Operator
Ladies and gentlemen, good day, and welcome to the Q2 and H1FI 27 earning conference call hosted by Tamil and Mercantile Bank Ltd. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantee of future performance and involve risk and uncertainties that are difficult to predict. As a reminder, all participant line will be in the listen only mode and there will be an opportunity for you to ask question after the presentation conclude. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. On the call today, we have the following management representatives. Thank you very
much, and thanks for attending this con call from Tamil Nadu Mercantile Bank. And I'm sure most of you would have already seen our results on the websites and on the exchanges. The quarterly performance has been as anticipated. We have been maintaining the trend of growth that we delivered last quarter. We have actually exceeded that, and this is something that we have been doing it quarter after quarter for the past seven quarters. I think this is the 8th quarter where we have exceeded our previous performance. And to delve into some of these highlights, very clearly the growth has accelerated and the profit is at record level. And when we look at the business growth itself, the total business growth is 27.25% year-on-year, which is almost three times our own 10-year carrier of 9.41%. So, this carrier is also moving up on the basis of the rising growth, and this growth is highest year-on-year growth in the last 18 years. So, that's something that we are fairly proud of, and it's also 8% faster than the industry. So the delta today, in terms of growth, is 8% over the industry's growth that EMB has delivered. And this growth has driven a strong net profit, the highest ever, 451 core, highest ever net profit, and that net profit has come out of the core business growth. These are not on account of exceptions. These are largely driven by the core business, the core bias, very strong net interest income. Apart from that, let me also say that the strength that we are adding to the balance sheet in terms
of them we have taken is looking forward into the ECL norms that will come on the 1st of April 2000. 527, we have in anticipation provided fully SMA 1 and SMA 2, something that we have done this quarter. If you recall, the current year, the 527, we had also provided fully for this trust 1 and SMA 2. We have fully provided as per ECL norms. The NPA, the gross and net continues to decline. The net NPA is at 0.14%. The capital equity is at 32.39%. The balance sheet has also moved up quite sharply
And this has resulted in the earning per share is at 28.49 rupees. The shareholders' funds is today 12.53 of the balance sheet. Just to give you a little more color on the numbers itself, the total business stands at
Operator
1,30,237 crores, which is up 27.25%. We are looking at 25.49%, as it stands today,
which stands at 69,546 crores, 2%, 691 crores. CASA grew about 16.26, 6.96, and on the earnings side, as I said, that the profit has been delivered on a strong net interest income. The net interest income for the quarter stands at 807 crores, up 35.17 crores. Operating profit is 642 crores. Operating profit after expenses, 642 crores, up 41.80%. As I said earlier, the net profit is required
as the highest ever this bank has clocked
at 451 crores, up 42.09% year on year. It stands at 2.18%. ROE, unsecured exposure is a bare 20 basis, 4.33%. The net interest margin is year on year up 36 basis, 4.19%. Sequentially, it stands at, we have lost 10 basis, it was 4.29%. And I did explain why it was 4.29% last quarter in the last phone call. Profit per employee stands at almost 35 lakhs, and that is up 36.45%. Gross NPA, 0.61%, and net NPA is 0.14%. The credit cost is at 9 basis points, 0.09%, and the slippage is again 6 basis points. The PCR, on-book PCR is 77.49 and the overall PCR is at 96.61%.
zero included, SMA012 is at 1.67%, which is
Operator
that if you look at your NG of 0.61% and
SMA of 1.67%, your portfolio is at risk one day. Today, on 30th of September, was at 2.28 percent. As I said earlier, the stress NFP, we have provided 100 percent, and SMA 1 and 2, we have also provided 100 percent as per the ECL norms. So, just to run through some of the numbers, CASA at 16.26% is the growth.
Term deposit, the total term deposit growth of 25.49%
has been driven by the term deposit, which stands at almost 29%. I think the non-callable deposits, share in the incremental term deposit, incremental term deposit for the half year stands at 7570 crores, 40.62% of that came in the form of non-callable deposit. As you are aware, non-callable deposits are before the maturity. So there is no repayment of that.
