231 crore number. It's a number that was told to us as part of the advisory following the inspection. When I take the number and divide it by the portfolio outstanding as of September, it translates to 5%. It's a way of dimensioning the number. We received an absolute number ask to provide. We have provided that absolute number ask. That absolute number will remain static. There will be no top-up or true down needed to that number in the subsequent quarters. When the underlying portfolio goes to zero, this number will get written back. Effectively, if I was to explain this, this provision could move from 5% to 100% of the book as the book runs down.
When the book goes to zero, this provision will be entirely written back into the P&L. It will be the faster of when we run down this portfolio or 31st March , 2028, which is the last date by which this will happen. Mahesh, I hope that clarifies for you.
Yes. Just to clarify, the problem that we are facing is that, is it an asset quality problem? Is it a recognition of standard asset problem? Is it an income recognition problem? Is it the way the loans are originated is a problem? We're just trying to understand the dimension of this problem, which is why this question is coming through.
Understood, Mahesh. Let me help clarify that straight up. This is not an asset quality problem. I have clarified in my note in the UFR that there is no divergence in NPA provision or asset classification as part of the said inspection. I have offered a categoric statement that this is not an asset quality problem. This is not an income recognition problem either, because if this was an income recognition problem, the reversal would have happened to the income line. We would not have provided on the provision line. To your question, where is this problem? This problem is a classification problem to which I clarified earlier that we have declassified these loans from priority sector lending, and we have bought PSLCs to offset the declassification, the cost of which you're seeing in the expense line.
The short answer to your question, this is a PSL classification question, not an income recognition or an asset classification question, which is why this amount will remain static.
Perfect. Thanks. One last question. You had mentioned that asset quality in unsecured loans is showing improvement. Directionally, should that mean that we should start seeing slippages also coming off in the subsequent quarters, assuming everything else is constant in other parts of the portfolio? Yes.
Thank you, Mahesh, for the question. I think, you know, Puneet mentioned it in his opening comments. I think we've very clearly seen stabilization and improvement across the unsecured, all three products: personal loans, credit card, and microfinance loans. Specifically, we have seen improvement in credit cards and stabilization in personal loans and microfinance. We would like to believe that this trajectory has now been happening, let's say, for the last six to seven quarters now in terms of early delinquency indicators showing an improving trend. We see no reason why this can't continue.
Perfect. Thank you.
Thank you. The next question comes from the line of Suresh Ganapathy from Macquarie Capital. Please go ahead.
Yes, yes. Thanks. Puneet, just again on this question, which, of course, Mahesh had asked, see, any declassification because priority sector assets attracted 25 basis points, if I am not wrong, standard asset provisioning and the normal assets attract 40 basis points. Obviously, certain commercial real estate goes to 100 basis points. Suddenly going up to 5%, I mean, did the RBI perceive any risk? What do you mean by discontinued crop variants here? I mean, you used to offer, you stopped offering. What you're telling the customer, terms and conditions are standard. Why go to 5%?
Suresh, thank you for the question. I think let me break responses up to your questions in parts. When we say discontinued a crop variant, we are basically saying there was a certain loan that we were offering that had a set of characteristics around what the end use of the product would be, to whom it would be given, for what tenor it would be given. We have discontinued that particular variant. We have multiple variants in personal loans. Therefore, we had multiple variants for these crop product loan products. We have discontinued the variant that was questioned. The variant, as I have previously indicated, was questioned for PSL classification. The PSL has been declassified. Like I said, the 5% is a computed number. The instruction was to make INR 1,231 crore of provision. That translates on outstanding as of 30th September to roughly 5%. At the risk of repeating myself, for abundant caution and clarity, this number will not change.
If the portfolio runs down, let's do the math. 5% of INR 24,000 crore is roughly INR 1,200 crore. If this number were to run down to INR 1,000 crore, I don't have to maintain 5% on INR 1,000 crore. I have to maintain the INR 1,231 crore as a static number. When the INR 24,000 crore goes to zero, I will get the full credit back into my P&L on that date. It is a provision that has been prescribed as a consequence of the declassification. Once the portfolio that has been declassified runs down, this provision will come back. I have also reiterated as part of this call that there is no change in the underlying customer repayment terms. Therefore, there is no reason to believe that these loans get riskier purely because of declassification. Declassification is only a benefit for the bank.
It is not a benefit for the customer.
Okay. Okay. This is very, very clear. Just to put the question in a reverse way, these INR 24,000 crores, currently, these are all well paying on time, and these are not SMA 0, SMA 1, or SMA 2 loans. There is no overdue also on these loans.
Let me give you data around these. This one-time additional standard asset provision is seven and a half times the credit cost that we incurred on these two product variants in fiscal 2025. Seven and a half times. If I take the average of the last three and a half years of loss on these loans, and I'm being specific, these two loan variant products, if I take the average of the last three and a half years, it is a 13 times cover for loss incurred.
