Sir, good evening.
Good evening, all.
Good evening to all participants. Just an update, I think MD sir has to go for our DFS call, so we will have to end the call somewhere at about 6:30. In the interest of time, we will start the call right away. Sir, what I would request is that, is the entire top management now there, sir? Can we start with the call?
Yes, it's there.
Sure.
Yes, please.
Sure. Good evening, ladies and gentlemen. I welcome you all to the Indian Bank's post-results conference call for the first quarter of FY 2027, hosted by Nuvama Wealth Management. From the top management, we have with us Shri Binod Kumar Ji, MD & CEO, Shri Ashutosh Choudhury Ji, Executive Director, Shri Shiv Bajrang Singh, Executive Director, and Ms. Mini T M, Executive Director. I request the MD sir to briefly summarize the key highlights from Q1 FY 2027 results and also provide some strategic direction on growth margins and asset quality. Post which we will have a Q&A session. Over to you, sir, and would request to keep your comments brief so that we have more time for Q&A. Over to you, sir.
Anand, first of all, I really am sorry that I will have to leave at 6:30 P.M., but it is something urgent.
No issues, sir.
I shouldn't get leave of absence, I will say.
No issues, sir.
This conference can continue. Mr. Ashutosh and madam is here, they can handle.
Sure, sir.
First of all, thank you all once again for coming in for this analyst call. By now, result has been published, and we have seen good growth in deposit also and advance also. Very balanced growth, I will say. Deposit also grew by 13.40%, advance growth by 13.90%. There is only a 40 basis point gap is there. I believe that deposit and advance growth gaps should remain range-bound. Otherwise, if this gap is very wide, then it starts impacting your overall profitability, NIM, et cetera. Very balanced growth. Highlight is CASA has grown by 15.30%, and in that, saving fund has grown by 13.54%, current account has grown by 26.33%. Advance overall and CD ratio domestic is at 13.66, and CD ratio global is at 81.06.
CASA, sequentially, it has gone up by six basis point, YoY basis around 86 basis point. Advances has grown by 13.89% to INR 6.85 crore. In that, if you see, corporate has grown by 11.49%, RAM has grown 14.80%, retail has grown by 18.74%, agriculture, single digit 9.96%. Because of the transition of the jewel loan, first two months, because of the various IT issue, various policy are to be framed. After two months, it picked up. Initial two months, there was negative growth. After that, it has picked up, and we have shown a growth of around 10%. No concern on that count also. Going forward, we will maintain the growth in agriculture also in the range of whatever we have been getting, around 15%-16% agriculture also, we will maintain that. MSME, 17% growth is there. Overall, RAM share is 60%.
Net profit sequentially has gone up by 5.48%, YoY 10.09% to INR 3,273. Operating profit sequentially 5.13%, YoY 16.51% to INR 5,557. Good growth in NII. I think YoY 17% and sequentially 4.959%. NIM, both domestic and global, has expanded by six basis point. Return on asset also, YoY basis, of course, it has come down by three basis point, sequentially, it has gone up by three basis point. Return on equity 19.48%. Cost to income ratio, it has come down from March. For whole year, last year it was 46%, for this quarter it is 44.80%. Going forward, I have given guidance of 45%, it will remain in that range. No concern on that count. PCR 98.22%. We could have maintained the last financial year, it was 98.28%.
We could have maintained, net NPA would have come further down from 0.15% to 0.14% or 0.13%. That's why we live with it. Credit cost 0.47%. In March 26, it has come down to 0.23%. There were some concern in the last analyst meet around credit cost going up, that is March phenomena. Even last time I have told that is one of March phenomena, I am again saying, March again it may go up because of the audit, et cetera, overall, remaining three quarter, it will be definitely slippage also and credit cost will be range bound only. Overall capital, my capital is 17.58%, CET1 is 16.51%. Impact of IFR INR 2,000 crore, that has gone from Tier 2 to Tier 1, impact on 44 basis point. Gross NPA has come down, YoY basis 115 basis point to 1.86%, sequentially 12 basis point.
