Union Bank of India (UNIONBANK) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Union Bank of India Earnings Conference Call for the period ended June 30, 2026. The bank is represented by the Managing Director and CEO, Sri Ashish Pandey, Executive Director, Sri Nitesh Ranjan, Sri Rama Subramanian S, Sri Amresh Prasad, and other members of the top management. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator per pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand over the call to Mr. Ajay Bansal, Deputy General Manager. Thank you, and over to you.

Thanks, ma'am. Good afternoon, ladies and gentlemen. I, Ajay Bansal, Head of Investor Relations, welcome you all for Union Bank of India Earning Council for the period ended June 30, 2026. The structure of the council shall include a brief opening statement by a respected MD and CSR, and then the floor will be open for interaction. Before getting into the call, I will read out the usual disclaimer statement. I would like to submit that certain statements that may be discussed during the investor interaction may be forward-looking statements based on the current expectations. These statements involve a number of risks, uncertainty, and other factors that cause the actual result to differ from the statement. Investors are therefore requested to check this information independently before making any investment or other decisions.

With this, I now respect our respected MDM CEO, sir, for his opening remarks. Thank you, and over to you, sir.

So, thank you. Thank you, Mr. Bansan. And with great pleasure, I welcome all our analysts and the investors on this coin call to Union Bank of India, your bank financial results announcement for the quarter-end date 30th, June 26th. So, to have a more Q&A and understanding, I would not go much, but as of, you know, all of you know. So, to just set a context. But what the economy we are in and what are the disruptive situations happening across the world and how it is impacted, the conflict. But at the same time, our country is well poised with the various proactive efforts taken by the policymakers, the government of India, the regulators, the Reserve Bank, and the various state governments as well. So I think we are resilient and we are in a position to navigate. The impact of oil prices, trade linkages, logistics, currencies, and rate movements. So I think with this, if I recall the earlier three in sequence, this is fourth, but actually it is three, like, you know, the three earnings call which we had, the analyst or breast meat. for last three quarters. So, we were very clear in communicating that your bank is working upon five pillars. First is efficiency, second is robustness, third is quality and sustainable growth, fourth is profitability, and fifth is customer centricity and ease of doing business for staff. And equally, you know, we are having weightage to all these five parameters. And I think the improvements which you must be observing quarter to quarter from December 25 onwards, I think it is aligning to these five pillars only. So we had also informed you that your bank has done, like, you know, the bank is now, various structural changes have also taken place. In some of the things like on technology, on operations, Project Muskan we are running, which now we are getting the real good juniors of it. Meanwhile, we have created certain verticals like ecosystem banking. So public sector banking, I think we could achieve within the last six to seven months. Now that entire sourcing of business is separate. Where we are having 1200 plus people at the ecosystem banking vertical, headed by CGM, and then he is having 7-8 GMs, and then 14 DGMs, and then around 200 people, 118 centers, and 12 hubs. So these people are either related to administrative work or not related to the branch work. They are totally in the relationship management and that is why the CASA we are in a position to sustain from June 25 or March 25 or September 25 levels. And if we speak... Certainly, even for the June quarter, very well, that when we talk about, you know, the low-cost deposit, we talk about CASA plus RTD. So, CASA, even in the June quarter, I can give you the average figures, is around 24,000 plus crores. Average CASA we have maintained during the quarter, and RTD we have maintained average as a 17,000 crores. Total put together 41,000 crores. And on the... We have shut off around 18 to 20,000 crores of gold deposits. But shut off doesn't mean that we are not taking the deposit. We are taking the deposit, but in the last. The first thing is that we have a capital base of 18.46 percentage. We are at 74% level, and today we are at 86% level. It means around 12% growth. So it gives a good... That's why efficiency is maintained, and we are in a position to come with some better figures, as we promised to all our investors earlier. So... Even, I would not like to give figures, but even today, our average CASA figures are better than the June 30th CASA figures, because that is what I am saying about the vertical which we have created. The match, the registration which we are doing around 12,000 to 13,000 per day is increased to 18,000. So there you can think of because the fee-based income and other things are generated through all these activities. And, uh, I love to... In a quarter, more than 205, not wrong, corporates, we are integrating. So that our stickiness, as in the press made told by our CFO, he will again, in brief, he will tell, but it is around 95, somewhere to 99 percent stickiness in advances, in savings, and the current. So, I think that is a good color which gives that we are the bankers now, what they said, is working upon the average figures. Now, in this quarter, we also got excellence, some award, IABF Excellence in Governance and Compliance, TransUnion Civil Award for Best Data Quality Bank, IABF Award for Cyber Security Team, and Economic Times Enterprise Security winner for Data Privacy. So I think these are the some things because we believe that business first and compliance always. If we plan to grow another five, six lakh crores from here, so we should be on the various robust base rather than only on the superficial, you know, the foundation. So that is the reason we are working a lot. We have created a centralized, because our presentation is very clear on the things which we have done last six, seven, eight, nine months, and we have told in each of our invest and presentation call that what we have taken. And we also said that it may take nine months to one year time to get into it. And the first thing is that this is the highest ever profit. Even in March, we told highest ever profit, highest ever dividend. And even the Q4 ROA was 1.36. So last three quarters, we are maintaining the ROA of 1.36. This time, yes, cost to income, we told, we are working hard on it, and almost 500 basis points, or 500 basis points, or 5 percentage points, we have come down. OP is almost high for the bank, for this, it's costing 8,000 crores. Even the NIM is the highest level, costing 10,000 crores, and the other ratios, certainly, you have our... You have our presentation. The GNPA, NNPA levels are again one of the best. So now I can say that your bank has come to a real foundation where, you know, we are now in a position to... To take forward very nicely. Coming to the growth in advances and other cases, you have seen, we have clocked a good growth. First quarter is slightly sluggish for everybody, but the first quarter is also in banking industry generally gives a negative color on the slippages and the SMA position. But then your bank is, I think, the best of the numbers, even 1,000 crores less than the match figures, around 2,800 odd in SMA 0-1 to above 5 crores. I think that's also one of the good colors, which gives 99% around civil score. So we are shifting from lower civil score to upper civil score. That is what you will see in the presentation. Even 25 crores and above, when we talk about the external rating, so we are maintaining that. So we do not want to compromise on the quality at any of the cost. But at the same time, the industry level growth plus 1%, we aim forward, and certainly we look for, now, up to now we said we would like to defend NIME, but then from here we would like to improve upon the NIME. So, defending is for sure, and improving is the aspiration from here. Further, more. And coming to the deposit, it is not like deposits we are not taking, because there are various maturities over the year, spread over the year. This time also we have taken 30,000-40,000 crores of deposits, but our first choice is CASA and RTT. So this is where we are trying to build, because of this strategy only, the deposit cost has reduced by 18 bps. I think that is the... which has also helped the Liman and other important parameters. So, I think with this, I would like to give the platform to all the investors, and you may ask the queries, and we'd like to answer that during the call itself. So, over to you, Mr. Banker.

