Ladies and gentlemen, good day and welcome to SBI Q4 Meet hosted by State Bank of India. 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 by pressing star and zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Pawan Kedia, General Manager, Performance Planning and Review from State Bank of India. Thank you, and over to you, sir. Thank you. Good evening, ladies and gentlemen. I am Pawan Kedia, General Manager, Performance Planning and Review. On behalf of the top management of SBI, I extend a warm welcome to all joining us today on SBI Q4 FY 2021 earnings conference call. On the call today, we have with us our Chairman, Mr. Dinesh Kumar Khara; Mr. C.S. Setty, Managing Director, Retail and Digital Banking; Mr. Ashwani Bhatia, Managing Director, Corporate Banking and Global Markets; Mr. Swaminathan J, Managing Director, Risk, Compliance and Stressed Assets Resolution Group; Mr. Ashwini Tewari, Managing Director, International Banking, Technology and Subsidiaries; Mr. Alok Choudhary, Deputy Managing Director, Finance; and Mr. Charanjit Attra, Chief Financial Officer. Before I request our chairman to give a brief summary of the bank's Q4 FY 2021 performance and the strategic initiatives undertaken, I would like to read out the safe harbor statement. Certain statements in these slides are forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changing in circumstances. Actual outcome may differ materially from those included in these statements due to a variety of factors. Thank you. Now I request our Chairman, sir, to make his opening remarks. Thank you. Thank you very much, Pawan. Good evening, ladies and gentlemen. Thank you for joining this conference call. I want to start by thanking the support of all our stakeholders during these challenging times. Our employees have worked tirelessly to support our customers. We also, of course, appreciate the support of our customers. In financial year 2021, the bank has delivered an ROE of almost 10%, with a slippage ratio of 1.18%. The net NPA is at INR 36,810 crores, which is 0.5x of our financial year 2021 operating profit. In addition to a PCR of 70.88%, the bank has additional provision of INR 25,376 crores at the end of financial year 2021. I would like to highlight that the bank has delivered almost a 10% ROE in a year when the credit deposit ratio is at a cyclical low and when the incremental credit deposit ratio was only 26% due to various one-off factors. The bank has demonstrated its resilience in this challenging period. In the long term, the commitment of the management remains to demonstrate that this institution can deliver sustainable ROE of 15%. While challenges remain due to the COVID-19 and its resultant impact, we believe that the bank can weather the disruptions and come out stronger. We won't give a timeline for our ROE target in the current uncertain environment. However, we remain confident that the bank has enablers in place to deliver 15% sustainable ROE over the long term. In our view, the recent past from 2016 to 2020 is only a small period for a bank of our heritage of more than 215 years. We believe with the efforts of our team, we have put up that the period behind us should be a history now. We have used that period to further insulate the bank against visible and invisible risk, further strengthen our processes, and have put in place long-term value drivers like digital banking and stressed assets resolution skill sets. We remain well-capitalized with a CET ratio of 10.02%. Given the dynamics of our business, our competitive positioning, and our value drivers, we believe our current capital and future internal accruals will be sufficient in helping us achieve our long-term growth and return targets. We remain conscious that the cost of equity is a value driver of our bank, and we intend to minimize the same to maximize the value of our existing long-term shareholders who have supported the bank in very challenging periods. We believe at our scale and the resultant complexities, we have been successful in balancing the requirement of all the stakeholders. Concluding my opening remarks, I would like to thank you all for the support to this institution. We remain committed to reward your trust in us with superior sustainable returns over the long term. My team and I are now open to taking your questions. Thank you very much. Thank you very much. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on your touchtone telephone. If you wish to remove yourself from the listening queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the questions queue is ending. The first question is from the line of Mahrukh Adajania from Elara Capital. Please go ahead. Congratulations. My first question is on your interest reversal. What was the total interest reversed in Q4, including interest on interest? Yeah. As far as the interest reversal is concerned, we reversed about INR 2,127 crore during the quarter as the performance of previous quarters was stamped as NPA. Also interest on interest component is somewhere around INR 830 crores. Okay. Both together around INR 30 billion. Yeah. Okay. The other question is that. Actually, if we reckon that component, the number which actually is the NII for the quarter will actually look to be an improvement of 4.18% sequentially as against a decline of 6.08%. Which apparently is looking like