The lender had earlier estimated around Rs 3,000-4,000 crore from its moratorium book to come under one-time restructuring. However, over a period of time the moratorium book itself came down drastically from 27 per cent in March to 15-16 per cent (Rs 14,000-15,000 crore) as of end August, he said.
"We had earlier expected that 15-20 per cent of the total moratorium book will go for restructuring. But now we think only Rs 1,000-1,500 crore from our total advances will come up for restructuring," Rajeev told PTI. The bank's total advances stood at Rs 1,03,408 crore as on September 30, 2020.
In August, the Reserve Bank of India had announced one-time restructuring for personal and corporate borrowers affected by COVID-19 related stress. Under the scheme, the resolution has to be invoked by December 31, 2020. So far, the lender has restructured 800 small accounts, including MSMEs, worth Rs 40 crore, under the scheme.
"There are one or two bigger accounts worth Rs 150-200 crore in the pipeline (for restructuring). These are consortium lending accounts and the decision on restructuring will be taken by respective leaders," he said. In the quarter ended September 30, 2020, the Pune-based bank reported a 13.44 per cent growth in its standalone profit after tax at Rs 130 crore as against Rs 115 crore in the same quarter of the previous fiscal.
On a consolidated basis, its net profit stood at Rs 130.44 crore in the second quarter of FY21, compared to Rs 115.15 crore last year in the same quarter. The growth in profit was on account of higher net interest income, lower bad loan provisioning and reduction in operating expenses.
"Last (Q2FY21) quarter was comparatively very good. I am sure that our numbers would be better in the next quarter as compared to the September quarter because we have already made provisioning of more than Rs 1,000 crore related to COVID or for any kind of emergency," Rajeev said.
The lender does not foresee any issue in terms of provisioning till March 31, 2021. During the first half of the current fiscal, the lender's recoveries stood at Rs 678 crore and it expects to recover another Rs 1,000 crore during the second half, Rajeev said.
In the April-September period, the bank settled worth Rs 225-250 crore of accounts under its one-time settlement schemes (OTS) and has recovered almost 60 per cent from those accounts. It expects some more recoveries from such accounts before March 31, 2021.
In the second half, it expects around Rs 250 crore to Rs 300 crore settlement under OTS. The lender's gross NPA reduced to 8.81 per cent in the September quarter from 16.86 per cent last year. Net NPA declined to 3.30 per cent as against 5.48 per cent in the same quarter of the previous fiscal.
Rajeev said he expects gross NPA to be below 8 per cent and net NPA lower than three per cent by March-end. He sees an addition of not more than Rs 500-600 crore in NPAs each in Q3 and Q4 of the current fiscal.
In the first half, the bank's deposits grew at 12.15 per cent year-on-year and advances at 13 per cent during the first half and it expects the same trend in the second half also. "We are of the view that the total deposits may grow at around 12-14 per cent and advances may grow at 14-16 per cent in the second half," he said.
Capital adequacy of the bank stood at 13.18 per cent with common equity tier 1 ratio of 10.31 per cent as on end-September. It has already received board approval for raising Rs 3,000 crore, which includes Rs 2,000 crore through equity and Rs 1,000 crore from bonds.
"We may raise funds through bonds (AT1 and tier II) during the second half in various tranches. We don't have AT1 bonds at present so we will raise Rs 400-500 crore of such bonds. We will also raise Rs 400-500 crore tier II bonds, if required. With this our capital adequacy position will be above 14 per cent for the current year," Rajeev said adding that the decision on raising equity capital will be taken in the next year.
He said the bank may not require any capital infusion from the government in this fiscal. The lender has also entered into the credit card business and has already issued close to 5,000 cards. It is looking to expand its base into the segment from the fourth quarter of the current fiscal, Rajeev added.