Thank you very much. We will now begin the 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 will wait for a moment while the question queue assembles. We'll take our first question from the line of Maruk Arjania from Tara Capital. Please go ahead.

Hello, sir. Congratulations. So, my first question is on deposit growth. So, you explained very well on how you've been shedding bulk deposits, but the gap between deposit and loan growth is quite wide for us now. So, when do you see a pickup and deposit growth? Because the gap has to be bridged, right, at least to the sector level. So, that's my first question. And my second question is on FCNR mobilization. How much do you think you can mobilize, and what's been the mobilization so far?

Okay. So, thank you so much, because it is your bank, you are the investor. So, we are the custodians. So, always I say to you, I know you for very long, and I always say like that. See, the deported group is not at all an issue, if we ask. The CASA and RTD is an issue. So, I think we are actually, you know, hitting on the grassroot level of the issue. And there itself, it is not like, you know, if we talk about bulk deposit shedding, it will not give a good color. The right set of colors is that first our own capital, we are sitting at 18.46 levels today. And if you see the June 25 or March 25, the CD ratio was 74% into the 86. So 12% and how much 1% is it kept as true?

10,000.

So you can think of around 1 lakh we could build straight away from our capital itself. So that is the first mood point. The second one is that we also, in my commentary or introductory brief, we have told we are working a lot hard on the CASA and RTD and stickiness, which we have answered. So that is also now not an issue. And the bulk deposit, it is not like we are not taking. Every quarter, even in this quarter, it is around 1.35. How much is this? So 79,000 is for, and even Q1, it was more than 1,35,000, 1.39 lakh crore, which was getting mature. So we are taking it. But the thing is that our first priority is, very, very clearly, the first priority is the CASA and RTD. But yes, now going forward, We are taking, we will be taking, but then we will be taking where, you know, Thank you. The total deposit ratio was around... Which has come down to 19 or something. So it means around 7.5 to 7.9% we have reduced. And that's the reason the efficiency is coming on. And going forward, it is not seen. We have to see the total deposit. So going forward, our aspiration, maybe it may take one year, two years, three years down the line. To bring renewable deposit to 1.15 percentage points. So that will give more stability to the bank on the funding part, on the pricing part, on the cost of deposit part. And certainly, let us look the most important pillar, madam, which is LCR and NSFAR. It means 2,000 crores, approximately, roughly. So, 21% means around 42,000 crores we are in an equity position, comfortably. So, we are sound enough on that. So, suddenly we have gone with the level where we required, we have taken the deposit, but going forward, certainly, because now CD ratio has also, I think, almost it has optimized. So going forward, we will be taking the deposit, and certainly it will be, when we say the advances, it will continue 12 to 13 percent plus some levels, because we would like to grow with industry plus something on the credit growth. So certainly in the similar range, minus 2 percent. Then, somewhere, deposit growth will continue. Coming to FCNR, I think this is also a core-related question to the first one. The FCNR, we have already done 1.05 million, 1.06 million up till now, and we have not done any averaging up till now, but we are in talk, and we will be going forward with that, and we aspire to, not aspire, but it is an issue, we will be in the position to garner 1.522 billion going forward till September. So, this is the color on the FCNR, and OFCCV around 200 to 300 million we plan on that route. So, this is the total plan on the scheme given by the Reserve Bank of India and the government.