Operator
So, from that perspective, this deposit makes
our resource security that much more stronger. S&RB, we did about $51.94 million, not something that we can write home about. So, overall, the S&RB deposit base, deposit growth has been 47.14%. So, S&RB is not one of the better stories that we want to put on the table. It's just about $51.94 million. And the advances, 29.32% riding on the RAM. If you look at the MSME, as I promised, has INSTOP, and today stands at 23.62%. We also have the, I think there's a lot of talk going on on the gold loan portfolio. The gold loan portfolio, we have put out our sensitivity on it at 20%, or 3.13% of our gold loan will be above the market. It is just 3.13%. The portfolio LTV stands at 62.35%. The overall portfolio is at about 48%, almost stable. It was about 47 something earlier, it's about 48 now. Now, unsecured exposure remains minimal at 20 basis points.
Getting to some of the ratios, I'll just take you through some of the ratios.
First slippage, I just mentioned six basis ratios. Let me also give you some call around the expected credit loss. We have done a calculation of the impact as on 30th of September 26th. That comes to about 384 crores. The due norms of expected credit loss would be 385 crores. And I think if you check into the slide 29, we have given a color of how we intend to tackle it. We are already in the last quarter, and the existing contingency provision together today covers almost 80% of that at 3.24 crores. The ratios, cost of deposits has moved up.
You can see the CAFA has moved up only 16.26%,
where our term deposits actually grew close to 29%. So, it is having an impact on the cost of deposits at 5.85%.
This was anticipated, and we have tweaked our advances portfolio.
For this increase, 5.93, we have picked up almost 1,000 crores of refinances in the quarter at 7.5%. It's also pushing up the cost of funds. And consequently, the NIM sequentially has come down about 10 basis. But it's still on a year-on-year basis, it's still significantly horrific basis up. And credit cost, like I said, is just 9 basis point. Our calculations show that the expected credit loss for the bank is 385 crores. And like I said, in the last quarter, we did provide only 100% for the non-fund facilities which are under stress. This quarter, we have provided 100% for SMA 1 and 2 as per ECL norms. So, the total upfront provision that we have done for the ECL is 54.24 crores, and along with the existing contingency provision available of 250 crores, we have a provision available of 300.24 crores against the 385 crores that is required to cover the expected credit. That's almost a provision of almost 80%. I was also telling you about the cost of deposit. It has moved up 5.68% to 5.85%. That is anticipated. When you look at your term deposit moving up almost 79%, and the costs are moving up at a slower pace, 16.26%.
Operator
The cost of deposit was anticipated to go up.
We did, like I said, anticipate and we tweaked our advance portfolio to portfolio, where it has moved up from 10.10% to 10.32%. Cost of funds at 5.93%, we did pick up some refinance in the quarter from Sydney at about 7.5%, slightly pushed it up. It's up to 36 basis from on a year-on-year basis, but frequently, as the temp deposit portfolio is improving, it has actually gone down about 10 basis points. Capital request is at 32.39 basis, and cost-to-income ratio, like I said, has consistently been, you know, moving down, trending down at stats at 38.28%, PCR at 77.49%, that is the on-book PCR. I can also tell you that our leverage and NSFR, LCR, etc., on a good footing, our leverage ratio against what is required to be done at 3.50%, our leverage ratio stands at 11.99%. NSFR is at 146.15%. Given you some color on where, how the CD ratio can move forward, to what extent we have cushion left, and that's also there in the presentation, if you refer, rate number 33, the CD ratio that is possible for us, given the fact that our network today has 12.53% contribution to the balance sheet, and that's just, which is better than profit per employee, 35% to 35 crores, business per employee stands at, sorry, profit per employee, It goes up to 35 lakhs in the half-year, and we are committed to open 60, and the process is on for the other branches to be opened. Year on year, we did open about 37 branches, and 15 of these branches were opened outside the state of Tamil Nadu. And when we enter here, 60 branches, we hope to open 20 plus branches outside the state of Tamil Nadu. So, I think we have also given you some kind of the kind of structural changes we are making in the presentation. I think you can go through that, and there are questions we are here to answer that. So, over to you guys. Thank you.
Operator
Thank you. Team, shall we begin with the question and answer session?
Operator
Thank you so much. Ladies and gentlemen, we'll now begin with a question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. First question comes from the line of Darshan Deora with Invest Group. Please quit.