That itself will tell you that there is a static number that we are providing for. We do not think this increases. Very simply, if the customer repayment terms are not changing, why should credit risk increase on the product.
This is very, very clear, Puneet. Thank you so much. Yeah.
Thank you. Our next question comes from the line of Aadharsh from Enam. Please go ahead.
Hi, Puneet, Amitabh. Thanks for the opportunity. The question relates to the same thing about this crop loans. The way to understand it is that, obviously, as you said, it's a PSLC classification issue. All the INR 900-odd crores cost that you mentioned on PSLC certificates relates to this, or it includes BAU as well?
Aadharsh, thank you for the question. The INR 948 crore in the current quarter is to compensate for the declassification. We bought PSLCs to compensate for the declassification.
Puneet, just to understand, let's say there's a one-time provision, which is one-time and comes back as we go along. The RBI, you know, this whole thing is our cost optimization would have been a lot better if RBI wouldn't have asked for this declassification from PSLC, right? Like our cost goes up by INR 1,000 crore, the cost is still good, but it would have been a lot better if we didn't. The recurring cost about this reclassification is actually the OpEx line and not the one-time provision, correct? Is that a fair way to look at it?
Aadharsh, absolutely a fair way to look at it. I would just supplement your hypothesis for your consideration to say, I am organically through Bharat Banking improving my PSL compliance. This will be a recurring cost, assuming that I can't make this INR 24,000 crore up through organic fresh PSL build. Yes, it may not happen overnight, but over a period of time, it will not be a recurring annual cost, one. Second, as we keep organically building PSL to substitute this INR 24,000 crore, the rupee crore value, assuming PSLC rate remains constant, should come down as we get into subsequent fiscals. The last point, since you raised the year-on-year cost comparison as a reference point for discussion, my request is, while this 474 is showing us a cost increase in the current quarter, when we get to quarter four, PSLC cost is a timing of purchase.
By the time we get to quarter four, if you realize, last year, quarter four, we had purchased PSLCs of close to INR 750 crore. That hit the same quarter. If you're looking at this impact on a year-on-year cost growth, you should keep in mind that the 750 in quarter four, on an equivalent basis for this new cost, will be about 237 because it's only one-fourth of the cost that will come to quarter four. Like I said, I think we are committed to our cost journey. It's a function of when the timing of this PSLC expenses happened. I agree with you that it is net cost negative.
Understood. The broad understanding is that this 5% provisioning, while it equates to a 5% number, it's more like the RBI is saying you've kind of had this benefit in the past, so provide it, and once it's over, you reverse it back, right? Is that the only logical interpretation to take, given that the credit cost in the past is materially lesser?
Aadharsh, I don't want to speculate on the regulator's thinking, but I've explained how this will work as clearly as possible. It would be unfair for me to decide what the regulator thought when it said make the INR 1.231 billion provisioning. We are respectful of the instruction. We've made the provision.
Perfect. One last question is, Amitabh, we did see some pickup in growth, more driven by corporates. Retail still remains low. Mortgages are zero. You indicate 3% higher than system. Does that now apply for this year, or is it still a medium-term guidance? Near-term, it still will take time to kind of get to that 3% - 4% higher in system growth.
Puneet was quite categorical that when he made his remarks that when we're talking about 300% higher growth, it applies in the medium term. This quarter, we have demonstrated slightly higher growth than the industry. Right now, we are seeing on the advances side, it's coming from wholesale. On the disbursement side, the disbursement growth is picking up across all retail asset classes. The reason why you're not seeing the OEM grow is because we did not grow earlier. You're seeing a runoff. In a way, the disbursement and the kind of runoff is canceling each other out to some extent in some asset classes. We do believe that as the retail growth picks up, you will start seeing retail growth also registering decent numbers going forward.
I'm not going to guide which quarters, but our disbursement numbers in the second quarter were, you know, the trend line was strong month on month. We are hopeful that the same trend line will continue going forward. Obviously, we have to watch the leakage too. As our risk profile improves, as we, with these new risk guardrails, we are out more in the market, as more opportunities open up, we'll be obviously fully utilizing the platform to grow the retail side. I hope it gives you a sense for what to expect.
Perfect. Thanks. Thanks both, Puneet and Amitabh. Congrats on a good quarter.
Thank you. We have our next question from the line of Subramanian from Investec. Please go ahead.
Yeah. Hi. Thanks for taking my question. Param here. I just wanted to ask on these two discontinued crop loan variants again. Is this a product that you offered as unique to you? Do other players in the market also offer these products? That's question one. You also put out something about a letter of caution from the RBI last week. Is this related to that in any way, or is that something that is completely different?