Net NPA is flat at 0.15. Slippage ratio 0.77. Last annual it was 0.96, so it has come down also. Recovery, if you see, recovery has outpaced slippage. Recovery is 1,885, slippage is 1,250. One big account, recovery has come in that account around INR 400 crore, which we have booked in this quarter. It is contributed by that. SMA, of course, SMA overall number is flattish, but SMA 2, more than 5 crore has gone up by around INR 190 crore. Out of that one account, DCCO. That account has come to SMA 2 because of the DCCO. DCCO extension has come and accordingly repayment schedule will also be extended. As demand has been generated, once we permit extension of the DCCO, even that SMA will be within the range. Almost all guidance we have done, we are on track.
Recovery, we have given guidance of between INR 4,500-INR 5,500. Already, we have achieved almost INR 1,900. Gross NPA also, we will be achieving between 1.50%-1.60%. I think we should achieve easily. I don't see any challenge in that. CASA also, I have told 40%, I am on track of that 39.73% we have achieved this quarter and going forward. Of course, CASA still is a challenge, but I expect with the support of all the staff that we will be maintaining that. One good thing I will highlight, participation of branches has increased. Last year, during this period, only 25%-27% branches has achieved the target, but this quarter, 51% of the branches has achieved their target. That is one good sign that branches have started participating.
Broadly, all these things are straight where we can come to Q&A so that we can utilize the time.
Thank you, sir. Before we open up the Q&A, one question that I want to ask is that do you see any MSME stress? There are a few banks basically talking about that. Second, have you sanctioned any ECLGS credit? If you can just talk about what is that as a percentage in absolute amount or maybe percentage of credit.
Yeah. See, MSME stress, if you ask me, even we were expecting that there may be some stress. So far it is not visible, as if you see my SMA book, YoY basis, it has come down from 7.99% to 4.69%. Sequentially also, it has come down from 4.73% to 4.69%. As of now, we are not seeing any stress. Going forward, let us see. Some stress is there, then ECLGS will come to the rescue of such accounts. ECLGS total eligible amount is approximately INR 11,000 crore, depending on the formula given by the government. Out of that, around INR 5,000 crore has been disbursed.
Okay. Sure, sir. I'll open up the floor for Q&A. Any participant, if you want to ask a question, please use the Raise Hand Option. I think we have first question from Ajmiraji. Ajmiraji, please limit your questions and the commentary because.
My question.
we have limited time. Yeah.
No, thank you. Thank you, Anand.
Thank you, sir.
for giving me the first opportunity. Sir is also in a hurry. He has to leave. Sir, compliments to you for such a wonderful performance in the first quarter itself. In fact, very good profitability, the operating profit, net profit. I mean, you've performed on most of the parameters very well. My compliments to you for the same. Having said that, sir, since you are there now and you are going to leave, a few just thoughts and some observation from you is basically on the same which, Anand, I will extend that question only a little further. That of course, you said that that kind of stress has not been visible so far. But INR 5,000 crore has already gone as a disbursement from the ECLGS special credit, which has been started by the Government again.
Sir, even your SMA 2 numbers have also gone up little higher from INR 922 crore to INR 1,112 crores. Actually, do you see that whatever situation, even again whatever is happening in U.S., Iran and Israel, whether it is going to have some lasting impact, especially on the small industries and the businessmen here in India, and will you see some stress coming forward in that?
As I told you, SMA 2 has gone up because of one account. One account as and when we extend DCCO, I think that will go away. Not impact of that. See, actually, if you ask me, I was also expecting that there should be some impact. If you see country as a whole, we have shown very great resilience.
Yes.