that. Correct, sir. Sir, my other question is on inter quarter netting. In the third quarter, we had recoveries of the second quarter proforma slippages of around INR 60 billion. Was there any such inter quarter netting in the fourth quarter in the gross slippage number? The reason I'm asking is, okay, yeah. Yeah. Actually, since this was a year-end closure, there was no question for us to account for any such recoveries as on March 31st. Okay. This is the complete gross number without any inter quarter netting. Absolutely. Okay. Sir, the reason I'm asking is because if you try to subtract nine months agri slippage from full year slippage, then it's kind of a negative number. Yes. Mahrukh, these numbers, actually the aggregate NPAs have come down. Okay. Yeah. Okay. Got it, sir. Sir, my third question is on April collection efficiency. Firstly, what is the total number of infected employees currently in the bank? Do you have it? Well, of course, the number would not be there with me rightly right now. Nevertheless, we have made some efforts. As our own infrastructure is concerned, we have tried to convert them into the quarantine centers. Almost about 1,000 such beds have been created as the quarantine centers. We are ensuring that our employees stay protected, and for that we have also got the vaccination done. Almost about 110,000 plus employees have already been vaccinated in the bank. That's what the situation is. Sir, April collection efficiency and even any color on May collection efficiency that you could give because the problem started after the fourth. April collection efficiency is around 95%, 96%. May is, we have not yet looked into it. It looks like to be around the same as of now. March would be what compared to this 95%, 96% in April? I think March was little better than this. 20 basis point, sir. 20 basis point more it was in March. Okay. There has been no impact of the second wave on your collection efficiency. See, I mean, 20 basis point impact, which is there. Moreover, there's always some kind of a lag between the event and the actual collection. That is something which we'll have to wait and watch. Sir, my last question is on Xpress Loan. We already have a book of INR 1.9 trillion. It has grown 8% quarter-on-quarter and 36% year-on-year. It is a very sizable book. Can you give some more color in terms of number of accounts over which these loans are split and total percentage of government employees who avail these loans, including defense and all? All government and government-related employees' percentage and also the number of total accounts. It could be majorly government employees only. These are salaried accounts only. Also, a very significant portion of that is, I would say that as high as about 95% would be. No, I think these are salaried accounts, 95%. Yes, 95% salaried accounts. 95% salaried accounts. As far as government employees. 50/50. About, say, yeah. Yeah. Around 50% of that would be the government employees. 50% rest of the corporate employees. Salaried employees Who have salary accounts with us, corporate salary package. Okay. 50% on the growth part, Mahrukh, I think earlier also we had clarified, our focus on Xpress Credit would be on the salaried class and particularly those employees who have salary accounts with us under corporate salary package. Today we have about 1.6 crores customer CSP account. Our penetration, if you take only of Xpress Credit, is just about 19%. We believe that there is a potential to grow this book further. Yes, we are mindful that we have reached certain base number now. We may not be having 36% growth rate. Slightly could be moderated to 30%-31% at least for the current year. Okay. around 19% of 1.6 crore would be the total number of accounts in Xpress Credit? No, there could be some outside the corporate salary package also. Okay. When I'm talking of salary account, there are two types of salary account. Where we have a tie-up with the corporate, where corporate salary package is offered to them. There are other people who have salary accounts with us, where based on their salary details and all, we offer this Xpress Credit. Number could be related. Yeah. There would be much better potential. Even beyond the CSPs, that is what I want. Even CSPs as a group, if you consider my potential target group, I've just got 19% penetration now. The number of accounts we can reach through technology. Yeah, I can certainly give you how many expected accounts are there. Thank you. We would request the current participant to please come up with a question queue for any follow-up question as we have several participants waiting for their turn. The next question is from the line of Adarsh Parasrampuria from CLSA. Please go ahead. Hi, sir. Thank you for taking my question. Congratulations on the great numbers. Question is on the staff overall expenses. I see that, as we had mentioned that the provisions on employee will now go down, but then the salary jump that we have seen from INR 7,000- INR 9,400 is materially higher. Can you clarify, is this the run rate or are there some one-offs in the salary expenses? Just one second. I'm just pulling out the details. Slide 29. When it comes to the salary is concerned, of course, we have paid the arrears this year, so that is something which has gone out. Apart from that, we have got a significant proportion of the retirement