Karur Vysya targets 15% credit growth

Karur Vysia Bank (KVB) said it expects double-digit credit growth of 15% for fiscal 2023, building on strong second-quarter performance coupled with expected positive business sentiment.

KVB Managing Director and CEO B Ramesh Babu told analysts on an earnings conference call that the bank’s performance in terms of business growth, profitability and asset quality was on the right trajectory. .

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“We have reported loan portfolio growth of 15% for the current fiscal year and achieved year-over-year growth of 16% in the second quarter. We expect the trend to continue during the (third ) current quarter, given the busy season, fairly good monsoon and structural changes implemented over a period of time which have now started to yield favorable results,” he said KVB had announced last week a 52% increase in its net profit to ‘250 crore for the second quarter from ‘165 crore in the corresponding quarter of the previous financial year The bank posted a total income of ‘1,063 crore compared to ‘845 crore , marking an increase of 26%.

Babu said the bank’s gross slippage of 131 crores in Q2FY23 is in line with his expectations and represents less than 1% of advances. “Our recovery exceeded slippages in the quarter, showing negative slippages of 74 crores. This is the fifth consecutive quarter that the bank has been able to maintain the negative slippage trend, he said.

According to him, the recoveries show an upward trend. Due to lower technical sips and write-offs, the gross NPA has fallen to 3.97% and the bank’s plan is to reduce it to below 3% by March 2023.” Similarly, our net NPA fell to 1.36% and it is our effort to bring it back below 1% by March 2023,” he said. He said the bank’s co-lending business with two NBFC is doing well and will soon be rolling out the initiative with two other NBFCs.

“We’ve partnered with a few fintech companies for customer onboarding, we’re working with three more fintechs that will be rolling out this fiscal year,” he said.

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With the need to strengthen the bank’s civil liability activity, in particular to bring the CASA mix to 40% of total deposits, KVB created a consumer banking department. “We have opened an exclusive retail branch in Hyderabad which will primarily cater to the retail banking segment and will focus on retail loans and deposits. We plan to open 18 more branches in the current fiscal year,” he said.

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