I was expecting since August 2025, when first time Trump tariffs was imposed. Despite that, if you see, because of the internal good demand and good consumption our exporters have been able to diversify their export from one country to various country. We have not seen much of the impact, but still we remain watchful. That is the reason last quarter also, we have made impact of provision of INR 310 crore for West Asia crisis, which we have continued. Because of increase of exposure, INR 12 crore, INR 13 crore further we have made. We remain watchful, but so far it is not visible. If something is there, we have capacity to absorb.
The standard advance provision You are referring to that standard provision on the standard credit also has gone up from INR 490 crore to INR 733 crore.
Yeah. Impact of West Asia crisis is INR 13 crore in that one. Rest we have made prudently like ECL provision, we have also made around INR 1,000 crore.
Sir, my second.
Floating provision for ECL, we have made.
Yeah. How much is that?
Yeah, Miraji.
Yeah, on ECL total.
INR 1,000 crore we have made additional floating provision.
Floating provision. In addition to whatever earlier provisions were there.
Whatever earlier were. Yeah.
Sir, on the treasury front, I think in this quarter, there were some good benefits which are enjoyed by many of these bank treasuries. In our case, comparatively, the profit vis-a-vis the last quarter has not gone up to that extent. Anything on that we had taken some mark to market or more profit has gone into the AFS results in the treasury?
Yeah. AFS reserve, which was negative last year, it has gone.
Yeah
AFS reserve last quarter, it was negative INR 100. Now it has gone up. INR 500 it has gone up. Treasury, in fact, let me tell you, I was expecting profit of only INR 250 -INR 300, last week some yield came down, that's why this profit is there. Otherwise, in my calculation, it was only INR 250 -INR 300.
Okay. According to you, this is better what has actually come.
This is better what I have expected. Yes.
Yeah.
Ajmiraji, I think, no, we're done with two questions.
Just one. Anand, just on the credit front, going forward, in this quarter, we have moved by about 2.62% as compared to the March. Sir, going forward, because the overall we see in the kind of figures, numbers which have come, that the overall credit growth from the entire banking has gone up. People are talking about 17%-18%. Bank of Maharashtra, on the whole year, it has given again 27% growth, and this quarter also, it's around almost about 5% growth. For the whole year, the FY 2027 now, what do you think the credit growth can be in our bank, sir?
Growth is not a challenge, Ajmiraji, let me tell you. Growth can be done. Whatever you ask, if you see, if my agri grow by 16%, my RAM growth itself will be 17%-18%.
We can grow, but we should also at the same time remain mindful of the wide between credit growth and deposit growth. I am mindful of that because situation should not come when we start eating our margin. Based on that balanced growth I will approach. If I can grow deposit by 13%, I won't mind growing advance by 15%. Based on that and also not compromising on the NIM.
Okay. Thank you.
13%, 14% growth is a good growth.
I think you will achieve 16%. Anyway. Thank you very much, sir.
Thank you. Thank you, Miraji.
All the best to you.
Thank you, Anand.
Yeah. Next question we will take from Mahrukh. Mahrukh, please unmute yourself.
Hello, sir. Congratulations.
Thank you, Mahrukh.
I had a couple of questions. Firstly, do you see gold loans picking up? It's competitive. Prices have also been volatile. How much has been added to AFS reserve? The third question is on FCNR. I saw your comments on TV. You've said it before also in calls that the target is to mobilize $1 billion, but how much have you already mobilized, given that this time round the IRRs look much weaker than the 2013, 2014 IRRs?
First, AFS reserve is INR 500 this time. Last time, it was INR -211. Presently, it is INR 334 plus. Total, you can say INR 546. Coming to FCNR. FCNR, we have so far raised around $150 million as of today. Till yesterday, it was $135. We have raised around $150 million. Going forward, I have given estimate that I will be able to range between $1.5 billion to $2 billion. Challenge is not in raising FCNR. FCNR, we have lot of traction. $1 billion pipeline I already have. Challenge is in the funding. Whatever demand they are asking, they are taking demand loan or whatever. Challenge is in the funding of that loan. We are managing and quite hopeful that between $1.5 billion to $2 billion, taken together both ECB and FCNR, I will be able to raise. Hello?