Yeah. Thank you for the opportunity to ask this question. Personally, congratulations to the IMB team on a great turn of results. Every quarter, you guys have been hitting out of the park, and congratulations for another quarter where you have been around the park. So my first question was on the split of the gold loans. Can you give the breakup between Agri and Retail?
Agri and Retail, the total number is 29 to 80. Agree is 22,700, you
said, right? Agree, yeah.
And the other one, the retail is 6,084.
The second question was, what percentage of a loan book would be linked to the repo rate, And when do we do the reset? Suppose the interest rates get increased, is it immediate or is there a lag of the water? It is not immediate.
52% of our advances portfolio is repo linked. And the repo, the pricing gets changed at the reset date.
Okay. But you said 52% or 62%? Okay, but just to give the break up, you said 52% is repo. What would be fixed rate? What would be the MCLR?
Yeah, fixed rate would be about 4.85%.
And your MCLR would be the balance.
Just one second, I'll give you.
Making up with the special link.
This, so you said the reset is not immediate. It happens whenever the, you know, reset date, and that can range from, like, is it like usually on a six-monthly basis or quarterly basis, annual basis, typically?
Quarterly basis. Got it. Got it.
And one last question. In terms of an unsecured portfolio, what type of loan is it? Is it like a credit card type loan or is it an unsecured personal loan?
No, no, no. It is neither credit card nor...
We have given a loan to Kerala State Electricity Board.
But it's an unsecured loan. Okay. Yes, it's against the cash flows. Got it. Got it. Thank you. That's also my sign and congratulations on a great set of numbers. Thank you.
Operator
The question comes from the line of Varun Dubey with Share India Securities. Please go ahead.
Good evening, sir, and once again, congratulations on strong set of numbers from your side. I mean, quarter on quarter, the company has been performing very well. But I remember, sir, last quarter when the good performance continued, your company has actually gone ahead and gave us guidance. So this time, should we, you know, expect a better guidance from your side because you have not said anything on the effect management guidance. So what could be the advanced growth, the overall business growth and the deposit growth guidance for FY27, would you like to avoid it for us?
Varun, okay. So what do you want us to do? I think we can, from whatever we said the last time, maybe just to keep you happy, we can increase the guidance by 1%. Let me tell you, in the second half, we are hoping to see the CASA growth continuing at the existing level, perhaps a tad a bit higher. So, we are looking at anticipating a 17% kind of growth. But the deposit, we did give a guidance of 18% plus, right?
Operator
If you remember, if you recall last time, we didn't give it 18% plus guidance.
And I think that, I think, now we are simply, we can say it will be 20% plus. The plus, how much of that would be the plus, how much that amounts show is something that we will see. But it will be 20% plus. And similarly, in the advanced growth, we are anticipating 22% plus. Again, the plus is what will interest you, and that is what we will see, how much of a plus we can achieve. The numbers are the minimum.
Okay, sir. Go ahead, sir. No issues. I'm sure that your company would achieve better than, you know, what you said, because since last two quarters, that is what the bank has been performing. So, one thing I just wanted to understand, because you're...
Last two quarters. We are exceeding the last seven quarters.
Yes, sir. Right, right. I think. Right, sir. I just wanted to understand one thing, because the cost to income ratio has been, you know, below 40%. I mean, is this because, you know, your branch opening target, that 60% you had, has not been yet met, and in the second half, you would see, you know, the number of branches coming, and that would actually raise your overall cost to income ratio. How do you see that?
I think you are right in a way that your 38% plus cost to income is something that we will not be able to defend going forward. It will move up because you caught on to the right point here that there are branches to be opened and there is some investments happening on the IT space as well. So it will move up, but we did mention last quarter that we will be below 45%. I think we will not get, you know, we will be well below 45%. I think. Maybe there also we can reduce the upper cap by 1%.
Operator
We will be well below 44%.
Sir, one more question just wanted to understand. And in this FT&R deposit, what is the rate that the bank has offered and what is the current deposit rate that you are offering after the report rate hike? Has there been any, you know, pass on to the customer?
Yes, I think the report rate, the 25, the report, there's nothing that we do. The report moves up, 25 basis, it moves up to 5.5, the entire portfolio moves up to 5.5 on the recent days. So the underlying benchmark moves up to 5.5, that 5.5 is actually implemented on the recent day, which varies for each customer as per the contract. So, over a period of three months, the entire, you know, the benchmark gets re-priced to 5.5 from 5.25. So, that's an automatic process.