Okay, sir. Thank you.

Thanks a lot. Thank you. Before we take the next question, we would like to remind participants, to ask a question, please press star and one on your phone. Next question is from the line of CA Dr. Ashok Ajmera from AskOnGlobal. Please go ahead.

Yeah, thank you for giving this opportunity. And compliments to you, sir, Ashistar and the entire team for a good set of numbers, especially on the profitability front. Even in the first quarter also, you have matched the profit rather improved it by about 100 crores. Which is good heartening to note. And even the name is also very healthy as compared to the last quarter and even otherwise also. So my compliments on them. Sir, having said that, I have got again the same one major concern is about the business growth, overall business growth and especially. Which is linked with the deposit and the credit growth. So the same question which Maru had asked about deposit front, you said you are comfortable on capital education wise. But sir, if you compare with the even industry also, I think in the overall business growth as well as the credit, I think we are a little bit lacking, which was never used to be a phenomenon one and a half to two, three years back in the union bank. So, having said that, what can, I mean, what can be done to increase this number? Because now, you see, even in the first quarter also, some of the banks which have declared the results have given very healthy numbers of the credit and overall businesses also. So, on this, a little more elaboration, a little more kind of a foresight from you would help in understanding the future of this bank. So, this is my first question, sir.

Okay. So, thank you. Thank you so much, Ajmira Saab. On both the things, we have already answered on the deposit growth to Madam Mahroop and to all the investors. And let me tell you, when we talk about 1.5 to 2 billion on the FCNR front, how much it comes to Indian rupees, approximately? Around 20,000 crores. So when certainly you have a roadmap for this quarter itself, because this scheme is for September only. But then, our main focus is the CASA, and I think let us understand in total deposit, there are three factors. One is the CASA, another is the retail term deposit, and then bulk deposit. So I think in CASA and retail, there is a huge growth in Union Bank of India. So, I think that is one notable, remarkable feature, quarter to quarter. You can compare from the March to June to September to December and to March and again to June. So, even in the average, even in the average, you can see there is a lot of improvement. So, any stickiness in the press meeting is simply our… CFO has told stickiness in saving, that is stickiness means the average figures to terminal figures of the quarter end. And again, I will request you to inform all the investors on that count. But let me tell you that all these things are to manage, structurally manage efficiently your funds. But then it cannot be endless. So, going forward, we are taking deposit, we will take, and certainly you will see, like, you know, see, this was actually the anomaly which was there, which we have tried to... Rectify and improve upon the efficiency. Now, when you talked about the other banks also or maybe the other organizations, and we compared to Union Bank, like the cost to income, like the cost of deposits, like the NII now and ROA. So, there we could build the efficiencies. But then certainly, going forward as we move from quarter to quarter, till this near end, you will see the same, because we are in the industry, no? From somewhere money will not come. Money will come in the market only. And certainly we are there to cater it. And when we say, and when we talked about credit growth, and certainly the Q4 growth you have seen is one of the best. It was around 7%. So there is no doubt in the growth on the credit front. And suddenly the first quarter remains a bit, but going forward, even we have almost more than one lakh crore of a sanction, but not disbursed. We have a pipeline in the corporate itself, and ram sector, we have now come up with the cluster scheme, we have come with the agri-uniti scheme, so we have come up with various schemes in the MSM in agriculture and in Italy. So we are very sure that not only 11 to 12 or 14 percent, but we aim to move better than 18 to 20 percent in these three sectors going forward. And that's the reason we were surplus. Earlier we were in deficit in agri and all. But last quarter we have sold very good... And we have booked a good income. So, certainly, all this shows that we are in a position to make a growth and we have a good visibility on the growth. So, certainly, with that credit growth, the deposit will follow in line with that.

Sir, quite well taken, sir. We are well-wishers of the bank and would definitely like it to. You know, to be in line with, on every parameter with the other banking industry on the whole, or rather do better. Having said this, sir, there is a little, uh, uh, Concern on the receptive side, because our recovery from the return of account in this quarter is almost half of the March quarter, which generally is a good quarter, I understand. And secondly, the provision, NPA provision has also gone up substantially, 2020 crore from 420 crore in the March quarter. And similarly, if you see the SMA 2 numbers, overall SMA numbers have come down, as you said, and as we can see. But the SMA 2 has gone up by around 350 crores. So, overall, do you see some kind of little stress in some of the MSME accounts or some other accounts? And something, if you can give the information on the ECGLs, this new ECLGS, how much is the entitlement of all the customers and how much money has already been dispersed on that?

