ICICI Bank Ltd (IBN) 2009 Q3 法說會逐字稿

Good evening ladies and gentlemen. I am Santosh Shastri, the moderator for this call. Welcome to the ICICI Bank conference call. This call is for the duration of one hour. For the duration of the presentation all participants' lines will be in the listen only mode. I will be standing by for the question and answer session.

Ms. Chanda Kochhar will be on the call for the first half an hour. I would now like to hand over to Ms. Chanda Kochhar of ICICI Bank. Thank you and over to you, ma'am.

Thank you.

I would like to remind everybody that today's discussion could include our views on future trends based on what we know in today's uncertain and changing conditions. Our press release and our annual reports in India and the US have more information about risk factors that could affect the future.

Good afternoon to everybody. Should I just start with a brief snapshot?

Well, our profit after tax for the quarter has been INR1,272 crores which is a 25% increase over the second quarter. And it's also a healthy increase on a quarter on quarter basis.

In fact if you look at the operating profit, it's a 23% increase over operating profit for Q3 of 2008. This has come on the back of a net interest income increase which was INR1,990 crores. Basically we have maintained our net interest margins at 2.4%. And we have earned a healthy treasury income of INR976 crores.

And there has been a tight control on operating expenses. The operating expenses have decreased 19% to INR1,680 crores.

These are the very broad highlights of the performance and we'll be happy to take questions from you. As it was mentioned, I'm here for the first half an hour but Rakesh Jha and the team is going to be present here for the full one hour.

We can start the question and answer please.

Thank you ma'am. We will now begin the Q&A interactive session. (Operator Instructions).

First in line we have Mr. Mahrukh. You may go ahead, sir.

Hi everyone. I just wanted to check on a few things.

Firstly, on the fee income, Q3 that's a year on year growth. Also on the net NPL couldn't the provision have been higher given the treasury gains? Couldn't have that been a lower number since the gross NPLs have declined quarter on quarter?

And just some guidance on insurance, as in how do you see the competitive landscape? When do you see growth picking up and any guidance on margins, if there is any?

Yes, on the fee income, of course the fee income for this quarter is INR1,347 crores. As you are aware our fee income is broken into retail and corporate. And the corporate fee income really moves with the amount of economic activity in the corporate sector.

So during this quarter there has been a pause in the new projects that the corporates are taking. And also there have hardly been any M&A transactions. So a large part of the fee income is really the ongoing transaction banking income but not really related to any M&A or project finance.

On the retail side, while other fee incomes like the transaction banking income and the credit card transactions etc. have continued to grow, but the two types of fee income that have slowed down a little bit is one, the income relating to retail lending, which is about 20% of our retail fee income. And the second is the one related to distribution of third party products, that's mutual funds and insurance, given the slowdown in the activity in those segments as well.

And from here I'll come to actually your fourth question, that is insurance. Of course the insurance business as a whole grew by about 4% this year for the industry as a whole for these eight months. Within that, the private sector business has grown by about 27%.

And if you see our performance actually it's been more or less in line with the industry because our total premium growth is 28% within which the renewal premium has grown substantially. That's grown 75%. So that shows that even in a market like this where the growth rates in new premium business are slower, the companies that have higher persistency ratio will always gain. And that's clearly shown in our performance because our renewal premiums have grown by 75%.

But during this period what the Company has done is clearly again tightened their expenses substantially. And the margin has therefore, in spite of the slower growth, been maintained at 18.9%.

And I'll get Rakesh to answer the question on provisioning.

In terms of provisioning Mahrukh, the provisioning has been done exactly as per the policy that we were doing till September 30. So based on that, the provisioning has been done. It's not really linked to that the treasury income was higher or lower.

In terms of the total gross NPL and the net NPL number, the one change which you should note is that from the current quarter, as is the practice with other banks, we have also started writing off loans on the retail side. So that has impacted the gross NPL for the current quarter when you compare it to the previous quarter.

And the total write offs that we would have done during the current quarter for such loans that have been overdue for a long time would be about INR16b.

