Ladies and gentlemen, good day and welcome to the Union Bank of India Earnings Conference Call for the period September 30, 2025. The bank is represented by the Managing Director and CEO Sir Asheesh Pandey, Executive Directors Sir Nitesh Ranjan, Sir Rama Subramanian S., Sir Sanjay Rudra, and other members of the top management. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. Now I hand over the call to Mr. Ajay Bansal, Deputy General Manager. Thank you, and over to you, sir.
Thanks madam. Good afternoon ladies and gentlemen. I, Ajay Bansal, Head of Investor Relations, welcome you all for the Union Bank of India Earnings c all for the period ended December 31, 2025. The structure of the concall shall include a brief opening statement by respected MD and CEO sir, and then the floor will be open for interaction.
Before getting into the call, I will read out a usual disclaimer statement. I would like to submit that certain statements that may be discussed during the investor interaction may be forward-looking statements based on the current expectations. These statements involve a number of risks, uncertainty, and other factors that cause the actual result to differ from the statement. Investors are therefore requested to check this information independently before making any investment or other decision. With this, I now request our respected MD and CEO sir for his opening remarks. Thank you. Over to you sir.
Thank you. Thank you so much for this. Good afternoon. To everyone, I extend a warm welcome. Sincere thanks to all of you for joining us today for this investor call and this presentation. Actually, your continued interest and trust. Engagement with Union Bank of India is truly appreciated. Before moving to we have already. Uploaded the presentation on our website and also as per the required regulation to the NSE, BSE stock exchanges.
I am very sure it is available to all of you. In brief, I would like to j ust to give you the macroeconomic environment in which the banking industry is working upon. The first is as we know there is a bit of global economic conditions, some a bit sort of uncertainty, maybe evolving trade dynamics, tariff related developments or maybe related to the oil or geopolitical situations, etc. If we see on the domestic front, the key macroeconomic indicators are well supported by the policy interventions by the Government of India as well as on the monetary policy from the regulator. I think the total outlook is very optimistic.
If we see externally, the IMF d ata, the GDP growth is projected around, say, 6.7 to 6.8% range, one of the fastest, you know, the developing economies across the world, and then driven by government capital spending on infrastructure and rural India. Similarly, our projection as far as t he bank is concerned is around 6.7%. That is actually higher than the last year our real GDP expectation of 6.5%. That is again good with this background. At the same time, I appreciate and acknowledge our customers, that is their lineage with us and the vintage which the bank enjoys with the customers across the country.
I believe that is the core v alues of the bank and the staff m embers who are there to support the sourcing, the servicing of the customers. Here I would say the bank performance, the strategic focus remains as pursuing sustainable growth and real calibrated balance between top line expansion as well as bottom line strength. While the bank is working upon the business side, the growth in the business, at the same time the bottom line is taken considered. With this, the key financial highlights in this background, I would say the net profit. The net profit for Q2 FY26 is still at INR 4,249 crore, making a QoQ increase of 3.25%. For the first half of FY26, the net profit reached INR 8,365 crore.
The op if we take is for only Q2 FY26. It is INR 6,814 crore and for the first half is totally INR 13,723 crore. The profitability ratios, ROA is comfortably at 1.16. The return on equity stood at 15.08%. The capital adequacy is one of the. Best in industry at 17.07% with CET1 ratio at 14.37%. Similarly, there is an improvement in the. Asset quality, which is an important parameter for any of the bank in the industry. The gross NPA reduced by 107 bps YoY to 3.29%. The net NPA declined by 43 bps YoY to 0.55%. The provision coverage ratio stood at 95.13%, reflecting a well-provisioned balance sheet of the bank. The credit cost and slippages again reflecting the asset quality of the bank.
The credit cost was 222 bps for Q2 FY26. Which was 109 bps in Q2 FY25. This deposit ratio was contained at 0.91%. In Q2 FY26 compared to 2.40 in Q2 FY25, that is QoQ. The gross slippages for H1 FY26 to date are INR 4,496 crore. The recoveries of H1 FY26 INR 2,000 crore and during the first of gross recovery has surpassed across steep agents by INR 1,800 crore. I think this is a very important parameter. That is the reason I have covered in my opening remarks. When NIM was maintained at 2.67%, the net interest income registered. There is a degrowth.