benefits, which is pension, gratuity, and other benefits, which is there. If we look at that number on a year-over-year basis, we have actually seen growth in wage revision is a major component in this, which is 78.50%. Overall, the growth on a year-over-year basis is 12.26%. The pension has witnessed a growth of about 2.55%, and which is again a function of the interest rate movements. That is something we have to go by the actuaries' advice. Other benefits have gone up by about 5.91%. That is how it has really stack up. When it comes to the salary per se has witnessed a growth of about 10.85%, and the provision for employees have witnessed a growth of 12.28%. That's how it is done. Got it. Sir, I just stick to if you break up the staff expenses, again, when we try and do that the core cash component of salary moved up from about INR 6,900 crore- INR 9,400 crore, so INR 2,500 crore jump. Some of it was expected as cash payouts after the wage revisions had increased. I believe this was not the increase that was expected. I think if I remember correctly, in the last quarter, it was indicated that we see INR 1,000 odd crore quarterly increase in the salary number. I am just curious if there is anything more or should INR 9,500 be the cash salary component going forward? In quarter four, arrears got paid. Quarter four, we have paid the arrears, so I think it would have some kind of a carry forward in terms of if at all provisions would have been short or something, that would have been accounted for. About INR 1,500 crores. On an average, the increase in salary bill is expected to be around INR 1,500 crore. For a quarter? For a quarter. Got it. As compared to what it was in the past. Got it, sir. Sir, the same question on overheads. There is a meaningful increase in overheads in the fourth quarter. We usually had a very tight leash over the last few years on the overhead number. In this quarter, that kind of jumped. If you can just explain that as well. Sure. In fact, as far as overheads are concerned, the major jump is coming from the DICGC premium, which has gone up because our deposits have gone up and the DICGC premium rates have also gone up. That is the reason why there is a growth in the insurance component, which has gone up from INR 3 crore-INR 13 crore in the previous year to INR 4,348 crore. The other important area where it has gone up is various acquisition and development, which is essentially our BC-related exposure. It used to be INR 2,548 crore in the financial year 2020, and in the year 2021, it has gone up to INR 4,107 crore. Which means that about 61% growth is seen there. That's what is expend here. Just to understand this better, the full year impact of higher premium in deposit insurance has come in the fourth quarter only? Yes. All of it gets paid in this quarter. Is it? It would be as and when the charges went up this year. At what point of the year? DIC premium is paid half yearly. It's paid half yearly. You will see the impact in September and March. Got it. Sir, the last thing I want to check, which has been a very big positive surprise, has been how retail has helped us for the bank, right? We've made a point over the last few quarters through COVID that a good part of our book is salaried to government employees. The quality of the book has been. 0.4% slippage in a pandemic year is extremely strong numbers. Just wanted to understand, would you consider this a sustainable trend, or how should one look at it? Because you're already very good on retail asset quality, and this year in a pandemic, it's been even better. If you can just throw some light on that. When it comes to slippages, firstly, it is a function of the underwriting, and second, it is also a function of the effort to recover. I think when it comes to underwriting, we are not likely to dilute our standards. That is something which will give us edge and going forward, we'll certainly maintain our efforts for the recovery also, as we have been doing in the past. I think, going by these two major components, we hope that we should be in a position to maintain this quality going forward also. Perfect, sir. Thank you and all the best. Thank you. Thank you very much. Thank you. The next question is from the line of Nitin Aggarwal from Motilal Oswal Securities Limited. Please go ahead. Yeah. Hi. Thanks for the opportunity. A few questions. Again, on the OpEx, when you aim for 15% ROE, what levels of cost income on cost to asset ratio are you looking at in the medium term? Well, I have been maintaining that there are certain cost rigidities which we have in our system. We'll have to live with those rigidities. Nevertheless, income is something which is a major focus for us, and we have already started working on it. Hopefully, going forward, maybe in six, eight months' time, you will probably get to see some kind of an improvement in the income lever, which will help us in reducing our cost-to-income ratio. Ideally speaking, we would like to bring it below 50% and would like to keep it at below 50% levels. Okay. Secondly, sir, on the cost of deposits, while cost of deposits has been coming off quarter every quarter, but this time the decline is a little more moderated. Our cost of deposit though, still remains higher than some of the other large private banks. What is the reason behind this, and what sort of rate rising