Varun, thank you for your questions. The letter of caution relates to a matter that dates back to 2010, 2011. It has culminated through the judicial process. Sorry, 2010, 2011?
Sorry, 2010-2011. It's 2010-2011, and it has culminated as a letter of caution from the Reserve Bank of India post its judicial route through the courts in India in the current quarter. It's an old item. It is not linked to the provision asked of INR 1,231 or us operating the product variants that we have spoken of. To your first question on product variants, obviously, we will not know the nitty-gritties of the exact product being offered by the market, but all benchmarking analysis that we do in the market indicates that the product variant is widely offered in the market.
Fair enough. Thanks, Puneet. If I can ask one last question, I think you mentioned that you passed on 100 basis points of rate cut. If you could just clarify why you're saying margins bottom out in Q3, yeah, that would be great.
Varun, thanks. I think I've been saying margins will bottom out for us in Q3 right from the time the rate cut started. It's not a push-out of a quarter. I think that bases our assessment of the duration of our assets and liabilities. That's how we see it play out. We'll stick to that. I think that's how our P&L, sorry, that's how our margin should play through. Q3 bottom, assuming no more rate cuts. If there is a rate cut, then there's a reset to this comment.
Fair enough. Thanks, Puneet. Yeah, that's it from me.
Thank you. The next question is from the line of Kunal Shah from Citigroup. Please go ahead.
Yeah. Hi. Coming back to the question on margin again, one is obviously there will be a CRR cut benefit which will play in. Obviously, it will get offset to an extent by the seasonal aggregate stress. When most of the banks are indicating that margins are bottoming out in Q2, is it like a lower CRR benefit and the liquidity utilization which we see? That's one of the reasons or what you indicated in terms of the duration of assets and liabilities because I don't think there would be too much of a difference in the duration of your assets and liabilities vis-à-vis the other banks. Yeah.
Kunal, thank you for the question. I do not have the granularity of balance sheet structure for the other banks, but I think we've consistently been saying the duration of our assets and liabilities are near matched in the 15, 18 months range. The duration should be measured from the last rate cut. Effectively, you should expect bottoming out in the middle of that duration. Given that the last rate cut happened for us from a transmission perspective in June, we are saying that quarter three is when we would expect a bottoming of margins. We've been consistent with what we've been saying. Let us continue to try and do what we can do best to optimize margins, but our commentary remains Q3 is bottom for us.
Okay. The CRR cut, so that benefit will continue similar to that of other banks. We will be utilizing that liquidity.
Yeah, it's a fan bank cut. That relief will come through to us also.
Okay. Got it. Okay. Yeah. Thanks. Thanks for the question. Yeah.
Thank you. Our next question comes from the line of Anand Swaminathan from Bank of America. Please go ahead.
Thank you. I have a couple of questions. First, on two metrics. One, if you look at NDRs, they are the highest since 2018, I think. Also, from a PCR, or you look at it in terms of cumulative provisions, this % of loans, it is also the lowest since 2018. How do we think about this going forward? Are these kind of steady-state numbers you're comfortable with, or would you like to manage them downwards or upwards? That's one. Number two is around any color on the Diwali-related sales post-GST pickup in retail loan demand, anything you are seeing from your personal loans or credit card business. Any color on that would be great. Thank you.
Thanks, Anand, for your question. Let me start with the PCR question. We are more focused on the rules that we write for MPA provision. PCR is only an outcome for us. For example, when I say rules, a rule that says 100% unsecured provisioning on day 90/91 is a rule that we write because that rule mitigates the underlying risk. I think you've been tracking PCRs for us over the last six to seven quarters, and you've seen the reported PCR number decline. Please appreciate that the PCR number is sensitive to write-offs. We, as a franchise, have rule-based write-offs. If you look at PCRs, including the write-off number, we benchmark this number. We've been the highest in the private sector system for the last five years. It's a 93.8%, 94% number.
One way to think about PCR comparisons is you either gross up for write-off for everybody, where you see us at the top of the coverage pie compared to the large private sector banks. Alternatively, you can bring everyone's gross MPA to a given number because write-offs will happen only on 100% provided assets and see the consequential PCR. When we look at that number also, basis the last published numbers in March, we are comfortable that we sit in a good space from a provision standpoint. Now, let me explain the technical reason for drop in PCR. Last quarter, we had this technical impact of INR 2,700 crore. This is largely a secured pool. I had indicated last quarter that 80% of these loans have 100% security value or more. Therefore, the provision cover on this is only 44% against the base of 74%, 75%.