The non-interest income had a robust growth of 11.37% coming. To the business growth and strategic priorities, we have actually cautiously curtailed high. Cost bulk deposit mobilization. Around 21.85% YoY in September 2025. There is a reduction in that. That is actually giving a sort of a good support. We say we are cautious about the NIMs or maintaining margins. Total deposit, that is the reason. Has grew by 1.9% YoY, and advances registers the 5% almost growth, precisely 4.99% YoY basis.
While we say that we have shelled o ut the bulk deposit, yes, because of the cautious being the maintaining margins. The retail term deposits plus CASA grew by INR 1,033,000 crore. YoY basis, the retail lending growth is around 23.98%. The MSME lending growth is 14.88% for the period. The strategic mix, there are two important things. One is the retail to bulk deposit which is 75:25. We are striving for that. The RAM to corporate lending at 55% is to 45%.
In the same way when we s ay RAM 55 we tend to increase it to 58% going forward so that the portfolio is diversified and there is a better retail because when retail comes it comes along with the CASA and the other cross selling, the ancillary business, the other benefits. While you know the corporate credit.
Similarly, wherever I'm saying that it is from 45, you would like to add, is because there are certain STLs which are below, like, you know, benchmarks. Probably that actually we are shifting from lower to higher yielding while maintaining the same asset quality. With this I conclude my o pening remarks and the entire Senior Management team of the bank is with you. Post the result, you can have the question and answer session with us, please.
Thank you very much, sir. We will now begin with a question and answer session. Anyone who wishes to ask questions may press Star and 1 on the Touchstone phone. If you wish to withdraw yourself from the question queue, you may press Star and 2. Participants are requested to use only handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Jay Prakash Mundra from ICICI Securities. Please go ahead.
Yeah. Hi Asheesh sir. Good afternoon and thanks for the opportunity. First, congratulations on your new assignment here at Union Bank of India. Sir, I wanted to check if you have had time to review the bank's portfolio to provide some insights about the bank's growth trajectory. Union Bank of India has been behind the system loan growth for 12 quarters, if not more. If you can diagnose, you know.
We h ave charted a trajectory wherein we are focusing more on profitability, but sacrificing loan. Growth, maybe corporate loan growth. Where are we, I mean, and how soon can we reach system level growth? That is my question number one, sir.
Yeah, I think, you know, if. You see the team, before even you know, have taken charge, has worked well. On the entire issues, if we see that you. The growth is muted somewhere, I will agree with that on the deposit. It is very clear. In the opening remarks, that almost 21.85% of the bulk deposit we have cautiously shelled out. It was basically a trade-off.
Between the margins and the profitability and their business, the team has done well now. Coming to the going forward, let me share with you that. On the basis of CASA, the team. Which we are looking at to increase.
By 1 to 1.5 percentage points somewhere going forward, and coupled with the retained retail term deposit rather than the bulk deposit, we'd like to maintain the CD ratio between 78.5%- 80% levels.
We have analyzed the book as well.
Whenever you know we speak of the large corporate book or a mid corporate or MSME or retail agriculture, on the RAM side that is the retail agriculture MSME.
That is the reason we are saying that we would like to move.
From 55%- 58% around. Going forward, and also on the large corporate or the corporate, the private spending certainly, we are having the concrete plans with us. Fine, the past six months it was a bit sort of a muted growth. Going forward, you will see on both, we actually are cautious about the margins. We'll continue and defend and continue for that sort of a move. Also, we would like to, you know, the growth, if we say the GDP is around moving around 6.7%- 6.8%. Certainly, we would like to have around 9%- 10% of the growth on both the asset and liability side.
We have that aspiration and we'll.
Continue moving towards that as we go forward from quarter to quarter.
Sir, I wanted to check by when Union Bank of India can be similar to system loan growth. If you have had the opportunity to review the bank's portfolio and strategic priorities.
Of course, there is a trade-off.
As of now between growth and margins, if you can provide some insights as to by when Union Bank of India can be similar to system.
See, going forward you will see that.
The system level will be at par with the industry.
Now since past six months has gone.
What I am saying is on a cumulative basis.
Going forward you will see that.
We will be like.