Yeah, Namaste, sir, Ajna, sir. Regarding the recovery, if you are looking at it, March quarter and this quarter, if you are looking at it, March quarter, there was one bulk was there. I think everybody knows it, the Supreme Court order or one of the accounts where we got a good recovery. If you remove that, more or less, we are in tune with that because as already also we have explained it. The bigger cases are not coming out. Actually, there is nothing much in the NCRT. NCRT has more or less dried up. Everything now is being done through OTS. We are also having a low catalogue. There are new things only. We are trying to see how to recover the remaining amounts. TT itself has been coming down. The stripages are not happening to a large extent. We have been controlling the stripages to a great extent and there was not much stripages. So the recovery, whatever it is done, there is a good team which is taking care of that. That is number one. Regarding the stress in MSME, yes, it was there, it is there, and it is going to be there, because the MSME are depending mainly on our economy. When the economy is very, very in a very unstable condition, automatically there will be stress on the MSME portfolio. But one thing is, it has been quite well managed by the banks overall, and the government also has helped us with this ECLGS scheme, where they will be able to help the MSME sector to a large extent. And if you look at it, our stress in MSME sector also, it is on the... Low-value ticket, not on every medium or high-value ticket, there is not much stress. The low-value ticket, which is more of a state-sponsored schemes only, we have it, which are all quite covered with the guarantee cover from the government also. And regarding ECLGS, if I can say that, we are expected to... Around 14,000 to 15,000 crores on the overall. And already, we have completed around 10,000 crores disbursement in that case.

So, I think when we are talking about SLA figures, see, we are 1,000 crores less than the March figure. Generally, you will see heightened stress and slippages in the June quarter, Aljira, sir. But, fortunately, and with all good hard work and substantially, you know, managed this entire portfolio on asset quality, we are actually the lowest on the SMA, which is 2,800 crore on amount. So, that is point number one. Point number two, our recovery is lower than the slippages. I think that is also quite an important point, second point, in the first quarter itself. The second is that even though if you... You know, reduce that the major one which came in the last quarter, last year, last quarter, three, four, and straight away, you know, not only that, by putting our own money, we have put 700 crores of the additional provision, which is nowhere part of the TITU or part of your profit or part of your PCR. And this time also again we have put 100 crores. So it means total 800 crore, and I think any shareholder, investor, or any stakeholder, whether regulator or government of India, will feel good that when ACL guidelines are in place and we are going to move, now already four months are over, and the bank has kept 800 crore aside today itself. I think that is a very good sort of a clue to each one of these stakeholders. Like, you know, one more thing I would like to, because it's the... The MSME is a very important part of the economy, and we take this very seriously, and Azimeta saw what he had done, he said, for information to all the investors here listening to us, because the government was also keen to know. The impact of East Asia and other things happening on this MSME, and also the Reserve Bank was also very, you know, cautious. So we have done all the 140 regional offices. We have conducted MSME customer meets. For almost one to two hours, ranging from customers from 15 to around 30, and in all those meets, our people virtually have joined Chief Economist of the Bank and GM and SME, and one to one, as per their business, we ask them that what heat they are facing, whether on the input cost or on the fuel cost or maybe on the logistics cost or orders or delete, what's or not. And we have compiled that actually book, and we are working upon each account, whether we have to give ad hoc to them, whether we have to do fast review renewal for them, for delayed, where RBI relief measures has to be given immediately to them, ECLGS. So ECLGS, when we have 12,000 crores, is our sanctioned book, and this was 10,000, and certainly, time period, hey, it is there. So we have been a position to cross going forward a good amount. So that is the reason we did this study, and this study we have done for two months, and it was like... Our regional head, journal head, MLP, MLP news.

No, yes, sir. No, just 10,000 figures, because I was, in fact, I am driving to that point only that out of the total, about 18,000 total credit growth, net credit growth in this quarter, I mean, 10,000 crore, according to you, has gone in ACLGS disbursements only.