benefits are we expecting here over the next couple of quarters? As far as cost of deposit is concerned, you will have to probably acknowledge the fact that when it comes to India, deposit is a major source for many of the retirees also when it comes to their income flows, and it is always a function of the inflation also. I think, for all purposes, we have come to a situation where, to my mind, as far as deposit rates are concerned, they have already bottomed out. Perhaps it may not go down anymore. When it comes to franchise value, we have to keep that in mind, and we have to also keep in mind the overall a very large community of the depositors who are actually retirees. With that in mind, there are certain considerations which you have to keep in mind. We'll try to keep the deposit rates at this level for some time to come. When it comes to our term deposit rates, we have already brought it down significantly already. I think, to retain at that level, and we'll see that how long we can stay on at that level. Sure, sir. Sir, lastly, our SA numbers have been vastly different from our closest PSU peers. While this has been so for very long, but just wanted to understand, is this only a function of the customer profile underwriting or the way we do our monitoring and collections, which ensures this, like the borrowers pays up on time? I am just asking because the gap is just too wide between us and the next best PSUs. In terms of asset quality, you mean? The retail asset quality? No, SME numbers. SME numbers. Okay, SME numbers. Yeah, sure. Yeah. SME numbers involve a very close follow-up, and it involves a follow-up at different levels. We have the follow-up teams which are there in each of the circles when it comes to retail. In fact, in the large corporate book, we don't emphasize much of a challenge. Nevertheless, in the retail, particularly in Agri and SME, we have a situation where we ensure that people in the circles are in a position to follow up and ensure the upgradations of SME tools. Sir, any reason that comes to your mind why the difference is so big between us and the next PSU peers? Will not be in a position to comment about other PSU peers, nevertheless, we are making all possible efforts to see that we contain these numbers and bring it down. Which essentially means that a close follow-up is something which is a very much integral part. Sure, sir. Thank you so much. Thank you. The next question is from the line of Suresh Ganapathy from Macquarie. Please go ahead. Thank you. Sir, two questions. One is, RBI had recently fined SBI for payment of commissions to employees. Can you just highlight what exactly was the issue? That's one first question. The second is on credit growth. How much of, sir, do you think this is a demand versus supply issue in the sense that banks like you becoming a bit more conservative and therefore not willingly disbursing credit? Also, is it a function of the fact that demand is very weak in the economy and therefore the credit growth is so weak? Thank you, sir. Right. The first question relating to RBI fine to bank for giving commissions to employees. I think that probably needs to be clarified a bit. We are the corporate agents who find our distributing products of our JV companies, and in lieu of that, we get a corporate commission. Out of the corporate commission, we have got a system in place where we are incentivizing our employees. That incentivization is not only for marketing of each and JV products only. That actually is a very comprehensive matrix which we have, which covers the bank's own product recovery efforts and also third-party sales, which is actually our JV products. Based on the evaluation through that mechanism, this kind of an incentivization used to happen. Nevertheless, since the regulator has fined us, we pleaded before the regulator, but nevertheless, they decided we have honored and paid for that. As far as we are concerned, we have done it as per what the overall regulation and the boundary conditions were at the material point of time. Nevertheless, they having fined, we have stopped doing any such kind of incentivization for our employees. Sir, just to interrupt, other banks also do this, right? They give incentives for cross-selling and third-party distribution. I will not be in a position to comment on that because this is a view taken by the regulator for us, and I can only convey the viewpoint and the standpoint taken by us in this matter. Fine. We respect the regulator decision, and accordingly we have started working in this manner. Sure. The second question was relating to. Credit growth. Yeah, credit growth. See, the credit growth, I would like to mention here, the corporate credit growth almost about we had unutilized lines to the extent of 70% in the working capital. When it comes to the term loans which you have mentioned, almost about 28% of the term loans were not dispersed. When it comes to utilization of lines, to my mind, it is a function of the demand. As the demand picks up, the corporates also start availing these limits. That is one factor. The other very important factor is, as far as large corporates are concerned, they have got options available to raise money from the debt capital market and the equity capital market also. Since these markets were flush with funds the corporates could find it easier to raise