You know the system level, which growth is there.
You will see the similar, similar in bank.
We have gone actually in the opening remarks and also when the reply to.
Your queries to a granular level that when we are seeing about the sustainable growth, from which sectors it is going to come.
That is what we have gone.
On a broader basis, what you are seeking.
Quarter to quarter we will be.
Moving with the same as in the industry, we were saying cumulative basis for March 26th.
Okay, so just to clarify sir, you are saying that right now we are at 6% loan growth. System is at 11%. By March 2026 you would be able to catch up with system, or every quarter you will be growing more or less similar with system on a QoQ basis. Hence, the conversions will happen at some point of time.
Very true.
I'm sorry, I could.
Very, very true. Very true.
As you said, we are aspiring even better than that.
Level for quarter to quarter here onwards.
Okay, understood. The March 2026, what was that number? You said by March 2026 every quarter review will be similar or higher than system and the convergence may happen as and when it comes. There is no hard and fast deadline for March 2026, or you think by March 2026 you can become like 10, 12, 11, 12% loan growth bank.
I would say, because you know if you take that.
is why I used that annual cumulative basis.
If you take, then it will require.
A much higher growth, you know.
To build that to maintain the 11%.
To 12% for the whole year.
Here onwards you will see the system level growth which is happening in the bank also.
That is, we'll be going ahead.
We are aspiring better than that, so that it is not converging as usual. We would like to expedite converges a bit earlier.
Sir, he's talking about the sequential growth QoQ, and gradually we will try to achieve the YoY also.
Right, understood.
Thank you.
Secondly, sir, on your cost of.
Deposit and yield on advances, you know, it looks like there is.
There is.
A high mismatch in the sense that your strategy says that you are cutting down bulk, but your cost of deposit is only down 5 bps, which is the lowest. It was even higher in Q1. You are saying that we are not, we are focusing on RAM, but your yield on advances has gone down 16 bps QoQ. Somehow what your strategies and the actual numbers are very different.
Yeah, actually as you said, I think you have said perfectly. When I said that strategy and if you see that INR 21.85 billion bulk deposit we have shelled off or reduced. See, it doesn't happen in the month of, say, July. It would have happened in the month.
Something more so in the month of August and September.
Impact is yes, yet to come. Generally, whenever you adopt any strategy, I think you will see at least that 21.85, the full impact you.
Will see in this quarter, point number one.
Point number two, we have taken a strategy, you know, shifting from bulk deposit to the CASA as well.
As to retail term deposits, then again.
It will continue to some quarters till it is, you know, balancing between the book. Now coming to the.
Loan book, there are two things. One is the loan book I will be seeing on the asset side, deployment side of the fund.
One is on the treasury side.
Another is only on the loan book side.
Similarly, loan book you will.
See, there are certain portions which are.
At very low yielding.
That is why you are seeing that there is a reduction in the yield of advances.
The second is if you take.
A yield on funds also, which is from the 3G side.
We have a plan to move certain portion from the.
TG to the loan book.
Certainly, the yield which is there in TG and the yield which is.
There in the advances side, has a good difference.
That is why we are very.
Much confident that our NIM will be.
Protected, and we will be trying to.
Take it forward from here, keeping in view what the scenario emerges as far as the repo is concerned.
Understood, sir. Last question, sir, is on provisioning. There is an INR 880 crore standard assets provisioning. I think in the BSE notes to account it says some INR 130 crore of prudent provisioning. If you can elaborate a bit more here. Is this ECL provisioning? Is this SMA provisioning?
What is the nature of.
This standard assets provision?
Yeah, the notes to account which I mentioned, the INR 133 crore, this is Nitesh Ranjan is to do on a six monthly basis. Because last year also if you recollect we had taken some standardized provisioning as far as the INR 800 crore that you're referring to. Yes, we have taken some standardized disclosing on two counts. One is also start moving towards reducing further the impact of ECL, and two is on some names. We felt that it is prudential to take some provisions at this stage on a conservative basis. That's the reason why you see provision for standard assets in this quarter.
Understood sir.
Thank you.
I'll come back in the future.
Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address questions from all the participants in the conference, kindly limit your questions to two per participant. Should you have a follow up question, please rejoin the queue. We'll take the next question from the line of Mahrukh Adajania from Nuvama. Please go ahead. Yeah.