There's nothing that we do here.
Sorry, what were you asking? The rate of S&R deposits called the bank has actually offered.
No, no, S&R deposits, we did make close to 51 or 52 million dollars, 51 million dollars plus, and the rate there was, you know, burn deposit rate that we were gathering is in that range, but subsequently we have dropped the rates after, and it is back, I think it is back to, I think, 4.25.
Yes, Varun, I will get you the exact number for that.
Thank you, sir, and congratulations once again, and thank you for coming quarter.
Operator
Thank you. Thank you so much. Our next question comes from the line of Nandini Kuntala with Blue Strikes.
Speaker 0
Thank you for giving me this opportunity. Congratulations, sir, for the wonderful number. Here, my question is first one. Will the bank maintain the similar growth percentage over three to five years?
Sorry, I want the first question. I didn't quite get it. You said similar what?
Speaker 0
My first question was, will the bank maintain the similar growth percentage over three to five years?
Speaker 0
And my second question is, because of increasing in price of crude oil, does it affect our bank in future forcible?
Okay, whether we will maintain the current growth rate? What we are looking for is not a 20%, 25%, 30% growth. What we are looking for is to exceed the industry's growth by a certain percentage. Our own ambition is to exceed the rate at which the industry is growing long-term growth rate.
Operator
Yes, sir. That's where.
It is so happened that in this quarter, we have actually exceeded it by 8%. But, you know, going forward, 20%. She is going at X%. We have not in our existing MSME portfolio.
Operator
Thank you. Next question comes from the line of Parth Kutka with 361 Capital. Please go ahead.
Yeah, hi, sir. Thanks a lot for the opportunity. So, my first question is, your yield on advances, you know, has gone up by 22 BIPs on a quarter-on-quarter basis. What has led to the sharp 22 BIPs increase on yield on advances on a quarter-on-quarter basis?
Thank you. Between CASA and the term deposit, when we start focusing as much on the term deposit, obviously, you are going to move up. And it has actually moved up.
If you say quarter on quarter, it has moved up.
So, to offset that and to maintain the net interest margin at the level that we are comfortable with, you know, the go-down portfolio, we have tweaked it a few basis point up.
We have also tweaked our MSME wherever possible, you know, in line with the market a few basis up.
So, we have been consciously trying to see how we can, you know, get that extra pitch from the advances, and that is paying off, you know, if you look at it, the yield has actually moved up to transition to...
The cost of funds again, you know, it has again gone up by 23 basis points on a quarter-on-quarter basis, and you just alluded to the fact that...
Apart from the fact that the term of the mix is moving in terms of time deposit, incidentally, the term deposit for the bank went up almost 29% of the year. Where the Casa, Food and Food is about, you know, the growth was being maintained, what we were having earlier, it was about 16 to 16.5%, 16.26%. So, but that having an impact on the cost of deposit, and you can see that having an impact on the cost of advances, sorry, cost of funds as well. Apart from the deposit, you know, we've also been looking at some amount of refinance, which is coming at about 7.5%. So that's a push-up the cost of funds a little.
Right. So, should we, you know, expect NIMS to sustain around similar levels anywhere between 4.1 to 4.2, you know, rather than at a higher range of 4.3?
If you are looking at, if you are saying 4.1 as the first number, I think possibly we can look at that.
Operator
And I would say 4.10% plus minus 5 basis is what we are looking at.
Sure, sir. Thanks a lot, sir. And my last question is, within the gold loan, what is the average ticket size that the bank operates at? And, you know, are we finding any sort of concerns within the asset quality within your gold loan portfolio?
Yeah, the average ticket size is 2.66 lakhs, so it's fairly, you know, it is a wide spread. So, I think 12 lakhs plus of customers we have, right? It's quite widely spread. The ticket size is about 2.6. If you are looking at the stress side of it, it is something that is engaging the attention of the bank on a daily basis. We have put in the NGB, we are talking about principal plus, there is a team that currently, when we look at around, when we have done the sensitivity for the recent, no, for presentation, if you can, page number 14 will give you that. We have given that the price reversal of up to 20% is something that more or less the portfolio can sustain. You know, 3.3% is the crash in gold price of up to 20%, of the gold loan that will be above the market is just 3%, a little over 3%. So, it's a fairly resilient portfolio. The portfolio LTV is at 62.35. And in September 26, you are together. I mean, that is, per portfolio, at least one day, is just 28 crores. So, this is a portfolio that we are, you know, managing on a dynamic basis.
