Central Bank of India conducted a conference call on 19 January 2024 to discuss its financial results for the quarter ended December 2023. MV Rao, MD and CEO of the bank addressed the call:

Highlights:

The bank has recorded business growth of 11.49% end December 2023 against the target of 10 to 12%. The deposit growth was at 9.53% against the guidance of 8 to 9%. The loan growth was at 14.7% against the guidance of 14 to 15%.

The CASA deposit ratio of the bank remained strong at 49%.

The share of retail, agriculture and MSME (RAM) loan book was strong at 67%.

The net interest margin was within the guided range at 3.8%.

The bank has reduced GNPA ratio to 4.5% and net ratio to 1.27% end December 2023.

The provision coverage ratio was healthy at 93.7%.

The fresh slippages ratio stood at 0.34% in Q3FY2024.

The credit cost was higher at 1.26% most of which was on account of proactive provisioning.

The ROA was at 0.69% in Q3FY2024.

The cost to Income ratio was at 57.9% in Q3FY2024.

The bank has continued to record net profit for the 11th strength quarter. The net profit for 9MFY24 at Rs 1741 crore is higher than Rs 1582 crore in FY2023.

The liquidity coverage ratio was robust at 231% as the bank continues to have low credit risk weight ratio of 63.26%.

The employee provisions where higher at Rs 1664 crore on account of raising wage revision provision rate to 17% in Q3FY2024.

The co-lending book stood at Rs 9575 crore end December 2023.

The bank do not expect rate cut before September 2023, but the g-sec yields are expected to soften from Q1FY2025.

The bank expects to maintain its cost of funds steady with the strong CASA deposit ratio of 49%.

About 51% of the loan book of the bank is linked to RBLR and 31.9% to MCLR.

The bank expects to reduce net NPA ratio below 1% by March 2024, which will lead to further improvement in the provision coverage ratio to 94-95%.

With regard to the high government holding, the bank has submitted proposal for offer for sale and it is awaiting government response.

An increase in the restructured loan book was mainly on account of the disruptions in the Manipur state.