Thank you so much. Next on line we have Mr. Prashant from ICICI Prudential. Please go ahead, sir.

Hello. Just one question on the rural advances. This seems to have declined quarter on quarter significantly. Maybe you can just comment on that please?

Generally the agriculture and rural advances are of shorter duration. So they peak in the last quarter every year and then they get paid off by the second quarter or so. And then they again build up in the last quarter. So that would normally be a trend every year.

Thank you. Next on line we have Mr. [Atik] from ICICI. Over to you sir.

Hello.

Yes.

Hi ma'am. This is Pathik. I'm from IDFC SSIF.

Yes, I was wondering.

I just wanted to clarify.

I just had one question. I think the gross NPL number that you've written off in this quarter as Rakesh was saying, has there been a change in reclassification in what you had done in the previous quarter as well? I mean is the September 30 NPL the same as what you declared as on September 30?

Yes.

Isn't there some slight -- is it exactly that? Because (inaudible) a lower number. Was it the same or has there been a reclassification here?

It has been the same number.

Okay. And so there's no write off in that number?

No.

The write off has been in the sum of -- you've written off INR16b in this quarter. Okay. That's first one.

And second is anything about CASA? I think I have missed it if it's in the presentation. I don't see it.

No, the CASA percentage has clearly dropped. It's 24 -- 27% now for us.

27%?

Yes.

From -- it was 29% in September.

Yes.

In absolute terms have the savings deposits dropped or have they grown?

They have declined during the current quarter. So if you look at the savings deposits at December 31 it's about INR38,600 crores.

Right.

And the current account deposits are about INR19,000 crores.

That's the current -- those are the current numbers.

Yes, as at December 31.

INR38,000 crores and INR19,000 crores. Okay, thanks.

Next on line we have Mr. Kamlesh from Asian Markets.

Hello.

Yes.

Madam, I just wanted to understand what would be the -- two things. What is the business model? Because I suppose you are substantially shifting away from the direct marketing agent route as it's shown also in your expenses getting declined subsequently on that. So how would be the incremental growth would be coming at all? And what do you see as the trend over the next two to three quarters in terms of deposits and credit side?

See our business model going forward is going to be essentially what we have followed in the last few quarters. That is we are really looking at preserving capital and managing risk and therefore our growth has been very, very moderated.

That's right.

And we believe that the economic scenario even currently is such that we would follow this model at least for some time.

I think the real pick up in growth would happen when interest rates systemically correct substantially. That is when credit can really become affordable and serviceable by customers.

So until then we are happy to moderate our growth ambitions. And during that period we are actually using this as an opportunity to in fact pay off high cost wholesale deposits.

Okay.

So if you see the wholesale deposit number that's actually a number that we could have increased. It's really more rate sensitive. We could have increased those deposits if we really wanted. But we have consciously kept them low because we want to really bring down our cost of funds.

Right, okay. But again madam, in that case what would be your take on the interest rate scenario going forward? What will you see in moderation happening in that front to ease the liquidity in the system?

The liquidity is currently actually quite comfortable in the system. But interest rates would come down. I think over a three to six month period interest rates should correct substantially. We have seen the movement happening with a lag. First we saw inflation correcting, then we saw the G-Sec yields correcting.

That's right.

Of course there's some aberration currently in the G-Sec yields. But otherwise last quarter we saw them correcting substantially. Now we saw -- we've seen impact in the wholesale deposit rates now, about a 2% correction. The retail deposit rates for most banks have corrected only in the last fortnight or so.

So I think one would watch that for some time. And that gradually should start having an impact on the effective cost of funds for the various banks as a whole, after which lending rates will correct.

Right. And lastly, ma'am, can you help me just to understand which pocket of the credit is having the biggest hit in terms of the growth and in terms of outlook from here on?

No, I think we are adopting a cautious approach across all the businesses. So if you see, our growth is moderated across all businesses. The view that we are taking is that we have to watch for some time more about what's happening to the economic scenario and therefore take smaller steps currently.

Thank you. Next on line we have Mr. Rajeev from Merrill Lynch. Over to you, sir.