That is not correct, because ECLGS displacement happens in the... So, we have done a great analysis. Let me also tell you that not only MSNU are small people, even the big corporations... Thank you. It is not that they are in stress. It doesn't mean that this 10,000 crore or maybe any other bank who has sanctioned more or less than this amount, it means it is going to be stressable. A society which is much more informed. which has happened during COVID in another period. Now, when this scheme came and when they saw the heat on the input and other cost, they immediately took the benefit of this and took actual disbursement in all the CCs. As per the rule also, it was to go in CCs. the balance of the CCs rather than, so that calculation probably mathematics would not work here, that if 18,000 growth is here particularly, then EC and GS 8,000 or 9,000 has actually set up. It reduced our CC balances and most of them are sitting on it so that in case of any eventuality, they will be in a position to make good of themselves. And also they don't want to leverage much. Making ECSGS on one hand, and then utilizing that money for some other hand, and then coming into problems. So most of them, we also discussed independently. When we did this exercise, means we did this exercise wholeheartedly across the customer base, across India. So I think 2,500 plus MSMEs, we have done this exercise. So, outcome is very clear. It is not that equation that, as we are thinking, it has gone to CC and it has reduced the CC. It is on the, you know, in France, so there were some repayments, because everybody knows that after March quarter, it comes as a repayment firm. And it is a bigger benefit, it comes. So, it is across, but yes, gold we have not grown. And that dent has actually done around 3,500 to 3,000. And now we are building because we wanted to abide by the regulatory guidelines. We don't want to do the business in Haribari and then become a non-compliant. So we have worked a lot in the last two months on the gold loan, agriculture, and what are the prescriptions, regulatory prescriptions, and how to go about it.

Sir, the last one in this round, sir, on the... Thank you, Dr. Ajmejad. Please join back the queue, please, as we have participants waiting for their turn. Thank you.

Okay, all right. Thank you.

Ladies and gentlemen, in order to ensure that management is able to answer queries from all the participants in the queue, kindly restrict your questions to two at a time. You may join back the queue for follow-up questions. Next question is from the line of Kunal Shah from Siri Group. Please go ahead.

Yeah, thanks for...

Sorry, your audio is not clear?

Yeah.

Is it your handset? Yeah, is it better now? Yes, please go ahead.

Yeah, so the question was on ProVishti Kagi, maybe almost like a thousand or crores of NPA. And coverage has also dropped, and we see a much higher write-off as well. So, is that number more to do with the write-off, or maybe the provisioning towards the write-off, and then the accounts get a return-off, because that quantum appears to be slightly higher. Slippages have just been flat, but still we have seen almost 1,000 crores of NPA provisions.

So, you must be observing that slippages are almost flat QOQ, but the write-off is higher, and to maintain the gross NPA and to have the proper tax planning, we need to write-off. If you look at my Q1 number of write-off, it is almost in this quarter Q1, previous year Q1, the write-off amount is almost aligned.

So, this is just a quarter phenomenon. It will not continue because maybe this will...

No, it will not continue, Kunalji. I would put it differently. If you see all our ratios, it is one of the best. And also the profit is one of the highest levels. So, now everything is there and certainly, you know, we need to clean the balance sheet. So, wherever possible, we take that stance of clearing the balance sheet. Even that 100 crore, we have put additional. So, now it is earlier last quarter of 7, this time 100 plus means 800 crore. We have put, set aside for the, for the eventuality of the ECM going forward. So, I think this gives a very good color that, you know, yes, if provisioning would have affected the profit and the ratios, probably it would have been correct. But the apprehension would have been correct. But the question here is that we are at 1.36, and the name has improved to 2.80. All the ratios are better and highest, particularly for the Union Bank of India. So I think keeping those in view, we also need to clear the balance sheet. And then, suddenly, when we clear the balance sheet more, So 7.50 into 4, it comes 3,000. So certainly, it will be around 4,500 to 5,000 crore in the entire year, which is, again, much more than the last year, though there was a TW recovery, I am saying. But as far as total recovery is concerned, it's much more than this typical.

Got it. And the second question was...

Even our tax provision, we are doing fully, so it is around 1691, Karol? 19...1960. 1960. 1960. No, no, I think 1691. That is what I am doing. Tax provision also we have done on the operating profit because we are at highest operating profit of 1,003 crores. So on that basis, around 21% we have taken and provided.

Second question was, when we look at cost of deposits, because of the rundown in the bulk, which is down by almost like 20 or 1,000 crores, there is some savings on cost of deposits. It's down by almost 80 odd business points. But cost of funds is still steady. So we don't have that borrowing number. So was there anything on the borrowing side wherein cost of funds are still remaining generally flat at 4.37 during the quarter?

See, there are certain entire two bonds, which are of prior period, which are at higher cost. One we have shut off during this quarter at 850 crores. And in this quarter, again, I think we have 2500 crores. And some of them are at even 9%. So I think going forward, you will see that 870 is a blended rate. And we are already sitting on 18.74. 18.46 of capital. So certainly we want to reduce, and I think going forward, you will see both, you know, getting reduced.

So 2,500 crores raised at the blended rate of 8.7 during the quarter.

Yeah, it is that call option we will exercise.

Okay, got it.

Thank you. Next question is from the line of Dixit Doshi from Whitestone Financial Advisor. Please go ahead.