Okay. Thank you, sir. On gold loans.
Yeah. Sorry, gold loan. Gold loan, like last year, I don't expect growth of 28%, 26%, because that was driven primarily not by the tonnage, by the price of the gold. I see around 15%-16% in the gold loan this year also. No concern on that. LTV also, even after the drop of 30% in the gold loan, our LTV is still at a very comfortable level. Don't see any stress in that.
Okay, sir. Thank you.
Thank you, Mahrukh.
Thank you, Mahrukh. Next question we'll take from Jayant Kharote. Jayant, please unmute yourself.
Thanks, Anand. Congrats on a good set of numbers. First question is on the margins. We saw healthy expansion QoQ. I think one of the positive surprises come from the cost of deposits. QoQ, we've seen some tightening in the first two months, yet you have seen a decline. If you could help us break down, are these gains back-ended, where you sort of rolled over some of the bulk in the last month? Of course, the reason I'm asking is, of course, because then that can sustain going into 2Q, 3Q. If you can spend some time on what has driven this cost of funds and cost of deposit gains. Second is also on the reported yield on advances have moved up, it seems, by two basis points.
Again, a small number, but anything to read, any particular products that are. What I am looking at is the sustainability through the next two, three quarters.
Yeah. Basically, if you see on deposit side, I always remain very careful of what rate we are getting. CASA, we focus on lot of CASA. Bulk also, I remain very careful. Let me tell you, borrowing, I remain normally on the borrowing side. Borrowing you get at around what rate? 155.25. Even if you have to raise bulk for 30 days, 60 days, that cost will be around at least 100, 150 basis point more than that. I remain on the borrowing side, so that also helps. Bulk also, we remain very careful. Bulk, if you see, bulk is at the same level as March. It has not gone up. INR 1.61 lakh crore was the March, INR 1.61 lakh in the June. Bulk, we have not increased. That has actually helped.
When it was picking up, like it was going 8% or CD going to 8%, bulk going to 7.7%, 7.8%, at that time, we were not in the market. That has helped, and partly it has also helped by the repricing. Maybe one and a half basis point, that has also helped by the repricing. Similarly, on the advances side. Advances also, we remain very careful of the very thinly priced loans. We remain very sensitive on that. Wherever we get opportunity, either we exit or we get better rate as compared to the last quarter. When I give any quote for the WCDL or LOC. What is full form of LOC?
Line of credit.
Line of credit. Whenever I go give any rate, I always remain mindful that my, say, cost of bulk has gone up by, say, 40 basis points, whether I'm able to pass it on or not. I remain mindful of that. LOC, line of credit, on sequential basis, I have shaded around INR 6,000 crore, where rate was very competitive. Hopefully, these trends would continue.
This means you would be probably looking to deliver at the upper end of your margin guidance for this year? If I'm not wrong, it's around 3.15%-3.25%?
Yeah. Hopefully.
Okay. Just a second question. Yeah, sorry. Go ahead.
For margin expansion, there is no trigger now. Unless there is a rate increase or some repricing. MCLR repricing and bulk deposit repricing will be compensated. MCLR also around two basis point impact will come in this quarter, negative. Similarly, bulk will be around two basis point or three basis point. It will be compensated basically. Not seeing much margin expansion from here, but very rightly you told around upper band we can expect.
Sorry, again, to double-click. How are the rollovers in retail TDs? Are you facing competitive intensity going up there? Retail term deposits.
In between it was, but not now. In between it was. When bulk was touching 7.8%, 7.9%, at that time, banks have started increasing their retail term deposit rate also. Not now.
Okay. Sorry, I missed this part of the provisioning. If you have done any accelerated provisioning for ECL this quarter on standard assets, if you can call out that number. Second, if you've now.
Yeah.
