 "Economy may rebound by Q4 of FY22: Bandhan Bank's Chandra Shekhar Ghosh")
Bandhan Bank MD & CEO Chandra Shekhar Ghosh is hopeful that the economy will rebound by the third and fourth quarters of the current fiscal, enabling the lender to meet its targets.
He said the bank had exercised caution amid the COVID-19 pandemic and made additional provisioning in the last quarter of 2020-21.
"We remain cautiously optimistic for the current fiscal as we have made additional provisioning as safeguard. The second wave of Covid pain is expected to subside in the next two-three months, and this time people are better geared than the first wave that took everyone by surprise.
"The worst seems to be over, and the economy will rebound by the time major lending business happens in Q3 and Q4, to meet our targets," Ghosh told PTI.
On NPAs, he said the numbers will come down with time as borrowers are aware about missing repayments amid the pandemic scenario.
"I recently went to an area where NPAs are high, and people acknowledged Bandhan's role in development of that locality. They are aware of the lapses in repayments due to the present situation, and have sought more time. So, there is an intent to repay; it's just a matter of time for our NPAs to come down," he said.
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Bandhan Bank had on Saturday reported an 80 per cent dip in its March quarter net profit at Rs 103 crore, as it wrote off a huge portfolio of loans worth Rs 1,929 crore in the flagship microlending business by recognising stress upfront.
As a result of the accelerated write-off, the bank's overall provisions shot up to Rs 1,594 crore in the reporting quarter from the year-ago period's Rs 827 crore. It also made an additional provision of Rs 388 crore on standard advances in the microfinance segment.
"We have almost doubled our provisions during the quarter (under review). We restructured housing loan accounts to the tune of Rs 617 crore, but none in the microfinance portfolio," Ghosh said.
Retail banking loss for the lender in the quarter to March stood at Rs 112.66 crore. However, the retail loan book grew by nearly 25 per cent on-year to Rs 79,466 crore in the 2020-21 fiscal.
Bandhan Bank's collection efficiency (including write-offs and NPAs) stood at 95 per cent as of March 2021 as against 92 per cent in December 2020.
Ghosh had Saturday said troubles in two key markets of West Bengal and Assam, arising due to factors like state elections, a local law in Assam and the second wave of the pandemic, have subsided, with both the states showing collection performance at over 90 per cent.