That caused the 3% reported PCR drop. It's an outcome of what class of assets slipped and its underlying nature that has impacted PCR. I hope that clarifies the PCR and PCR performance for Axis Bank. Let's now move to LDR. On LDR, we've operated in the 92%+ - 2% band from the time LDRs came into focus. I think given the construct of our balance sheet, we are comfortable operating as we have operated over the last four to six quarters. Sorry, Anand, you had a third question, which I know I have not answered. Could you just help me recall?
No, it's okay. There's a question around kind of Diwali demand and anything you're seeing in your retail book customer base.
I'll talk for Anand. The GST cut happened or went into effect on September 22nd, 2023. In some lines of businesses, especially auto, we've seen some spurt in bookings, etc., post September 22nd after the initial few days. These are early days, and that increase must have happened because of the pent-up demand of the month of September. We're watching it closely. We think it could lead to good outcomes in general for the industry. We are obviously watching it closely. I think it's too early to just say that there is, but there is a spurt in demand on the automotive side for sure. Card spend.
I think on cards, what we noticed was almost an 18% - 20% jump over August. We saw daily spends actually growing by almost 2.5, 3X in the last week of September. The other point to also notice is that because of the GST reduction, a lot of festive sales were put on hold. Actually, the timing of the festive season, which anyway shows growth in card spend along with GST, came together. Yes, there was a pent-up consumer spending, especially in e-commerce sales, that reflected in the card spend growth in the last week of September.
Sure. Thanks a lot. Thanks for both the answers. Thank you.
Thank you. The next question is from the line of Pranav Gundlapalle from Bernstein. Please go ahead.
Hey, thanks for taking the question. Just one question. In the last 12, 18 months, we've had a couple of instances where we had these one-offs on credit cards. What do you think is driving this when you don't see something similar for peers? More importantly, with the benefit of hindsight, what could have prevented this from happening? That's one. Secondly, what gives the confidence that we will not see a repeat of these sort of instances? That's it. Thanks.
I wish I had a perfect answer for you. I think what we had last quarter was a different reason. What we have this quarter was a different reason. As we've said last quarter, that we do not, at least from an Axis Bank management perspective, we do not see any other one-time changes we intend to implement going forward. This was something which, you know, because of the discontinuance of a certain variant and asset classification issue, sorry, the classification issue on a certain loan variant, we had to make some provision, which frankly is just postponing profit from one quarter to a certain quarter, assuming the costs don't go up. Our assumption and our hope and our fervent wish is that obviously this is the end of it. We can never predict the future, but we do believe that we are a conservative organization.
We do believe that we have been conservative around how we account for things. We've been conservative around what businesses we do. Gradually, as we have cleaned up some of these things, yes, one of these items have come up. We are not aware of anything as of this point in time, though we're seeking clarifications from RBI off and on in terms of how do we account for things because we do sometimes realize that maybe our interpretation of things is slightly different from what RBI expects. As of this point in time, our hope is that this does not repeat in the future. I don't have a better answer than this. Let me assure you, we want to keep these things to zero, and hopefully, it will be zero going forward.
In terms of the focus, I think we continue to focus on the core operating performance, wherein whether it's the margin or its growth numbers, those operating performance parameters we believe continue to trend in the right direction. Like Amitabh Chaudhry said, we wish we had better answers for some of the one-offs, but hopefully, there won't be other one-offs as we look into the future. We can't predict it, but at least those that are in our control, we are trying to make sure that the metrics around those continue to be on an upward trend.
Thanks. My issue was more just to understand if this is unique or if this is something that happens with other banks, maybe better buffers or higher buffers prevent that from coming out, need to really call them out, or if this is just unfortunate and therefore really one-off that were anyway caused this kind of thing.
It would be incorrect on our part to comment. It would be incorrect on our part to say RBI in its wisdom has decided this. We obviously followed the instructions to the T. Our inspection round is over. Whatever had to be done is over. That is why we are saying that we're not aware of anything else which might come our way. I don't know what the status of the inspection with others is, if anything will pan out there or not. As he said, we believe it is one-off, and hopefully, we can keep focusing on our core operating performance and at the same time ensure that from a compliance perspective, we are in the top quartile in terms of what we do and we are seen as a gold standard on compliance. We are working towards that also.
Thank you. Thanks, Anand.
Thank you. Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Mr. Puneet Sharma for closing comments. Over to you, sir.
Thanks, Devin. At the outset, I'd like to thank Abhijit. He transitions as Head of HR to a fund management role within the bank. Head of HR, and he transitions into a fund management role within the Axis umbrella. Thank you, Abhijit, and thanks for all of the good work that you've done over the last 10 years. Happy Diwali and season's greetings to each one of you and your families. Good evening, and thank you for your time. If any questions remain unanswered, please do reach out to the IR team, which is Rahul Jain Lao, for any other further queries that you can ask. Thank you. Have a good evening.
Thank you.
Thank you. On behalf of Axis Bank, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.