Chanda, hi, this is Rajeev. Hi Rakesh.

I just wanted to understand what's the trend then you're seeing in the asset quality. Is it still coming largely from retail or are you starting to see some stresses in the SME portfolio on the corporate side?

And secondly, on the overseas book if you could just give some more granularity Rakesh on the -- is there any NPL hit or anything on that book?

In terms of trend, we are still not seeing a pressure on the corporate side actually. So while we are moving cautiously in new approvals, that's because the projects would take time to get financial closures and so on and so forth. But in terms of provisioning, we have not yet seen any pressure on account of the corporate side. It's essentially the retail portfolio which is experiencing the regular rate of losses.

On the breakdown on the international side, Rakesh do you want to do it?

On the UK portfolio in terms of the mark to market, because of the widening of the credit spread there has been some increase in the mark to market on that portfolio.

Also as we have disclosed that we have transferred a part of our investments on the trading portfolio to the banking book which has resulted in a write back of $25m of mark to market losses that we would have taken in the September quarter because this was done as per the new accounting standards that were introduced in the UK in October.

After taking that into consideration, the impact on the P&L for the current quarter is about $5m. If you don't adjust for the write backs the total would be about $30m of mark to market that is there in the P&L for the quarter. And on the banking book the mark to market has increased by about $70m for the quarter.

Okay, thanks a lot.

Thank you, sir. Next on line we have Mr. Seshadri from Macquarie. Over to you, sir.

Hi everyone. Just one question on the treasury profits. Was there any element of further equity book markdown in that?

And secondly, what sort of outlook is there? What is, A, your view on interest on bond deals going forward? And B, what is the cushion rate beyond which you may have to make provisions on your bond book as well?

On the bonds in general I expect a correction to take place. I think this reversal in the rate that has happened in the first 10, 15 days of January is probably a reaction to the government borrowing program that was announced unexpectedly. But I think gradually over the next two months correction would take place and we should see the bond yield going below what they were on December 31.

Rakesh, specifically on the equity side do you want to say anything?

On the equity side there were some mark to market realized losses during the current quarter. But as you said, most of the treasury income today in the current quarter is coming from the fixed income side.

Thank you.

Thank you, sir. Next in line we have Mr. Dipankar from Deutsche Bank.

Yes hi. Two clarifications. Can you hear me?

Yes.

Two clarifications on asset quality. Firstly, if I were to notionally add back the INR16b that was written off, then in that case the new formation during this quarter appears to be about INR10b. Is that the right way of looking at things?

It would -- Dipankar it would be approximately about INR12b, after taking into account the sale that we were doing to ARCIL in the current quarter.

Okay, so it's INR12b.

And the second question is if you could clarify whether -- the status of Ratnagiri Gas and Power, is it still a standard asset?

It is a standard restructured asset in the books of the bank.

Standard restructured. Okay. Thanks, that's it.

Thank you sir. Next on the line we have Mr. Agarwal from ABN Amro. Over to you, sir.

Good evening. Just one small question. On your investments book in the AFS have you significantly changed the duration and if we could have the duration as of September and December?

We have significantly changed the duration. I don't whether we gave out the duration every time. But yes, we have changed the duration.

Thanks a lot.

Thank you, sir. Next on line we have Ajinkya from Motilal Oswal.

Good evening, a couple of questions. One on the margins reported at 2.4%, I just want to understand our net interest income is down about 7% quarter on quarter while maybe earnings assets are down by just 3%. So how the margin stability then quarter on quarter comes?

In terms of -- it is based on the average book in the current quarter vis-a-vis the last quarter. So there would be some impact of that. It'll just be on a rounding basis. So broadly the margin is at the same level as previous quarter.

Okay. And second, a couple of data points. Could you give the consolidated loan book as you report every time?

The total loan book at December 31 is 2 lakhs 58,000 crores.

Okay. Versus last year?

Last year December '07 is 2 lakhs 37,000 crores.

Okay. And investment in subsidiaries has gone up by INR1,000 crores. It is into Life or anything else?