Yeah, thanks for the opportunity. So, my first question is, you know, last year we had zero PSLC income. This year there is a sharp increase in the fee-based income. So, if you can mention how much we have done in the PSLC this quarter. That's my first question. Can you give some estimate about the ECL provision requirement from next year?

So PSLC, last year this quarter was zero. This year this quarter is 217 crores. And as far as the second part of your question extension,

CEL provisioning, actually we did PSNC, but in the last corresponding quarter, it was 100 crores, but then in a year it will come. But this time, since December quarter and March quarter, we worked a lot. So we had access, so that is where Agriculture SMF, we have sold it around 217 crores. The second one, the ECN. ECN is around 6,000 crore total. The total requirement is around 11,300, but we are carrying 5,500 crore of additional provision. 6,000 is additionally required, which I think even if we take on one, it will be decided in the board and other things, but then one quarter, I think, but then there is a... Regularly, you know, we arrange for, I think, many quarters. So, we can decide over the year. 800 euros already we have put in the balance sheet even today.

And you are saying that 5,500 crore we have already done. So that 5,500 crore includes this 800 crore, right?

So around 6,000 crore is remaining.

Okay, around 6,000. So are we planning to do more in the remaining three quarters this year itself? Because you are saying that...

See, I would not go for it, because, see, now we require only 6,000 crores approximately, and 800 crores we already have. So, but we would like, you know, sustainable business growth, sustainable profitability, and sustainable all efficiency ratio. This is our first, first priority. And after that, even if we are remaining with something, we keep on building. But now nothing is remaining. Only now three quarters are there. And after that, not even three. Two quarters are there. Because this has to be done somewhere in the 31st of March before that. No. Because some posterity is applicable. So all the banks both will decide upon the approach they are adopting. To handle this being there. So, I think we are very comfortable on that.

Thank you. Dixit, I request you to join back, please. Thank you. Next question is from the line of Anand Dama from Nuwama. Please go ahead.

Thank you for the opportunity and a very good set of numbers. So my first question is that, you know, I think you talked about the ECL impact of about 11,500 crores, but what would be the annual run rate that you should see once I think we have implemented on the 1st April 2027? There will be an annual impact as well. Whether that will be 5 basis points, 10 basis points, 15 basis points, how much have you assessed? That's going to be the annual credit cost that you're going to just see only because of ECL.

What is it?

Absolutely local. The thing is that what we are saying 11,300 is putting on both treasury and as well as on the credit side. Putting both. One day. And then ongoing it will be like you know the stages. We can add that each month. So it will have both positive and negative depending upon. The thing is that we are actually, right now we are working upon that, and that is why we could contain our stress level at this, even June, 2800, okay, you can tell some basis.

Even if we, even if we absorb the entire thing in the year one, which is the 2027. From 18.10, which was our 313 CRAR, it would just go down to 17.54. So, even then, we would be very comfortable. And going forward, of course, we have a provision of adding back each year, and we can face it out over the next four years. So, in any case, we will not be, you know, not shy about it.

This model we are considering, and we have taken, I think, in Y. I think that figure we are working, but that we are not finding.

I think you can yeah certainly you can work around and let us know what is the I had amount of there was so much of disturbance I could not get if you said any figure what will be the annual level of incremental credit course that you should have because of ECL. Nevertheless So second, you know my question was that We have seen farm loan waiver in the state of Maharashtra, we have risable exposure on the agri front in Maharashtra, then you know, there is an ongoing stress which is there in MSME, I'm sure part of that VCL is possibly would have taken some part of that stress out, but still do you see some asset quality issues on the go and because of which you made some additional provisions during the quarter, what is your broader sense on the asset quality outlook particularly in MSME and the agri sector?

See, one good thing is that as far as agriculture is concerned, in our bank, it is totally spread out, banned. And because of the e-Andra Bank and e-Corporation Bank, we also have a good sort of an exposure in Andhra Pradesh and Telangana and Karnataka, and certainly for Union Bank in Bihar and UP and MP and those states, which are more of an agriculture-driven. So, I think, you know, Maharashtra, we did not actually felt any impact up till now, but yes, the date is fixed and finalized and the data is submitted, so I think it is going to give a positive sort of a, you know, because whatsoever we wanted to, we have already done, it is provided for, so it will give a positive impact going forward when it is, you know, being reimbursed. So, on agriculture front, here in this case, we are not worried.

Thank you.

Can you answer on MSME front?

Anand, I request you to join.

MSME, I briefed, MSME, I briefed, I think two lengthy discussions that we have carried out, 140 MSME, customer needs span in India, and it is a very big report, huge report, an actual report. So, it has really given a very good insight. And we are dealing with now, actually, many banks, you will see that generally, and like, you know, the paracetamol given to every patient. But then we have discussed, we have done this exercise for two months, and our chief economist herself has sat with GM MSME. So we are giving wherever ad hoc is required, wherever RBI, relief major is required. So, we are actually deploying this course of action and we are monitoring centrally. So, MSME also, we have not seen anything negative up till now. Let us see going forward.