money from these options. If at all we capture the evolution of our bond book, I would say that the corporate credit growth is almost around 6%. Okay. Thank you. Thank you. The next question is from the line of [Akriti Kapoor] from Goldman Sachs. Please go ahead. Yeah, thanks. Good evening, sir and everyone. Hope you all are doing great. A couple of questions regarding the earnings announced already. I've got three questions. The first one is on the. [Mr. Kapoor], we would request you to please come on speaker. We are not able to hear you clearly. Is it better? Yes. You can go ahead. Yeah. Okay. Thank you, sir. Sir, first on the potential restructuring of loans which RBI has allowed. What could be the potential pool of restructuring that we need to do, particularly in the MSME portfolio? I think we'll have to wait and watch for some more time to come. What our last years' experience is, when it comes to restructuring book, we had a total restructuring applications worth about INR 17,852 crore. How will the corporates or maybe the SMEs will really respond, we'll have to wait and watch. Nevertheless, we are in readiness to offer them the support if at all they need it. We have already put in place that structure. The policy is already approved and also put in place that structure. We'll be reaching out to all those who are eligible through various SMSs and emails, et cetera. Based on their response, we'll be in a position to take stock of the situation. We are about to begin that particular stage, so it is too early for us to visualize what is the likely book which will go through a restructuring. Okay. Sir, if you look at last years' experience and this number of INR 17,500 crores, INR 18,000 odd crores, how much of this would be on account of MSMEs? I guess we had also done it last year also something. [audio distortion]. Last year out of the INR 17,852 crores, about INR 2,000 odd crore was an SME. The last year and this year situation seems to be a little different, but I think we'll have to wait and watch because normally what happens is that SMEs are also very mindful of the fact that if at all they avail the restructuring, it will have an impact on their ability to raise resources at cheaper rates. I think we'll have to wait and watch and see how situations are, and maybe then only we'll be in a position to give some kind of a color on that. Got it. Sir, this SMA- 1 and SMA-2 data that we give which is for loans more than INR 5 crores, would you also be able to share some sort of a DPD breakdown for the retail and the MSME portfolio less than INR 5 crores? I think below that the collection efficiency should be a good indicator. You don't share that. Yeah. We will not be in a position to share below that, below INR 5 crore. Collection efficiency being around 95%-96% could be a derivative number which can give some kind of a color on the book. Also just to supplement what Mr. Khara is saying, our collection efficiency is based on the fact that we consider seven-day overdue. DPD To 89- DPD. The whole gamut of DPD is covered in this one single number what we are giving. Also it covers across the business segment. I think that's a better indicator, as you said, instead of actually getting into the DPD. We've been consistently giving this number every quarter. Just to understand, you're saying this is 95%, 96% is based on 89-day DPD? No. As in whatever account is. 7 days-89 days. Seven days to 89 days. Seven days to 89 days. Yeah. Okay. This would also include agriculture, I guess. Other than agriculture. Other than agri. Other than agriculture. Okay. Agri is a seasonal repayment. Yeah. Whenever there's a harvest, then only there's a repayment. Yeah. Crops, I agree. Sir, one more question on the NARCL which has been operationalized as per the media articles. Can you share with us what would be the broad contours, how much of portfolio that you will look to transfer against you're already carrying provision. Will you need to make any more hit or there'll be cash recoveries in the back of this? Any color you can share on that. We are in the process of finalizing the accounts, but as far as any more provisions to be taken, I don't expect. That is one. Yes, of course, we'll certainly be transferring the accounts, and we are quite convinced with the concept and we are quite hopeful that it will be a very positive development when it comes to the resolution of the stressed assets in the economy. Got it. Sir, one more question, but I'll come back in the queue, but if you allow me, I can ask. That is good. Yeah. Sure. Sir, this is with regards to the investment in technology. Based on the NPCI data, our technical decline seems to be on the higher side compared to the peer banks. How would you view that and would it mean that we need to up our investment significantly in the technology side, including hardware and data centers, et cetera? It's a ongoing process. We are quite cognizant of the fact that we have to keep on investing into technology and we have to make a very robust database and also very robust systems and platforms. That is something which we are quite committed and maybe I'll ask Mr. Ashwini Tewari to come in who looks after technology. To supplement what the Chairman said. He's right that the investment is a continuous thing and we are all mindful of the fact that the digital transaction, especially