It is -- a large part of that is in ICICI Bank Canada which has seen asset growth in the current quarter and about INR1.5b in ICICI Life.

Okay. And the housing loan company's loan book?

That is about INR11,000 crores.

Okay, thanks.

Thank you, sir. Next on line we have Mr. Sunil Kumar from Birla Sun Life. Over to you.

Hi. I just wanted to check on the deposit side. Has the situation improved on the deposit side since we have sequential drop in deposits? And along with it advances sequentially there is a drop. But can we start seeing some growth from here on?

As far as advances is concerned, as I said for some time, we'll continue to follow the current strategy itself. So while there is, in that sense there are new loans still being written but we also have repayments coming from the bank portfolio. So that's how you see an impact on the total book. But we have clearly tightened our credit parameters and we'll live right now within those tight credit parameters.

On the deposit side, when we break up the number between October, November and December, one clearly sees an increase in the month of December compared to October and November.

Okay, thank you.

Thank you, sir. Next on line we have Ms. Tabassum from UBS Securities. Over to you, ma'am.

Yes, hi. Just on your NPLs, basically you've been adding about INR12b every quarter. Given that you have gone very, very slow on the retail loan growth when do you think this number will peak and when do we actually start seeing a reduction in the NPLs? That's my first question.

Okay. Since it's a forward looking statement I can get Rakesh to answer. Rakesh.

No, Tabassum the outlook remains the same as we have discussed earlier in terms of the NPLs. Back in September when we have spoken about it we have said that over the next couple of quarters the current trend would continue and thereafter we should see some easing in terms of addition to NPLs.

As you know, in October things had got impacted in the economy. So we did see a slightly higher trend in terms of the retail NPL additions in that month. And in terms of peaking as I said, the earlier [trend] continues. Maybe seeing it a slightly higher level than what you would have thought earlier.

Okay. Then on overseas operations if you can just basically -- how do you see that now given the economic environment which we are seeing overseas? Are you looking at expanding in Canada still? And also on the UK operation, how is that in terms of the total assets and in terms of liquidity? And are you actually lending in the UK and the Canada operation at this stage?

In UK and Canada we are seeing accretion of deposits for sure. In fact we have actually seen very healthy accretion of deposits because new customers are getting added. Customers are actually willing to place deposits with us. So on an average, about $500m each per quarter both in UK and Canada is the accretion that we are seeing.

So that is actually one thing that has lent to sufficient liquidity for us in both those operations. In both those places we have liquidity of more -- on an aggregate about $2b. We are living with very healthy liquidity. We are also living with very healthy capital adequacy ratio in both those places.

But yes, some incremental lending we are doing, essentially India led. Mainly just to the extent we can out of this deposit flow. Not really borrowing otherwise any other longer term money or borrowing from the market. And therefore, we are not really doing much lending from our branches because there we don't have access to retail deposit flows so we are keeping the book at constant levels there.

So even in the UK you are now seeing deposit accretion? Because if I remember well, the last quarter it was almost flattish.

Yes, but this quarter we've seen healthy accretion actually.

Okay.

Yes, but let me clarify. What we have done this quarter is that we have concentrated only on term deposits and we are consciously giving off the -- what you call CASA over there because that is the deposit that we are not able to -- the CASA money we are not able to use for lending as per the FSA guidelines.

So we are consciously letting go of the CASA kind of deposits and we are concentrating now in fact on the term deposit. And on the term deposit side we've seen a healthy increase.

So should we see margin improvement in the overseas book?

No, this won't lead to an improvement in margins.

Okay. Because the term deposit rates would be higher.

Yes. So actually it won't lead to an improvement in margins.

Despite the fact that you would be lending it?

Yes. But still because the cost of the term deposits is higher than the CASA deposits.

Okay. Just one small last question. In the domestic book clearly because of the problem you faced this last quarter, have you seen a significant jump in the overall proportion of your wholesale deposits because retail deposits had reduced?

No, we haven't. Because we have in fact also consciously paid back the wholesale deposits.

So was the reduction which we see in deposits of 9% is it primarily because of wholesale deposits going down?