Thank you. Next question is from the line of Jay Mundra from ICSA Securities. Please go ahead. Jay, your line is unmuted. Please go ahead with your question.

Yeah. Hi. Good afternoon, sir. Thanks for the opportunity. Sir, I wanted to check on the overall growth, right? So, how do you see overall growth panning out and within which, you know, corporate do we still maintain the policy of zero IBPC or, you know, you see a bit of an opportunistic opportunity there? So, overall growth and within which corporate?

So, certainly, the industry whatsoever is growing, plus 1% is minimum what we are thinking, and we'll grow with that, and we are in that line. Already, corporate book, we have 1 lakh crore plus disperse, sorry, sanction not yet dispersed, and stages it has been happening. And so that is not an issue. We told, you know, 58 and 42 levels. So we are at, domestically, I'm talking, 57 to 43 levels, and we'll continue with that. IBPC, we do not want to even hear it. So there is no question of going for an IBPC. Zero, zero for that. And we are self-sustained. Let me tell you that I think last eight, nine months, we would have underwritten more than 70,000 crores.

No sir, we are not thinking of buying it, we are selling it. That is what I wanted to add and that is what has been done in the first quarter.

No sir, the industry is now growing at 18-19%, right? So we are currently at 13-14%. So, that would mean that you will become, you will, you aim to grow faster, 100 basis points higher than industry, right? Did I understand correctly?

So, certainly in the entire figure group, if you take, we would like to grow with the industry, what's ever going, plus one.

Sure, that is very helpful, sir. And secondly, sir, on ECL, you have given the estimate. I also wanted to check, sir, what is your all-inclusive, all-ticket size, bank-level, SMA 0, 1, and 2 numbers in rupees crore? Yeah, sir.

So, it is given in the above 5 crores, we have already given, I think, 2,833 or some amount, which is the lowest as of now in our bank. And even if it is lower than the 31st of March figures, and we have given both SMS 0, 1 and 2.

I was checking at the bank level number, including below 5 crore loans also.

Okay, thank you.

Thank you.

Next question is from the line of Antariksha Banerjee from ICIC Prudential AMC. Please go ahead.

Yeah, I'm sorry. I'm audible, right?

Your volume is very low.

Yeah, just two things to clarify. One is this income tax refund that you have booked above 532 crores this quarter. Can you give us the quantum that you had in last quarter and Q1 of last year as well?

It was 562 crore in the June

4th of March 26th, and you asked about June 25th, it was 14 crore already.

June 25th, 14 crore. March 26th, 562 crore. This quarter, it is 532 crore.

Yeah, but one thing like June 24th... June 25, we had treasury income of 1,439 crores, which has actually come down to last two quarters, which has come to 636-641.

And the second point I wanted to ask is on PSLC, so this 217 crores of PSLC fee income that we have booked this quarter, how does the outlook look for the rest of the year? Do you think you'll be able to make that 800-900 crores for the full year, or this is going to be the lumpy quarter?

Depending upon, you know, how we grow in the agriculture and particularly SMF, because SMF is more lucrative than, you know, any other portfolio. Yes, absolutely. So there are not many givers on that. So actually we are planning on that. We already have implemented certain things. We are waiting for offshoot. So, we will see as we go ahead doing quarter. Because, you know, initially itself booking good numbers is also, I think, a positive approach we have taken.

So, is SMF most likely linked to gold loans, agri-gold loans, and therefore it is dependent on where gold price moves, or is that not the case?

No, no, no. Actually, gold loan portfolio, because we want to be very compliant. So, we have done lot many changes in our portfolio. And if you see the gold loan portfolio, March and this time, actually there is a degrowth of around 2,500 to 3,000 crores. So, that is not. Actually, with real, you know, our growth in SMF and other parameters, we are going with that only.

Correct. Thank you.

Atriksha, I request you to join back the queue, please. Thank you. Next question is from the line of Param Subramanian from Investec. Please go ahead.

Yeah, hi, sir. Thanks for the opportunity and congrats on the quarter. Sir, a question on the NIM. I think you mentioned that the NIM will improve from here. Firstly, I wanted to understand why did the yield on advances decline in this quarter because I thought the rate cut transmission had happened. And secondly, what is the driver for NIM to expand further from here? Will it mainly be funding cost declines?

Yeah, see, actually, I think next time from you, taking from you, it is actually domestic, our mean is 8.01. I think, and the global mean is 7.90. So, I think, sorry, yield on advances. So, I think that is where you are coming from. So, domestic, actually, we are, you know, working in a fashion which we have told that many of our portfolios, which was lower yielding, we have converted to higher yielding. So, that's the reason we are actually thinking to improve upon the domestic means. Foreign branches, as you know, more are syndicated and the downselling is there and certainly roofer plus, it varies from sometimes 100 to 130, 140 levels. So, there does not have come much. So, yield on advances going forward, certainly we think that. And we said, because we were taking so many measures, because we need to speak. Thank you.