Hello sir, congratulations on your appointment. I have a couple of questions. My first question is on the upgradation. There is a bulky upgrade this quarter. Is it from any lumpy account, and is there a provisioning reversal associated with it? That was my first question, sir. I have a few more questions.
Good afternoon, ma'am.
Am.
There is one account upgradation has happened that's a reasonably sizeable amount, and remaining is the overall upgradation that has happened in small ticket. Overall recovery, we are almost in.
Line with the guidance.
Okay, could you quantify the amount of the account?
It's close to INR 600 crore.
An equal amount of provisioning would have been reversed.
Yes, that's right.
Yeah.
Okay. Okay.
That is the reversal in the provisioning. Could you at all quantify how much is the recovery interest in the total interest income like you always do? Is there anything more or less compared to the previous quarter?
It's.
It's.
Similar trend is being maintained, similar trend as it was happening.
In the previous quarters?
Yeah, this is in line with previous quarters. Roughly, it's about INR 400 crore to INR 500 crore every quarter. That's the number in this quarter as well.
Got it, got it.
Makes sense. Just my last question, probably Jay also asked that. A lot of banks are seeing 20% to 30% deposit repricing benefit every quarter, but for you the deposit repricing benefit is lower in Q2 also compared to Q1. Will there be an acceleration in the second half? Is that the way your deposits are structured, or do we assume that the bulk of the repricing is already over?
Yeah, see, that is the.
I think the first, Mr. Jay Prakar, the same similar thing, you know, query on that.
The deposit which you are asking, which we have done, INR 21.85 billion, is spread over from July to September. Moreover, in August and September, it's full.
Impact is yet to come.
That's the reason you are seeing that our cost of deposit reduction is not that much, but yield on advances.
The reduction is a bit steep.
I think that was the reason. You will see more impact, and it will be more sort of wherever we will be, we will be reducing.
Reducing the CASA deposit. Sir, I said I will add to that actually if you see the.
Absolute number of number on the interest.
Deposit has come down by INR 430 crore.
There is a slight denominator effect.
Also, because we have not taken a.
Additional deposit in CASA deposit has come down.
That is why you are finding only.
3 basis point reduction in or 6 basis point reduction in cost of deposit. Actually, it is slightly more.
Got it. If at all you can quantify anything or give us any color on the transition to ECL, I know it's a draft right now, but any impact on the back or the existing book, more importantly, any rough estimate on what the run rate of credit cost will be post implementation of ECL, because that's important, right? You will have a bigger SMA book and that will have stage two that will need stage two provisions. What will be the run rate of credit cost post ECL implementation?
Yeah, ECL is not new. In fact, we have been doing ECL calculation for the last almost one and a half years. Every half year, we have been reporting.
To RBI also we have also seen.
Impact of new guidelines and it is little bit of changes are there compared to what we have been doing in terms of system capability and all other things. It is already in place. Numbers, we are aware of the numbers. Numbers are not very significant. If you look at the draft guideline, it allows us to spread this impact in next five years. We are in a position to spread the impact in much lower number of years so that we will take a call. This is a draft guideline. We have not disclosed a number as such, but numbers we have been calculating on regular basis. We have been making plans to.
Take additional provision as and when required.
Got it. In terms of run rates, to say if ECL was already on right now, would your credit cost for the quarter be substantially different?
Yeah, it is almost at similar level, not substantially different.
Thank you. Thanks a lot. Thank you.
The next question is from the line of Dixit Doshi from Whitestone Financial Advisors Private Limited.
Thank you for the opportunity. My first question was.
I'm sorry to interrupt you. Your audio is low. Sir, can you please use your handset to ask questions?
Is it better now?
It's low. Please increase the volume.
Yeah.
Is it better?
Give me a moment, please. Yes, please proceed now.
Yeah, thanks for the opportunity.
So.
If you can elaborate on the NIM. We are at 2.67% now. How do you see it from Q3 onwards with already, you know, the rate cut must have been passed on? By year end, what kind of improvement are we expecting?