Yeah.
ECL, I have made INR 1,000 crore floating provision straightaway I have made.
In this quarter?
In this quarter, yes.
Okay. Sir, on ECL, now that you've had time to spend, how is the net? If you can tell us the gross and the net impact both on steady state RO credit cost. Now you would have had a good time to spend with the new guidelines. How does the new credit cost look?
My expectation is my impact of ECL transitioning will be around INR 3,000 crore-INR 3,500 crore. Out of that, if you remember, I have told that around between INR 1,500-INR 2,000, I will try to make provision during the year. Out of that INR 1,000, I have made. My endeavor will be to make another INR 1,000 during the year, between INR 500-INR 1,000, my endeavor will be to make that. On the transition side, there is no impact. Steady side, no impact. Flow, of course, there will be some impact on the credit cost. Credit cost, you can say, it will be, say, now standard provision is in the range of, say, for simplicity, you take around between 0.4%-0.5%. And, in ECL era, it will be around 1.5%. 1% increase will be there on the standard.
Whatever growth is coming, say I am growing by 12%, then 1% of that means 12 basis points credit cost impact will be there on the flow basis. Net of tax may be around 9 basis points to 10 basis points.
This is the net impact, right? Because you also released.
Net impact
Some release from Stage 3 provisions or NPA provisions, right?
No. See, no. Region final guidelines has come where it is required that more provision on D3 and loss asset has to be maintained at 100% flow. That means, bulk of the provision is lying in the D3 and loss asset. There will be hardly any release from there.
Okay. Basically, sir, 12 basis points pre-tax.
We have to move.
Sorry, Anand. Yeah. Thanks, sir. Thanks for that, and congrats on a good quarter.
Yeah.
Thank you.
Yeah. Jai, please unmute yourself and ask your question.
Yeah. Hi, good evening, sir, and congratulations on a steady number. Sir, I just was trying to understand. I picked up on your TV interview wherein you had said that margins now have bottomed and ideally should go up. Just now, I think you said that you are looking at similar margins. Margins will not go down, but it may not go up also. I just wanted to check, sir, what is the final verdict? How do you see it?
actually, see, Jai, when I said bottomed out, it is fact. See, now there is no trigger that it should go down, unless rate of interest is decreased.
Right.
At the same time, there is no trigger also that it should go up. Maybe marginal. There also, I have told that it may expansion maybe by not much, maybe by two basis point, three basis point.
Okay, understood.
Yeah.
Sir.
Yeah.
We had already made 10% provision on SMA one and two, right? That provision you can use for ECL transition, right? That is one of the component for ECL transition. What is the gap in understanding? I thought that that provision could also be used.
Yeah, we will be using that.
Okay. Apart from that INR 3,000 is, sir, INR 3,000-INR 4,000.
Yeah, whatever we have.
Yeah.
Yeah. Whatever we have made, apart from that impact is around INR 3,000.
Okay. Understood, sir. Sir, just lastly, have you also done IBPC in this quarter also, and the quantum?
No. Only INR 200 crore has gone. Not much.
Okay, sir. If you can quantify the total gold loan, sir. You have given the retail June loan, but the total which is including agri and SME, the absolute INR crore numbers. Thank you.
Gold loan total is INR 132,000 crore.
That is the total number, right?
Total number, yes.
Okay. Thank you, sir. All the very best.
Thank you.
Thanks, Jai. Next question we'll take from Ashlesh. Ashlesh Sonje, please unmute yourself.
Hi, sir. Good evening. Two quick questions from my side, sir. Firstly, in the market, now do you see any changes in the competitive environment, especially the pricing on home loans and corporate loans? That is one. Second one, just to clarify on the cost of funds side, is there any more repricing of term deposits that is pending?
Yeah. Pricing side, yes, there is lot of competition still. You see vehicle loan, home loan, corporate loan, particularly in good rated account and good PSUs, lot of competition is there. That remains. Cost of fund, you are asking on?