Operator
Thank you. Next question comes from the line of Jyoti Khatri with Ambit Wealth. Please, go ahead.
Speaker 0
Yeah, thanks for taking my question. It's a couple of things. I hope I'm audible. Firstly, I just missed on to your marginal outlook which you mentioned.
Operator
I'm sorry to interrupt you, Jyoti, but there are a lot of background noise coming from that.
I'll respond to your first question. What I just mentioned to me, the other, that we would be looking at, yes, our focus on resource security, We saw the cost of deposits moving up a bit, but we have tweaked our advances also in a similar fashion. We did end up the quarter with a 4.19% net interest margin, but going for the rest of the half year, going forward, we are anticipating. We believe, we did give a guidance of 4%, but we believe today that perhaps 4.10% plus minus 5 basis is something that we will be able to defend for the next half year. Yes.
Operator
And participant has left the queue. We can move to the next participant. Our next question comes from the line of Deepak Jay, an individual investor. Please go ahead.
Hello, I'm Aravind. Thank you. Thank you for the opportunity, sir. Congratulations for the Q2 results. It's one of the greatest results in our history. Again, we proved the bank's ability to generate the returns. So, I am coming to my question. So, my first question is, how much possible is the floating loan in our loan book, sir?
Floating loan in our loan book would be something like 95%.
And the floating loan book has two components, which is a repo-linked loan and an MCLR-linked loan. 52% of that is repo-linked, 43% will be MCLR-linked. And we have approximately about 130-odd treasury linked to loan, and the balance will be fixed rate, which is part of it is staff loan, and part of it is loan-again deposit.
Thank you. Thank you, sir, for the detailed explanation. And my second question is, the bank facing current dispute, a small portion of the ownership, that case is affecting the bank giving any bonus or split or any equity increase further or that will not affect if you decided to give bonus or split for the near future or anywhere in the future, sir?
Yeah, I think we have given a bonus earlier. The only challenge before us at that point of time that we gave a bonus to a certain disputed categories of shares as well. So we never looked at the color of, you know, the disputed category shares, the bonus was issued to, for example, if it was under ED's attachment, we actually gave the bonus shares also to the ED. Right. So, I don't think that is going to come in the way of a split of shares or, you know, in any manner. But having said that, I think we would like to look at that, you know, after a, you know, I hope you know that, you know, that the show course not is one case has been, the affiliate fibunal has come out to the order on the 9th of July. And if you check into our slide number 42, we have given a disclosure on that, that now we have filed an application before the RBI to regularize the transfer of shares. And the same is under consideration. So, going by what RBI says, we will call, obviously, the regulator, whatever the regulator says, we will be 100% compliant of that, and that is also true for whatever call that they take on these shares, we will abide by that, and we are awaiting the RBI's response.
Sure, sir. Thank you. And my, another question is, what is the insurance commission income for the bank, sir, in this quarter? Insurance commission, how many? 26 crore.
In the six months. It is about 9 crores in the first half year, right? Something that we are zeroed in not to improve. You will see a substantial increase happening in this.
So, and my final question is, in past, we have did very much technology capex. So, how this yielding was now? What is the feedback? What is the output for now? So, that's it from my side, sir.
Yeah, yeah, I think that's the numbers, you know, you are seeing the technology and the automation of the processors is aimed at productivity increase. And it is that that is driving this growth that you are seeing on the table.
Operator
Thank you. Our next question comes from the line of Sarvesh Gupta with Maximal Capital. Please go ahead.
Yeah, good evening, sir, and congratulations on a very good set of numbers. So, sir, first question on the NIM side. So, basically, now you will have two opposing forces. One is because you are growing at 20% plus, so you will have to go for more term deposits because CASA probably cannot grow beyond mid-teens. And then the mix would be changed unfavorably In terms of term deposit, which is what we have seen. So deposit pricing overall will go up. But at the same time, you know, there are positives also. First of all, your rate increase of 25 basis points and probably more going forward. And then also because banks are flush with CNRB deposits, and they may not be looking to increase the deposit rates quickly enough. So, given these two opposing forces, do you see a decline in your name going forward? Because you are talking about 4.1, which is, I think, already lower by 10 basis points compared to this quarter, which was lower by 10 basis points from previous quarter.