See, there is a, I think, 9 basis point decrease on the sequential basis in the NIM. If you observe from March to June quarter and June to September quarter, the sequential decline is now coming down. If you recall, we had also guided that given the 100 basis point rate cut, maybe up to September quarter there will be decline in the NIM, and post that perhaps we should be.
Be able to recover.
At this stage, if you assume that there is no further rate cut, then perhaps we are close to the bottom, and maybe Q3 onwards we will be able to see the NIM kind of remaining stable to improving the impact of the CRR.
Rate cut will also start playing out because that has started towards the end of September. You see the NIM gradually increasing, kind of stabilizing in the December quarter and then improving further. This is of course subject to no further cuts from the RBI. Rate cuts on the RBI, we'll obviously have to reevaluate the numbers in case there is a rate cut.
Okay.
My second question is regarding the PSLC. I think this year we won't be having any PSLC income. Will it come back from next year onwards or will it not?
You know, this year we have.
Not done the PSLC sale, but as of now we are meeting the priority sector targets and subtargets. The objective is to build on good buffer so that maybe towards the third or fourth quarter of this year or maybe definitely the next year we should be able to have sufficient buffer in. In the private sector to kind of gain from the PSLC sales.
Okay. From next year onwards something can come, maybe not at the magnitude what we used to do.
Yes, yes. I think whatever we have done in the last financial year, at least that kind of quantum would be possible from the next year.
Okay. Okay. Okay. That's it. Thank you.
Thank you.
The next question is from the line of Ashlesh Sonje from Kotak Securities. Please go ahead.
Hi team, good afternoon. A few questions from my side. Firstly, I missed your response to the question around creation of standard asset provisions. If you can elaborate the reason for adding those provisions further in this quarter as well. Secondly, if you can elaborate on the composition of the incremental loan growth that you intend to build, whether retail, MSME, what is the expected growth in those segments, and if you can also share for us to understand the trajectory of cost of deposits better, if you can share what was the cost of term deposits this quarter and last quarter.
Yeah.
The thing is that, see normally you can understand that standard assessment provisioning we used to do, the accounts are still standard and doing very well also. However, because of certain regulatory guidelines and current measures, like last time also, we done it.
This time also, we have been doing it on a very conservative basis.
We have already done that.
This is on a continuous basis.
After watching the account performance again, we may take a call on that. Presently, we feel that it can be these accounts, we can make a standard account provisioning, which has been done on that.
The second one.
Yeah.
This will also help us in terms of building up towards ECL. That's the reasoning behind taking that provision in the current quarter.
Next question here.
On the loan growth composition that you expect going forward.
SR has in the opening remarks also told that presently because of.
The margin pressure will be more.
Towards the RAM sector which will be going, you know, it is around 57%.
We will be even crossing 58 minutes if at all.
If a corporate sector, if there is a good asset at a good pricing comes, certainly we are there to take that.
Understood, sir. Lastly, if you can share the cost of term deposits this quarter and previous quarter for us to understand the trend over there.
Definitely, I think we have to provide. We will come with it to you.
One-to-one basis.
Okay, sir. Thank you. I'll come back in the queue if I have more questions.
Yes. Yes. Yes.
Thank you.
The next question is from the line of Sushil Choksey from Indus Equity Advisors. Please go ahead, sir.
Congratulations on your appointment and good luck.
For the year to come.
Sir.
Your rich experience, be it Union Bank of India for over two decades, Bank of Maharashtra, along with your ex-colleagues and current colleagues at. How would you re-energize the bank?
From a perspective, which is the most.
Key essential part is deposit franchise.
The touch points of all the.
Unionites and the Union Bank of India future business.
Where RAM is concerned or corporate is concerned.
Yes.
I think very valid point at the.
Very valid time you have raised this.
Thank you for.
Thank you for your best wishes.
Now, there are two things which you have raised.
One is on the energizing, maybe on the staff side, soft side of the organization.
Another one which you have raised is.
On the deposit franchise which the bank typically have and with test points.
Let me share on the first.
With you because in my entire career of banking that has seen certainly these two banks. Then the others also in being in industry for so long. I always feel the unionites, which is the staff of Union Bank of India, which is around 78,000, are really one of the best in industry. The second one I have seen, why I am saying this, whether on the skill set or the patience or the resilience and come back and responsive to the.