If any further repricing is pending on the.
Repricing. Yeah, repricing.
Term deposits.
Yes, of course, impact will not be much. Maybe 2 basis points, 3 basis points now, only.
Understood. Sir, just one follow-up on the previous one.
Yeah.
Any changes in the competition? Are you seeing it even marginally, let's say, intensifying or improving?
Competitiveness is, I mean, same level. Already it was cutthroat still. Only on the bulk side I am seeing that. I don't know, all of a sudden it has cooled down.
Understood.
Otherwise, housing loans is 7.15%, 7.20%. Nobody is taking lead to reduce it. Some big bank only will have to start.
Understood, sir. Perfect, sir. Thank you. Those were all the questions I had.
Thank you.
Thank you, Ashlesh. Sir, you want to continue or I think you have a call now.
Yeah, one, two question I may take.
Sure. We'll take a question from Parth now. Parth, please unmute yourself.
Yeah, thanks, Anand. Sir, I wanted to ask on the fee income in this quarter. The fee performance is very strong, and you have given some details, sir, in slide 17
Where I think the fee is being driven by miscellaneous fee income and strong loan processing charges. What is happening in miscellaneous fee income, sir, it has been strong for a couple of quarters.
Two, three income has been added. Just a minute. Syndication fee-
Just like 70.
Yes. syndication fee, INR 272 crore we have earned. We have done two syndication and also Just a minute. YoY basis we are asking, some income has come from, DEF incentive also has come. INR 30 crore DEF incentive has come, and CBDC reimbursement has come in shape of whatever cost we have incurred CBDC. Around INR 47 crore is that, INR 72 crore is syndication fee. These are the primary drivers.
This is sustainable?
Yeah. Sustainable. Underwriting we'll do, loan processing charge is sustainable. Underwriting also, as and when we get opportunity, we will do.
Is there any rate increases you have taken in your processing charges that is driving this?
No, no. Only volume increase.
Okay, sir. Perfect. Very quickly, sir, the LCR for this quarter and what is the outlook for treasury profit going into next quarter? Because, sir, the G-Sec yields have come down pretty sharply and maybe might come down further as the FCNR liquidity comes in.
LCR is 123 for this quarter, and treasury profit see 6.75. I don't see going, maybe five, six basis points that too if Bloomberg inclusion happens, maybe it may go up to 6.65. Otherwise, below that, I don't see yield pulling down. Treasury profit, I don't see much contribution from the treasury. In my calculation, I have taken treasury profit for the year around only INR 600 to INR 700.
Okay, sir. Got it. Sir,
LCR has not improved quarter-on-quarter because the new LCR calculation was supposed to help you. See, I told you, I mean, not you. We remain on the borrowing side from the TREPS and call market because we are getting cheaper. That has to be every day repriced. That is also impacting my LCR.
Okay, sir. Got it. Thank you so much.
Outflow will be every day. That is also impacting my LCR.
Thank you, Parth. Next question we will take from Kaushik from Hitao. Kaushik, please unmute yourself.
Hi, sir. I hope I am audible. Sir, I just have one.
Yeah.
I just have one question. I was seeing the data for the sectoral deployment, which you have put out in your PPT. Compared to the industry data which comes out from the RBI, there the growth towards the NBFC has been roughly around 2% on a YoY basis. The growth has been very phenomenal. Is there something which you are noticing in that particular piece, which you would like to call out? Is there any lot of competitive intensities there? That is only the question that I have to ask. Thank you.
In NBFC, we were very selective. We are participating mostly in AAA, AA only. A lot, many opportunities are coming, but we are very selective in NBFC. That is the reason, if you see, June to March, it was negative growth in NBFC, only around INR 6,000-7,000 crore. Only this quarter we have added some around INR 3,000 crore. Keeping in view that there will be some repayment during the year.
Okay. Thank you, sir.
Thank you, Kaushik.