So this 8.01, what was it last quarter, domestic yield?

That will provide. Will, will, on that.

Sure, sir, if you could get back on that. Secondly, sir, very short question. Your AFS reserve from minus 800 crore, I think, as of last quarter, where is it now, broadly?

It is at around $3.45, so reduction of around $4.38.

It is minus $3.45, yes.

Thank you. Param, I request you to join me with the QP. Thank you. We'll take our next question from the line of Nitin Agarwal from Motila Loswal. Please go ahead. I'm sorry, Nitin, your audio is not clear.

Yeah, hi. Am I audible? Yes. Yeah, hi. Thanks for the opportunity. So, first question is on the LCR ratio. There is a good improvement that we have seen this quarter. So, is it possible for you to quantify how much of this benefit came from the new guidelines?

Yeah, if I remember correctly, there were three major things. One is through the Internet. And means on the saving bank and all. I think you made it. So there was some benefit of, I think, seven to five thousand crores around some benefit, I remember. Because last time there was a question on this which we answered. You are having right now? Ah, please tell, please tell. Thank you. 3% around was, and if I recall correctly, in the figure amount terms, it was around 4,500, we will give you exact figure, because there were three pillars, which impacted, one pillar was negative, two pillar was positive, and the net was positive to us, and there it also helped somewhere. Society trust was one issue, society trust, and another one was... Air cut on the investment. Decrease in runoff factor. So if you have got it, you please tell them.

You tell, tell. On society trust, AOPs, there was a reduction from 100% runoff to 40% runoff. So next it was around 4,000, 5,000, 2.5 to 3%. That was the next.

Basically, we got 2.5 to 3% of the net gain from that. Got it, got it, sir.

Thanks for that. And the second question is on credit deposit ratio. Over last one year, we have seen a 700 business point or increase in credit deposit ratio. While you are guiding for a higher than the system growth, how do you watch out for this number? What is a comfortable range that you will want to operate at?

See, it was around March 74 levels, which is around 85-86 levels now. So, it is almost 10 to 11 basis point. It has increased. Percentage basis, it has increased. So, I think this is not, it is a good, comfortable range. You will not go much beyond that. And that is why we said we wanted to build efficiency. We have tried, and I think we are successful in that. And then going forward, our aim is to build the deposit. First is the internal from the CASA and retail, and secondly from the bulk. But at the same time, to contain cost as we have done this time, 18 basis points we could reduce this time, and to improve the name. So this is the three triangles, I think, which we are working upon.

Thank you.

Ladies and gentlemen, we'll take that as the last question for today. I now hand the conference back to management for closing comments. Over to you, sir.

So, I think, first of all, I am grateful and thankful to all the analysts, all the... People in the enlist call and your quarries. Actually, your quarries gives us some color, you know, to improve upon. You may not say directly, but then asking on that. And that is where we write it down and we work upon that. And I always, in any of the last, I think, six years, I always... Ask the analyst to give us their feedback so that where we have to improve, where we can. So I think everywhere we like, you know, if we see the growth in Q4 also, we were at around 7%. So if we take analysis, it is really huge. And even now, when we have said that we have underwritten 60 to 70,000 crores, and we are downselling it, so we are comfortable and we are total having more than 1,000 crores off. So the credit growth, we are not bothered anyway. The deposit, yes, we are bothered only on the retail and casa, because we do not want to go down from here. We want to sustain the CASA growth whatsoever we have achieved. 2% is not an easy thing for within 9 months to 1 year, and the retail income deposit has given average figures also. So, 41,000 crore average we have increased from March 31 to June 30. I think these are the positive signs. And certainly going forward, as I said to one of the analysts, that the triangle is that we want to improve him. The second is we want to reduce cost of our funds. And the third is that whatsoever deposit is required or the resources is required, it continues. But certainly, while maintaining CD ratio in the acceptable range, and LCR in the acceptable or comfortable range, that is 121, it is quite good, and LSFAR. So the five pillars on which I started, profitability, and efficiency first, robustness, quality and sustainable growth, profitability, and customer sensitivity and EODB for staff. Equally given advantage by the board of the bank. in front of you and the entire senior management sitting in front of you. With these words, we are thankful to you for having not only trust but belief in Union Bank that what we say we come out with that and we want to strengthen, make the bank more robust. So that if any hiccups come because of any external shocks, we are in a position to sail through very nicely and very quietly. With this, thanks to all of you for joining this Investor Call. And any quarry, you are, please feel free to mail up, and whatsoever we have told to give you the figures, we will be giving you after this meeting.

Thank you, members of the management team. On behalf of Union Bank of India, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.