I would say the demand of the time.
I would not say any corporate call or any specific, but the way in which for ages now you must be seeing will.
will very soon be celebrating the 107th Foundation Day. This is what my tenure is, not that long.
107.
The history says that the staff of the bank are really wonderful. That is the reason if you see in the month of October as well and even in September, I think they have done. The growth is muted only because of.
You know the cautious decision of shelving out the high cost deposit of INR 21.85 crore, percentage points.
There is certain portfolio which.
Is moved from low-yielding advances, that is, short-term loans, to slightly better ones.
I think the team which I.
Have seen from day one and my earlier also for me since you have asked that side that basically from this bank. I am back to the bank. For me it is like, you know, the homecoming. It is mica for, you know, any lady like that. I do feel that it is a strength and asset for the bank of this staff.
Coming to the deposit franchise, yes.
There are certain pockets which are actually the good yielding sort of the deposit.
Base for the bank.
That is the reason that if you see the last three to six months, though the 21.85% of the bulk deposit is reduced, the CASA as well as the retail term deposit has replaced it. It is not like any degrowth or some substantial reduction. The bank has poised. I am very sure that going forward you will see, like the first query when Mr. Mundra Jay Prakash Mundra asked on the business growth, he was very keen in detail on the first half and the second half. We all as a team have replied to it. I think both the points which you have taken are going.
To certainly yield as a system level.
Growth in this bank also. You will see because the things are very much in place and it.
Is one of the things which enables the bank. In it also you must be.
Seeing the bank is not many, you know, gained advantage when the bank is getting so many awards and acknowledgments across industry. The only thing is that we are going to capitalize it hugely on the customer service and staff ease of doing business.
Certainly, anything which culminates into business.
is all these things.
Only doubts on the rich experience led by you along with Nitesh Ranjan, Mr. Rudra, and Rama Subramanian. Cumulatively for the top management team to.
Drive the entire bank to a better wind.
Knowing the bank from listing day in the capital markets, the vibrant visibility and how viable franchise compared to peers where you go. That is the only question which I was asking on a accelerated basis. You've answered most of my question when Jay and Mahrukh have questioned you. Happy to hear all the positivities.
Let's look for betterment.
Congratulations and best wishes.
Thank you. Thank you.
Thank you.
The next question is from the line of CA Dr. Ashok Ajmera from Ajkon Global. Please go ahead.
Thanks for giving this opportunity to me and Asheesh sir. Very rich compliments and congratulations to you sir for having come back to Union Bank of India as the MD and CEO. Most of these questions have already been answered in the detailed discussion right from Jai to Sushil. I would also emphasize on that only sir, your rich experience of this bank as well as the wonders which you have done in Bank of Maharashtra. Now looking at our condition today, what we were six quarters back in this bank. We are only 3% or 4% for last six quarters growth. If you take right from Q1 of 2025 of INR 21.08 trillion business to INR 22.9 trillion, that is only 4.8% in last six quarters.
Sir, now with you having come back to Union Bank of India and now at the MD and CEO, do we expect that in your tenure of three years we will be a INR 31-32 trillion business bank, number one, which you already shared that accelerated growth. To be more specific, for reaching this kind of growth again to the system growth of 12-14%, 13-14%. We will have to look at not only retail sir, which is already 23% growing this thing. MSME is also reasonably. I think the time has come when we'll have to start with mid corporate and large corporate also to accelerate this credit. I want to hear your plans for that to overall how do we increase the and total credit growth. Because for the bank to remain in good profits. Ultimately the credit demand business of the bank so advanced.
Mr. Ajmera, please hold the line while we reconnect the management. The line has just got disconnected. Give me a moment, please.
When was it got disconnected? When I was, I completed or before?
No sir. It got disconnected just now. Please hold the line while I reconnect the management.
Thank you.
SA Sam.
Ladies and gentlemen, please hold the line. We are trying to reconnect the management team. Thank you for patiently holding. We'll reconnect the management shortly.
SA.
Ladies and gentlemen, thank you for patiently holding. I would request Mr. Ajmera to please continue.
Before the line got disconnected, how far you listened to me? I think I was on that our business and credit growth and looking at you. What do we expect now? How do we go about it?
Sir?