Now please excuse me.
Yeah. Sure, sir.
I suppose we'll take further questions. I'm extremely sorry for this.
Sure, sir. Next question we'll take from Aman Singh. Please unmute yourself.
Hi, sir. Can you please help me with the all-inclusive data on SMA one and SMA two?
All-inclusive means.
All ticket size data
You want more than. All ticket size.
All ticket size data. You want both SMA 1 and SMA 2 put together?
Yes, sir. No, sir. Individually if you can give.
Okay, individually you want. SMA 1 is INR 7,000 and SMA 2 is INR 7,700. These are approximate figures.
Sure, sir. Thank you.
Thank you, Aman. Next question we will take from Sushil Choksey. Sushil, please unmute yourself.
Congratulations to Team Indian Bank for an excellent result.
Thank you.
My first question is, Ashutosh Choudhury, liquidity led by FCNRB and ECB is going to be anywhere estimated between $50 billion-$70 billion. How do you see that impacting Indian Bank? Binodji already said that we will be taking only $1.5 billion to $2 billion in your estimate, but the system would be liquid between INR 4.5 lakh crore to INR 7 lakh crore. How do you see the impact on G-Sec? He already spelled he does not see below 6.65%. On our cost of funds, maybe some diversification on lending book, maybe some cross-border transaction because M&A is also open. You will have sufficient dollars. What is your outlook from your international book led by Singapore or any other zone?
Choksey Ji, we are planning for $1.5 billion to $2 billion in FCNR, including the ECB. Roughly we will be somewhere at INR 18,000 crore liquidity that will be available to us. If you see, the cost that will not be very much lower. My cost of deposit, if I will take at 6%, 6.5%, so the costing will not reduce. This is the first point I would like to address to you. Domestic credit demand is robust, we can easily deploy this amount in our domestic credit space. With this flux of liquidity, the only thing we have to see is that government borrowing program in the days to come. How that will plan out, that will decide the 10-year G-Sec rate.
That is why we are thinking it is around 6.65%, it may come down, even if this liquidity flow will be there. This is our thought process regarding the liquidity and its impact on interest rate.
Sir, any view on your digital spend, maybe cybersecurity, new initiatives at the bank? What kind of initial or extra budget you are forming because of high profitability?
Sir, the budget is, I will tell you. The capital budget will be around INR 750 crore for looking at the AI initiatives and cyber resilience. We are taking a couple of steps strengthening our CSOC. We are planning to implement UEBA and the zero trust architecture for our cyber resilience posture, for which we have marked this. Also we are planning to go for a data lakehouse, looking at the DPDP Act, so uniformity of data, availability of data at one place. That also, program is on. It will be around INR 3,000 crore of IT budget capital as well as revenue, both together.
Sir, any view on consolidation?
Consolidation of what, sir?
Bank.
Oh. The prerogative, let it go with the Government of India. They will take a call even if they have anything in mind. I think so I'm not in a position to comment on that.
Are we happy to absorb anybody, or we would like to stay standalone?
Choksey, no comment from this side. This is a very.
Touchy subject.
Yes.
Okay. I leave it off.
Sir, I think we'll have to move to next question. We'll take a question from Jayant. Jayant, please unmute yourself.
Hello. Just clarifying the previous comment on provisioning of INR 1,000 crore this quarter. Unable to add the math, sir, can you help me? Sir said you have provided INR 1,000 crore of floating provisions in this quarter. I see, in the PPT breakup that you have given, you have given NPA provision of INR 360 and then standard of INR 700. What am I missing, sir?
Sir, missing is that the INR 737 is the net figure we have given here. Some provisions are released, some provisions are met, so that is why the net figure is INR 737 in standard advance.
Sir, you're saying INR 1,000 crore you have made floating towards ECL, and you have got a release in your standard book from some other asset, and that's why net is INR 733. Can you break down the two, sir?
Yeah, sir.