No it's spread across. Part of it is CASA, part of it is retail term deposits and part of it is wholesale deposits. But it's not something that has dramatically changed the proportion of wholesale or retail.

Why is your borrowings increasing so much quarter on quarter? Because wouldn't it be better to maybe take deposits rather than borrowing because it seems like overseas borrowing is not really what is driving this up?

Tabassum, part of it will be just because as of that balance sheet date. So one increase is because of some Tier II bond issuance that we have done in the current quarter.

Yes.

And balance will be, for example, if I have a call borrowing outstanding on December 31, it will show up in that line. So that's the only reason why the borrowings are appearing to be higher than September 30. Otherwise we don't really need to resort to any borrowings.

Okay. Thank you.

Thank you ma'am. Participants are requested to ask --

Okay. I'll take the last question, after which I will leave. Yes?

All right. The last question comes from Mr. Aditya from Citi. Over to you sir.

Hi. I have just one question and that's on restructured assets. If there was any restructuring this quarter, what would be the numbers in terms of accounts and value?

The total restructuring assets is about INR50b. And in the current quarter we would have restructured a few accounts amounting to less than INR2b.

Thanks.

Sir, would you like to take the next question?

Yes.

All right. Our next question comes from Ms. Soumya Agarwal from HSBC Securities. Over to you.

Yes hi. Two questions from my side. Firstly, if you could tell me what's the outstanding credit derivatives portfolio as on December? I think it was some $1.4b at the end of September. So that is one thing.

And secondly, how has your cost of funds moved this quarter?

On the credit derivatives the position has not changed since September 30, so outstanding remains at the same level. And all of it, as we had said earlier, is where we've given protection against underlying Indian entities.

On the cost of funding in the current quarter, it has gone up compared to the previous quarter, that's September quarter, by about 40 basis points, around 6.8% to 7.2%, within which the cost of deposits has also gone up by about 40 basis points to 7.4% in the December quarter.

Okay, thanks.

Thank you ma'am. Next on line we have Ms. [Murthy] from Fidelity. Over to you.

My questions are answered. Thank you.

Thank you ma'am. Our next question is from Mr. Krishnan from Ambit Capital. Over to you sir.

Hello. I just had two questions here. I guess the break up of the CASA, number one. And secondly, the provisioning. We have seen a decline in absolute NPLs at the gross level. However, the net NPLs we have still not done much on the provisioning front. Is there some reason why we have reduced the provisioning coverage there?

On the CASA the break up is that the savings deposits are INR386b.

Okay.

And current account deposits are about INR190b.

Okay.

One the NPLs, as I explained earlier, in the current quarter we have written off about INR16b of loans -- of NPLs. And because of that you would have been seeing that the gross NPL has declined while the net has increased.

In terms of provisioning there is no change in terms of the policy that we had until September 30. So that all remains at the same level.

Fine. Yes, I guess I'm done. Thanks.

Thank you sir. Next on line we have Ms. [Lakshmi] from ICICI. Over to you. Ms. Lakshmi, you may go ahead and ask your question. Next on line we have Mr. Hiren.

Hello?

Mr. Hiren, you can go ahead with your question.

Yes. Hi Rakesh. Hiren here from Goldman.

Yes. Hi Hiren.

Hi. Firstly, provisioning is that entirely on the credit related provisioning only, or is there some mark to market reversal as well there?

Hiren, as we have said that the [depreciation on] investment is a mark to market that we have reflected always in the treasury income line. So that is why for example we had -- that is a part of the reason for the treasury losses in the first half of the year.

Yes.

So provisioning will not really have any mark to market reversals in that line. The provisioning is largely on the NPLs. Almost all of it will be for non-performing loans in the current quarter as the general provisioning norms have changed.

Despite the decline in our level of advances, as per the RBI guidelines, we cannot write back the general provisions. Although, as per the revised guidelines which are now there in terms of 0.4% and all that, the requirement will be significantly lower for the Bank.

I was a little curious when you said INR16b of write-offs, whereas the P&L charge is only INR10b roughly.