Yeah.
Am I audible now?
Yes sir. Yes sir.
You are audible, sir.
Okay. Thank you. Thank you so much for your compliments and wishes.
Let me tell you, coming to the bank, they are important thing, you know, when you think of.
A business at a system level.
Maybe better than system level. See, two, three things are very much required.
The one is people, another is the technology, and third is the required structures.
I am very confident and happy to share that these three things are already there.
As there was a question from Mr. Sushilji and the earlier the officials.
This structure is already in there.
The base is ready.
Now coming to the third point.
When Mr. Mundra and Madam Mahrukh, they asked about the growth.
We clearly told that the system.
Level growth and at least better than.
That we are aspiring.
Certainly, we will go by it.
We are going for that.
Now coming to the strategy.
The past experiences, as you have pointed out.
I believe that yes, the bank.
As already discussed, I think in the last 20, 25 days internally we have done the root cause, you say, or maybe a top-down approach, maybe a bottom-up.
Approach all sorts of.
Because we had a field conference also for almost two days, where in all our regional offices, zonal offices, verticals, we all have discussed just about the same.
I believe everything is in place and we are going to do it.
As you said, what would be the key differentiators? Certainly, we are working upon some of the products which can be niche for the bank.
The second one is that we are.
Poised for our foundation, which is going to be held soon, we are again thinking of launching some of the digital initiatives.
In that one will be like.
You know, related to the mobile banking for business people.
Like that, some residents of products in the related to the CASA. These are the things. Fourth is most importantly you.
Can have product, but then strategy to implement.
Internally, in the last 20 days, the thought process which has evolved is back.
To basics, and you know, the core to implementation, code to execution.
We will be having the geography level thought process strategy, and then whether it is in retail, which sector.
Which is specific area, which geography, which.
Part of a Senate people. That is almost final as you said for three years. I am not going to the figures which you have said.
Yes, we are working upon that.
A document right now. We are taking two, three months' time.
One year, three year, five year.
Along with our subsidiaries.
Joint ventures, we are building the strategy document, which will be the rolling one, which will be, like, you know, reviewed and mid course correction taken every quarter or every half year. Certainly, the bank is poised with.
A lot of positivity going forward.
I am very sure that you will see the same sort of, as you said, which was some six to eight quarters before. I think it will be in the same range and maybe better than that. This is, I think, we expect on those lines.
Thanks for such a reassuring statement.
Sir.
Sir, my second one is something, some color on the treasury because the treasuries generally are under pressure in every bank because of the rate movement. Still, in our case, the other income, our treasury profit has gone down to INR 192 crore from INR 961 crore in the last quarter. Similarly, there is a depreciation also, which has also gone up by about almost about INR 450 crore, INR 642 from INR 192 crore. Going forward, how do we see the treasury movement, like apart from the changes due to the.
Rates.
Now since the better time will be there in this second half for the treasury with further 125 basis rate cut expected, can you give some light, can you throw some light on the treasury going forward income as well as the income which comes in the other incomes.
As you have mentioned that it all depends upon the see how the.
You know what kind of regulator gives the comfort to us.
As you have.
Seen that you know last what you.
Know RBI has said in the last MPC also there is a delta which lookouts. There is always a scope that there would be a expectation.
Of rate cuts that we are also believing in that.
You know these things are there. We are, you know, the CRR cut benefit will be available in the current month and this quarter. These are the good aspects which will be improving the liquidity in the system. Also, you know, what we feel is that the public spending will also improve in the current quarter, which will also.
Improve the liquidity in the system.
Putting all this together, we feel that there would be a good market condition in the current quarter and in the coming quarter.
The interest rate is benign.
There is no issue on the interest rate. I think there would be a.
Better quarter coming in this December and March.
The profit that we have shown now may not be the profit that we have seen last.
Quarter June being there is a OMO.
Switch option work from.
We have got a very good income.
The level of profits will maintain.
From another two quarters.
Sir, there is a lot of opportunities in the IPOs and the equity also nowadays. I think you must be making some good money on that also.
We are actually putting up.
up in most of the IPOs where we feel that this company is going to do well, and we can get a good listing gain in this company. We are there.
