Where do you see the loan growth going ahead
We should look at our overall loan growth. We have always said that we would grow at a faster pace than the industry. If measures being taken by the government drive the GDP growth, then, clearly, the system growth will pick up too, and we expect better loan growth on our side as well.
In terms of our actual disbursements, there has been a pick-up in a couple of retail loan categories in the last quarter or so. If we look at actual disbursements on a sequential basis, there is a slight pickup in auto loans too. We are all looking forward to the economy reviving, and expect growth to come back in a while, but not immediately.
There have been reports of a merger between HDFC and HDFC Bank. Have any discussions taken place yet
There is certainly nothing right now. There has been a lot of speculation ever since the RBI released its new guidelines. However, at this point of time, there have been no talks. The reserve requirement issue was surely one of the major hurdles and whether this circular actually addresses this or not will require a certain amount of analysis.
With RBI asking banks to provide for unhedged foreign currency exposure of clients, where does HDFC Bank stand
The total provision on the unhedged forex and SMA-2 exposures stood at R40 crore in the quarter.
What are your views on the current pace of loan growth
At this point of time, we are quite comfortable with the loan growth. If at all, it is not as fast as that of disbursements, it is because we have some of our retail loans running off. If the pace of loan growth had slowed in terms of disbursements, it has now picked up again. In the meantime, there is a mismatch between loans running off from the earlier portfolio and what is coming in. But we have actually seen extremely strong disbursements on the corporate banking and wholesale sides, and the growth in the loan book itself, along with some other segments in retail.
Why were the Q1 provisions lower on a y-o-y basis despite the rise in bad assets y-o-y
Last year's provisions included a floating provision we had made, which is not being done this year.
Could you add some
colour to your capital-raising plans
We have not yet come to decide which structure and markets we will access. It is a function of various things, including the nod from FIPB, and there is no foregone conclusion on whether it would be only domestic or international. Depending on the approvals, we will figure it out, but it is not going to be any one market. I think it needs to be in some proportion. However, it is premature to speculate about which markets and what proportion.
Right now, we have got the shareholders approval and we need regulatory nods. Tier 1 is at 7.1% and if I look at the potential capital raising, it should improve somewhere between 2.5% and 3%.