Let me tell you, whenever we talk of a number, you look at the behavior of our number, the number is always the minimum. I think we will start to benefit from whatever you have stated, what you have stated that, you know, the term deposit rate, at least in the short term, is not likely to move. Portfolio has actually benefited us in the quarter too, that in the investment portfolio, that has moved up that extra 2% that we have entered in the investment, you know, into the investment, which carries a much lower, the yield is somewhere around 7% as compared to about 10.3% of that one. So, it's a 3% kind of number, which is also, the surplus has also costed us in terms of NIM. So, when I said 4.10, I had actually said 4.4% in quarter 2, that is the NIM that we maintained. Now, I'm saying it will be 4.10. It is always a minimum, and we only play on the plus, the extra on that.
And secondly, sir, on the term deposits that we are raising, what is the mix of the stock as well as the, you know, the amount that we have raised in terms of bulk deposits, which is coming at a higher rate versus, let's say, a usual retail term deposit?
Bulk deposit, do we have the numbers straight away? What I do have the numbers straight away and which we have put in is from a resource security perspective, because bulk or otherwise the rate of interest gets captured, you know, in the 5.85% that we did mention as the cost of deposit. But from a resource perspective, resource security perspective, we are also So, looking more and more at the non-callable deposits, right? Today, in the incremental term deposit, non-callable is 40.62%. So, which means non-callable are deposits. See, even term deposits can be, you know, prepaid, you know. They ask for a free payment, we will be obliged to give. From that perspective, it is volatile. Term deposit has, but non-callable by the very nature, has no prepayment attached to it, which means it will be only prepaid on maturity. So that share in the overall term deposit is going up. But on the bulk, you have the bulk number? 19.9. 19? On the total deposit. 19.9%. Nineteen percent is the total, is the bulk deposit over, in the overall total deposit.
And in this 7570, how much is the bulk deposit raised?
In, as I mentioned, 19 percent on all the, on the total deposit, total deposit of 69,000 crores. So, you have this 7570, what is the bulk deposit component? We'll get back to you on that. Okay.
Okay. And then finally, one question on the gold loan. Now, you know, because we have seen some softening of gold prices. Yes. So, at the industry level, from a risk mitigation point of view, are you seeing, you know, players trying to lower their LTVs to sort of safeguard their incremental book going forward? Because if there is further, of course, there is further sort of softening in the prices, then the risk portfolio keeps increasing. So, at the industry level, how are you seeing people behaving in terms of LTVs?
Yeah, I was just responding on the gold loans. I think this is something that the industry is worried. Certainly, we have been proactive from the PMB side. We have put in place, you know, systems that can track the LTV at the individual level on a daily basis. We have 12 lakhs plus customers, and at the individual level, if I say it can track, you can imagine the kind of systems we have put in place. And the tracking is on the principal plus interest accrued up to date. So that's the kind of tracking we do, and from that perspective, our portfolio LTV is 62.35%, and our portfolio currently can tackle a price reduction almost close to 20%. So that's the, that is the kind of, you know, fairly resilient portfolio.
Operator
But you are right in a way that, you know, the volatility in the gold prices, the competitors
associated with the gold, the market is watching, and it reached 4,000 dollars an ounce yesterday, and it's slightly come back today. Obviously, the market would have to drop the per gram rate in line with the prices that are moving in the market, in whatever direction, have to be appropriately tweaked in that direction. So, currently, the market is, the prices are going down. I'm sure the industry will mark the prices, the per gram rate down in tune with that. We have already done that. I think we have already, in the last few days, we have reduced it by as much as H&O to 50. So this is something that we will, it's a dynamic thing that we, the point is to ensure that the gold loan portfolio stays resilient, Robert. And let me also tell you that on 30th, 30th of September, our gold loan portfolio at risk one day is just 28 crores. It's 0.10%. I'm talking about SMA 1 and 2 together.
Operator
Thank you. Our next question comes from the line of Burundu Bay with Share India Securities. Please go ahead.