Sir, one question on the specific question. On some data, this thing that other operating expenses in this quarter have gone up by INR 342 crore from INR 2,743 crore to INR 3,085 crore. I couldn't find time to get into details. What could be this INR 342 crore extra in the other operating expenses?
Sir.
If you just look at it on a full year basis, right, our total operating expenses last year were about INR 26,000 crore.
If you look at, you know.
Just extrapolate the six-month total operating.
Expenses.
On a full year basis, you see that the increase is only about 5.5%. It is in line with the trend.
It is just time they were you.
The expenses booked in the second half of last year were on the higher side as compared to the first half. I think we're trending in line with our plans, and therefore we are comfortable in terms of where the operating expenses are currently standing out.
Okay sir, point well taken. Can I ask something on this? Our zero SMA numbers which have gone up substantially from the last quarter, is there any specific reason or have they been regularized on time? There is not much pressure on the SMA 1 and 2 as compared to the last quarter except the SMA 0. Is there any particular region or particular account which was off for a few days?
No, these are getting regularized on a.
It's not a matter of a concern.
They.
We are very comfortable in that number.
Yes, there has been an increase.
The current quarter, it's under control.
All right, thank you very much, sir. All the best to you. We'll see the bank again reaching to the past glories.
Thank you.
Thank you.
Thank you so much.
Thank you. Ladies and gentlemen, due to time constraints, we will take one last question for today, which is from the line of Rakesh Kumar from Valentis Advisors. Please go ahead.
Hello.
Yes sir, please proceed with your question.
Thank you, sir, and congratulations on the appointment. Just one question. Related to that, there is one question. On this investment depreciation reversal that we have, has it come from the HTM book?
From a trading book.
No number is quite sizable. That is what I was.
This includes the gains that we had.
From NSDL, as you're aware, we had a holding there.
Okay.
Okay. In the HTM book, there is a drop in the duration.
So.
Have we sold anything from this apart from NSDL or?
No.
We have not sold anything from HTM.
That is mostly it is because of one stock that we have sold. Some part we have sold, so there is not much trading.
Maybe because of the redemption that might.
Have happened in between.
Okay. The duration change is quite sizable in such a large book. It was a bit puzzling. I was not able to understand.
Redemption.
Okay, and this and the SAR raise in this respected asset, is it coming from the credit risk weight or market risk weight?
It is coming from credit risk.
Okay.
In which book? In which camp.
What kind of portfolio that we have?
added which led to such a surprise as compared to credit growth number on a sequential basis?
Sir, some of the entities which are otherwise related, but for our own exposure, those are not related in rating listed, is not disclosed. At those places, we need.
To treat it as unrated and that's it.
Okay. Thank you, sir. Thank you. Thank you so much, and all the best.
Thank you, ladies and gentlemen. As that was the last question for today, I would now like to hand the conference over to the management for closing comments. Thank you, and over to you, sir.
Thank you madam and thanks to.
All the officials of the investor community, thanks for being with us and posing the queries you have.
This is as per the.
Ritual after the board, we had a press meet, and we uploaded the result, and we had an investor meet. Going forward, there will be a lot of engagement with each one of you.
We will have physical one-to-one.
Meetings as we move forward, the thing which we have assured and discussed with you today, we do.
Have certain plans here also.
We are talking to you. The entire Senior Management team of the bank is sitting.
We already had a discussion, and we are moving to our strategy document.
We'll be finalizing maybe in the next two months' time.
The implementation is already in the.
In the stages.
You will be seeing going forward, like you know, the.
The industry level sort of the growth.
Maybe a better sort of, and going forward since we are very close.
Actually, if you see, as I said, 107, 107th foundation day we will be celebrating on 11th of November. Typically, this bank has been on a conservative side, and on the expenditure side also as far as the.
You know, concerned other than business.
The second one is on the margin side.
We will continue on both sides, and going forward you will see.
A much contained the cost to income and the other parameters. The bank is certainly poised and the team is poised for a good growth. We will be requiring your help and support.
We will have more engagement with you. Thank you, all of you.
being connected to us for this investor meet and this presentation.
Thank you.
Thank you so much.
Thank you, members of the management. On behalf of Union Bank of India, that concludes this conference. We thank you for joining us. You may now disconnect your lines. Thank you.