How I mean, the difference is exactly the release. Okay. Sorry, sir. Sorry for that question.
Yeah.
I get the clarity. Thank you.
Thank you, Jayant. The last question we'll take from Jai. Jai, please unmute yourself and ask your question.
Hi, sir. Thanks for the opportunity again. Sir, I missed the explanation for why the LCR is stable. I think what you mentioned that now bank is borrower in the repo market. Is that the explanation, sir?
Yes.
Sir, any bank can borrow in the repo, right? It is anyway cheaper than maybe the CD or deposit rate, right? I don't understand why, what is so different that we have done in this quarter? Repo rate is clearly cheaper than a TD or maybe bulk TD, right? Ideally, there should have been a release. If you can help a bit.
Definitely. Jai, three things is required to be keep in mind. Your credit growth amount, your deposit growth amount, and we should also think how much of my credit will be funded through borrowing. It's a combination of these three things. Suppose I am growing at INR 100 and I require INR 125, in which source I'm managing this INR 125 is more important. That is why MD sir was telling, as far as possible, we are going for borrowings. We have a borrowing limit. Based on that, we are borrowing, and thereafter, the rest is funded through deposit. That deposit composition is also one aspect. In that deposit composition, we are not much relying on bulk deposit, which is a costly affair in Q1. All these three put together has given us this result. Because of this borrowing, I'm able to maintain 123 LCR.
If I will not depend on borrowing, it will definitely go up.
Right. In a way, you have used the excess liquidity to actually increase the growth, right? In a way. Otherwise, you may have to rely more on deposits. Now you have borrowed and funded that growth.
Correct.
In a way.
Yes.
Okay. Sir, lastly, if you can help the PSL income, right? Actually, YoY it has declined. We have grown gold loan in a decent way. I thought the market for PSL is also decent. Why there is a decline YoY?
If you see Q1 also, the Q1 figure is not high last year. If you compare to Q1 2025 and Q1 2026, you will find there is an increase in my PSL income. PSL income, this is the quarter I have booked, and I have divided into four. This PSL income opportunity will also come in Q2 and Q3. Whenever it will come, and I will keep on adding, my Q2, Q3, and Q4 figure will keep on changing.
Right. Sir, looking at this.
No.
Yeah, no.
What I am saying, last year Q1 and this year Q1, you see, there is a growth.
Right.
Subsequently, whatever we have earned, that we have added in that particular quarter. In Q4, whatever we have earned, we have added in Q4 of 26. Similarly, in the Q4 of 27, we'll add whatever we'll earn during that time, during that quarter.
Okay. Sir, I am not asking Q4 versus Q1. Q1, you would have whatever you would have originated, you divided by four and you book it in Q1, right? The same has happened-
Correct
this year. This year, this first quarter.
Correct.
YOY number are comparable, right?
YOY number is only comparable. That is what I'm trying to emphasize, Jai.
Right. Okay, sir, if I look the number, that looks like that PSLC income last year, first quarter was INR 180. It has actually gone up only.
Yes.
Okay. Sorry, sir. Lastly, sir, looking at the insurance number that we have given, which band we are in, sir, now? Insurance expenses has declined by around 20%. Yeah, they have declined 19% YoY, right? We are in bracket 1, or we are bracket 2 for that-
Bracket. PSLC bracket 1, no? We are in bracket 1.
Thank you, sir, and all the very best.
Thank you. We will take that as the last question. With this, we come to the end of Indian Bank's post-results conference call. Sir, if you have any closing remarks to make, or we can end the call.
Anand, whatever the guidance we have given, we are sticking to all the guidance. The guidance in the upper quartile will fall based on the Q1 results, what we understand. That is the only closing remarks. Thank you.
Sure, sir. That's very helpful. Best wishes on behalf of Nuvama. We end the call now. Thank you, everyone.
Yeah. You do it now.
Thankful to our investors and analysts for giving their support.
Thank you very much, sir.