Hiren, that INR16b means that these are non-performing loans which have already been fully provided --

Provided for.

So there is no impact on the P&L of this write-off. It is only the gross NPL that gets written off. There is no impact on the P&L.

Okay. And secondly on the overseas subsidiaries, can you give some sense of where the lending is happening? I mean 33% of UK is now loans and 55% of Canada is loans. So are these also India related or these are non-India related?

In the current quarter in terms of -- on an incremental basis in UK the loan book has not really increased that much. In Canada we have seen a growth on the loan book.

No, I am saying on the outstanding basis, is it all related to the India or --

No, on the India and non-India, that broadly remains the same. As we have said earlier that if you look at our overseas business, in terms of the overseas branches that we have, close to about 90% of that will be exposure to India or India related clients.

And in the case of subsidiaries it will be about close to 80%. And that 80% excludes -- you know in Canada we have about $1.6m of exposure to mortgages which are federally insured. If you leave that aside, it's about 80% will be to India.

And the retail deposits which you're getting in both these countries, also fall -- also are part of the federally insured deposits there?

In UK and Canada both we -- in both geographies ICICI Bank deposits enjoy the benefit of insurance.

Okay. And just on the MTM side for -- you said $25m is lower in ICICI UK in P&L because of the shift from trading book to banking book. But this $25m would be part of the $71m which you have reported?

Yes.

Okay. And the MTM policies would be the same as for the other banks in those jurisdictions, right?

Yes.

Okay. Thanks a lot.

Thank you. Now we have Mr. Mahrukh from ICICI. Over to you sir. Mr. Mahrukh? Mr. Mahrukh you may go ahead with your question.

I'm sorry we have lost him. Next we have -- next we have Mr. Anand? Hello?

Hello?

Mr. Anand you may go ahead with your question.

Hi. Yes, good evening Rakesh.

Hi Anand.

Yes. Can you reconcile the cumulative provisions for me, because you said you had INR59.7b outstanding in September? You've added provisions of perhaps up to INR10b during the quarter. And you've also had some write-offs. But how do you come to the INR51.75b by December?

The cumulative provision movement, I guess, will not reconcile just because of this because there will -- for example, if there are any settlements and all that that will also get reflected here. So it will not really be a direct reconciliation between the provision.

And [offline].

Also I'd like to understand why have savings deposits declined quarter on quarter? Is this because of a shift to term deposits, or is it because of a shift to other banks?

No. As Chandra mentioned earlier that in the months of October and the first two or three weeks of November we clearly did see much lower accretion to our deposits, the retail deposits, especially the savings deposits. So that was the primary reason for the decline that we saw. And from December onwards we have seen normal accretion onto the deposits.

So one is, what was unique to ICICI Bank in terms of these unfortunate rumors that were there on the Bank. In general for the banking system as well the CASA deposits did decline in the current quarter, which was more because of shift of savings deposits to the term deposits.

But on -- what was the total retail deposits that was outstanding in September? And how much was it in December, on December 31?

We don't really disclose specific retail and wholesale deposits. We have given the savings deposits which largely reflects the retail deposits.

In Insurance have you actually made assumption changes this year when you've reported your 18.9% margin, or is it still based on the previous assumptions?

It is based on the previous assumptions only.

So you wouldn't have benefited from the lower expenses yet in your margins?

No. See Anand, in any case the assumption on the expenses would even earlier, say a year back, would have been based on what in the long term or in the steady state we would achieve.

Right.

So that would anyway -- won't impact it.

Finally can you give the numbers on new business premiums on an APE basis? How much was it in Q3 and how much was it year to date? And can you give me the number for '08?

On the APE basis the Q3 number was about INR10b. And that was about INR16.7b in Q3 of last year. And in the nine months it's about INR37.6b which was about INR38.8b in the last nine months.

Thanks.

Thank you sir. Next on line we have Mr. Pankaj Chopra from ICICI. Over to you Mr. Pankaj.

Hi. I am from Shanti Asset Management. Hello?

Yes hi.

