Private sector lender Karur Vysya Bank (KVB) has said it expects to maintain the gross NPA at below 2% level in the coming quarters. Due to lower slippages, recoveries and write-offs, the bank’s gross NPA had come down to 1.73% in the second quarter of FY24 and the bank is hopeful of continuing the trend.
Ramesh Babu, MD & CEO, KVB, said at an earnings conference call that the bank’s slippages continue to be under control. Its gross slippages for the second quarter of FY24 was less than 1%.
The bank was able to sustain the growth momentum during the second quarter, as its total business grew by 4% and reached a level of Rs 1,53,516 crore. “While commercial and corporate clocked 6% quarter-on-quarter each, agriculture and retail segments have grown by 4%. Our continued focus on MSME in metro, urban and semi urban locations supported the growth under commercial segment. Corporate book, which had a muted growth last quarter, improved during this (second) quarter on account of higher disbursements,” he said.
KVB’s retail growth was similar to last quarter and the majority of the growth has come from mortgages, both residential and non-residential. The overall growth is a touch above on its annual guided growth of 14% and the bank expects that the trend will continue, according to him.
On branch expansion, he said that out of the 40 branches planned, almost 25 have been opened and another 15 branches will open soon. “We will try to open a majority of branches in this (third) quarter, leaving very few for the last quarter,” Babu said.
It is estimated that a sum of Rs 100 crore is required towards superannuation benefits, on account of wage revision in the bank. KVB had provided Rs 33 crore during the current quarter and the balance amount will be provided in the next two quarters. The bank’s staff cost would be in the range of Rs 290 crore to Rs 300 crore per quarter.
Growth Story
KVB’s gross NPA had come down to 1.73% in Q2 of FY24 and the bank is hopes to continue the trend
The bank was able to sustain the growth momentum during Q2, as its total business grew by 4%
KVB’s retail growth was similar to last quarter and the majority of the growth has come from mortgages, both residential and non-residential
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