Thank you, sir, once again for taking my question. Just wanted to understand a few things, sir. I mean, you explained about the gold loan prices impacting, you know, the world gold business, sir, but what about the impact of drought? Because states like Karnataka and the Pradesh Maharashtra, they have declared drought. So, what sense are you making and if any agro-gold loan book would get impacted, do you can throw some right on that?
Yeah, yeah, I think the draw can have an impact. That's why I said, no, that we have, you know, put in place a system to track gold loans on a daily basis, on an individual basis, as well, and on account basis as well. And we have also, apart from that, we had up asset resolution teams in our regions, there are 13 regions of us, to take counteraction in case, you know, at any level it goes, you know, the cushion gets reduced to 10%, which is the LTV, which is the principal plus interest, which is the LTV of the day, touches about 90% of the market value on that day, you know, margin call. We are also putting in place such teams, apart from the margin calls, even the looking at, you know, what is that call center you are making? Okay, sir.
But, sir, it's not impacting the overall demand, right? I mean, just a lot of conditions.
I think it continues to be resilient.
The demand continues to be there. Okay. Okay, sir. One more thing, just for you to understand, what could be the IRDI, you know, insurance norms impact on your overall ROA? Have you made any? Yes, sir. Sorry, come again. The IRDI, new norms, insurance norms, impact on your overall, you know,
Let me also tell you that, you know, this is an income stream that is being, it's only picking up from the insurance is just 9 crores. Our commission that we earn from the distribution of insurance products, Ashok, is 9 crores. So what is going to be the IRDA impact, Ravais Noam?
We will have only 20% impact, sir, because we are not more dependent on that.
20% reduction So, the impact is approximately 20%, which would be more than made up from incremental business, and as it is, the number is fairly small at 9%.
Operator
Thank you. Next question comes from the line of Kart Gutka with 361 Capital. Please go ahead.
Yeah, hi, sir. So, sir, on the disputed shares, you mentioned that you have made an application to the Reserve Bank and you are awaiting their response. So, say, for example, you know, the Reserve Bank replies positively. So, will that be the final verdict or will still have to go to other regulatory authorities to get their approver or get their clearances?
Let me tell you on the show cost notice itself.
This order came out on the 9th of July, right? If it has to be appealed against, you have a 60-day window, right?
And in that 60-day window, if you have an issue with the order, it has to be appealed. The bank has not gone for an appeal. Let me also tell you that EED also has not gone for an appeal.
In the 60-day window, nobody has appealed so far.
Operator
So, that's the appeal time got over by the 9th, I think sometime mid of September.
But again, with the high court intervention, you can go for an appeal. You have another 60 days to go for an appeal. So, so far, neither EED nor the bank have gone for an appeal. So, let's apply for an order. Because this is a FEMA issue that is involved, the regularization is only and only with the Reserve Bank of India. And it need not be referred to any other regulatory or non-regulatory or a judicial agency. It rests only with the Reserve Bank of India. Okay, okay. Fair enough, sir. And it has been done. It is with the Reserve Bank of India, and they will take a call.
Okay, okay. We will abide by that call. Sure, sir. Sure. Thank you, sir.
Operator
Thank you. Ladies and gentlemen, that was the last question for today. I know and the conference over to the management for the closing remarks. Thank you. I know to you, sir.
Yeah, thank you, and thanks for participation in this con call, the investors' con call. And as I have said, the transformation mode, we are plotting a lot of structural
Operator
changes on HR side, on the business process automation, on the IT side, all getting reflected in the numbers.
So we have delivered numbers that are quarter after quarter, you know, better than the previous quarter and our own guidance. And we will see, we will continue to strive in, and it is also committed to possible sustained efforts. And like I said earlier, that our, it is not a 25% or a 30% growth that we are looking at,
Operator
or a 20% growth or a 15% growth even. What we are trying to do is, this quarter we did that at 8%, the delta was 8% faster.
And what we are looking on as sustainable long term is 4-5%.
Operator
We want to grow faster than the industry.
So thank you very much for attending this call.
And like I said, we are committed to a profitable bank. We are committed to a robust bank. We are committed to a bank that delivers on quality both in terms of how our advances are doing and also in terms of our own customer service. Thank you. Thank you very much.
Operator
Thank you, sir. Ladies and gentlemen, on behalf of Tamil and Mercantile Bank Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.