Two questions. One is post -- there seems to be a shift on strategy, shifting from retail starting last quarter. Do we maintain that? And what is going to be the focus area for asset lending going ahead? And I'm sure the consolidation is what's targeted. But essentially over the long term, three to four years, no shift in the mix on the asset side?

In terms of the shift on the retail side, that has been there for the last six or seven quarters, that we have seen a much lower growth on the retail lending side. And the decline has been, as you rightly said, more sharper in the last couple of quarters.

As again we have said recently that in the current environment we would really not like to be aggressive on the lending, be it either retail or corporate. So the growth that you see going forward will continue to be very calibrated. And it will also be linked to the extent that we grow our retail deposits and CASA deposits. So that is the overall thought which is there in terms of the current environment.

As to lending, I think we have about 55% of lending to the retail -- as a retail portfolio. Do you see that as steady state or do you think that will come down?

If we look at it over, say, the next 12 or 18 months, I would expect that to come down from the current level. And that has been -- it was about -- it was close to 65%, as I said, six or seven quarters back. And it has declined to about 55%. And I would see that declining a bit more in the next 12 or 18 months.

Thank you Mr. Pankaj. Next on line we have Mr. Anand.

Hello?

Anand, you may go ahead.

Hello?

Yes.

Rakesh?

Yes.

Rakesh I just wanted one clarification. I just wanted to know in probably in the international book or also in the domestic book on international loan, do we have loan against shares to any of the promoters?

We would have loans in our portfolio in the domestic and overseas book in terms of where the security would be shares. So we would have such loans.

And if you can share what could the quantum or what sort of cover do you have, do you carry in this market?

We don't -- because this would also be applicable not just for the loans given to promoters. Even in a number of acquisition transactions also shares are taken as a collateral. So there's no specific number that we've disclosed as per the portfolio which has shares as a security. What I can say is that this entire portfolio there are no payment defaults which have been there on this portfolio. And we have adequate coverage in this portfolio.

Fine. Rakesh just one more thing. You just mentioned in the housing finance subsidiary you had a loan outstanding of INR11,000 crores, right, which is a de-growth compared to Q2?

Yes.

Q2 it was INR12,000 crore, right?

It was slightly higher at that time. I think it was about INR500 crores higher.

Okay, fine. Thank you.

Thank you sir. Next on line we have Mr. Puneet.

Yes hi. Hi Rakesh. I have a question on this write-off of INR16b. If you can tell us what would have been the tax rebate on this?

Puneet, the only impact is that it would come as a current tax benefit instead of a deferred tax benefit. It will have a tax saving in terms of that. At the time of making the provision we would anyway have taken the benefit on the deferred tax basis.

Okay, okay. And how much was the general provisioning in Q3?

General provisioning it was zero. As I said, with the changed RBI guidelines --

Yes.

The requirements for us are significantly lower even than the current --

Yes. Everything was loan specific?

Yes.

Okay. And just one last question on this overseas, especially on the UK investment book. Has there been any change in the size, especially in light of the recent event in the European banking system?

The portfolio is broadly at the same level as it was at September 30. And the retail breakup of the UK asset book is given in the presentation as well.

Sure. The investment book size remains more or less same?

Yes. The only thing is that in terms of -- in dollar terms, because the currencies have changed, so you know the numbers may appear a bit lower on that.

Sure. Okay. Thanks a lot.

Next on line we have Mr. Ashwani Kumar.

Hi Rakesh.

Hi.

Hello?

Yes.

I've just got a couple of questions. Can I have the industry wise breakup of your loan book?

We don't put out the industry wise disclosure on a quarterly basis. So it would be available for March 31, which is the --

Okay. And what has been the incremental yield of advances?

Ashwani we don't specifically disclose incremental yield on the advances.

Okay. And is it possible for you to give the unrealized gain in your [SGM] book?

Somehow you're asking all questions which we don't -- that we don't really disclose on a quarterly basis.

Okay. That's all. Thank you.

Thank you sir. Next on line we have Mr. Vishal Goyal from Edelweiss. Over to you sir.

Hi Rakesh. Just two things. One on the securitized loans outstanding, what would be the outstanding loans which you would have securitized and still service?

I don't think -- I can give you an approximate number, about [INR170b], but I'll need to reconfirm that. I don't have that.

Okay. And the credit enhancement call, which is like first loss, where we do actually show this? Is it part of NIM or it's part of provision?

Sorry which one?

The FLDG? First loss.

First loss meaning at the time of securitization that --

No, no. When, for example, you would have given some FLDGs in case of securitization.

Right.

So whenever there are calls on FLDG, where do you really book it? Do you show it as part of the NIM or part of provisions?

It would be a part of the NIM.

Okay.

Meaning in the sense that in the securitization gains, or whatever is related to securitization --

Will fall in --

Has been shown in NIM earlier. So I guess it would be a part of NIM only.

Okay. And just one more thing, on international loans, again this is on the branches, which is basically part of [36%]. Where do the 90% in India [lead]? What proportion of this could be foreign business risk? Maybe corporate could be Indian, but you are taking a business risk outside India. Any rough number there?

I don't have a rough number on that item, but it will be -- for example it will be a material part of the portfolio because, as you know, we have financed Indian businesses who have gone abroad. So it will be an integral part of the portfolio as well.

Okay. And just last thing. On the branches, this 580 branches looks good. What could be the time frame when you'd want to open this?

In the current calendar year.

But maybe it's spread out over the year? Or you'd want to open it next three months, six months time? No?

Not in the next three months but you know -- in the next -- in the calendar year.

In the calendar year. Okay. Thanks.

Thank you sir. Next on line we have Rahul Jain from CLSA. Over to you Mr. Rahul. Mr. Rahul Jain you may go ahead with your question.

Am I audible?

Yes.

Could you just hold on for a second. My colleague Aashish is on line. He's -- Aashish come here. Can you give us the average duration of your term deposits?

Average duration of term deposits?

Yes. You might have borrowed during this quarter when there were some liquidity issues. Just want to get a sense of whether long duration term loans were taken up, or has it changed significantly in the last three to six months?

Interest terms, a very large amount that we gave out. But typically the term deposits are -- the maturity is in the region of six months to one year with the retail deposits being more of one year maturity and wholesale deposits being maybe about nine months or 10 months on an average maturity.

Thanks a lot. That answers my question. Thanks a lot.

Thank you Mr. Rahul. Next on line we have Mr. Pankaj from ICICI. Mr. Pankaj? Mr. Pankaj you may ask your question. Sorry next on line we have Ms. [Rathi], from ICICI.

Hello?

Hello, Ms Rathi?

Actually I'm from Gupta Equities. Rathi [Pandit]. All my queries have been answered. Thanks.

Thank you ma'am. Next on line we have Mr. Manish from Kotak Securities. Mr. Manish.

Hi Rakesh. Just wanted to know the breakup of fee income for the third quarter in percentages terms, if you can share?

On the fee income, roughly retail would have been about 50% and the balance would have been corporate and overseas increase.

Okay. And has that been changed compared to the previous two quarters?

It has changed because, as Chandra again mentioned earlier, that given the lack of activity on the corporate side, the opportunities on the fee income on the corporate side has been impacted more than the retail side, where only the retail lending fees and the third-party distribution has been impacted, while the credit card fees, the SME linked fees and the normal retail banking fees have continued.

Okay. And on the corporate side would it be -- can you just share what would be the lending related fees that we would be getting. If we can have some percentages out there?

Broadly this is the breakup that we gave.

Okay. And on the term deposits, how much is the wholesale deposit proportion now?

That would -- if you look at the -- it would be about two-thirds to 70% of the term deposits.

Okay. Thanks.

Next on line we have Mr. Krishnan from Ambit Capital.

No, I guess most of the questions have been answered. But thanks.

I think we are done with the questions. So I would like to thank all of you for attending the call. Thanks and bye.

Thank you sir. Ladies and gentlemen, thank you for your participation. You may now disconnect your lines. Thank you and have a nice evening.