UPI has really been setting all records in terms of numbers. Therefore, there was a lag of investment in the infrastructure, which has now been done. If you notice the latest figures which have come out in February and March from RBI, their technical declines have come down significantly from what they were in November, December. The improvement has already taken place and we are hopeful that with this continuous investment and monitoring, we'll be equivalent or better than the peers. Sir, the reason why I ask this question is because one of the large private sector banks, of course, all of us know they were banned to onboard new credit card customers plus launch any more digital businesses. Given that our number is on the higher side, do you think this is something that can perhaps impact us also and impact because what measures can we take? Yeah, I get your point. Actually, if you talk about our core channels, which is YONO and the internet banking. We had some issues in November, December where we had problems, but I can give you the data of May, which is not in public domain yet in the sense that we had zero downtime in internet banking till May 20th, and we had about some 13- minutes in YONO, unplanned downtime. Therefore, lot of improvement has already happened in these channels. On UPI also the technical declines have come down to below 1% for the latest available data. We have seen improvement. Of course, we have to see whether this sustains. We are continuously working on this and hopefully we will not have an occasion. Our effort is to ensure that it remains sustainable and whatever we have done in the recent past was strengthening these delivery platforms. We will continue to be very focused on ensuring a delivery which is without any disruption. Thank you. We would request the current participant to please come back in the queue for any follow-up questions. The next question is from the line of M.B. Mahesh from Kotak Securities. Please go ahead. Good afternoon. Just two questions from my side. This year if you look at the recoveries, you have had about INR 17,000 crores of recoveries from the NPL line and about INR 10,000 crores of recovery in the non-interest income line. If you could just give us some color outside of the one NBFC which is sitting there, what are you seeing in terms of your recovery from the NPL/return of pool? I don't think we would have much of chunky accounts left out now. We will be actually resorting to NARCL, we'll be resorting to the compromise settlements, et cetera. Maybe I'll ask Swaminathan. Yes. If at all he can give some color on that. Just to supplement to what Chairman said, as far as recovery is concerned, more or less, the numbers would remain in line with what we had achieved last time. Only difference will be that in the last couple of years, there were certain chunky accounts which got resolved. Today, the recoveries for this year and going forward will have to happen across many accounts. We are working on those granular details. Also, it will depend on how fast the second wave settles down so that our recovery efforts can get intensified. At this point in time, we are not giving a specific number for recovery that we are budgeting for this year. Maybe over the next four to six weeks we will come up. Maybe as part of the Q1 call, we may be able to give you a guidance in this matter. Thank you. Perfect. Sir, just one clarification here. This commodity rally that you are seeing out there, has it resulted in a better interest for those distressed assets, or do you think it is an over expectation given the fact that these assets may have significantly deteriorated on the ground? Absolutely. In fact, we have seen renewed interest. With this cycle getting better, we in fact got better realizations in a few accounts, and we are hopeful that this upside cycle will be beneficial to us in terms of improving the recovery percentage out of these distressed accounts. There are interest coming in the brownfield assets. We are working on this and would like to make full use of this upside that is now visible. My second question is on the net NPLs. Today, your corporate book is carrying approximately 90% coverage. Could you also tell us what would be that in terms of absolute amount, the net NPL which is being. Net NPLs in corporate book is almost down to INR 8,000 crores. As a total net NPL out of INR 36,000 crore plus, the corporate book is about INR 8,000 plus. This year you would expect most of the slippages, most of the provisions only for your retail and MSME/Agri book. Is that a fair assumption? MSME/Agri would be the major. Retail is also not much. Yeah. Retail is also holding on well. It'll be MSME and Agri will be the space to watch out. That's the space we are also very mindful in terms of keeping track. Perfect. In that context, can you give now a guidance to provisions for next year, or you think it's going to be challenging? Too early at this point in time. We need to size up maybe another four to six weeks time it will take for us to estimate the impact. We don't want to give any estimation or guidance. As promise is concerned, I would like to deliver better than the promise. Absolutely. Thanks a lot, sir, for this. I'm done. Thanks. Thank you. The next question is from the line of Aditya Singhania from E NAM Holdings. Please go ahead. Thank you. I actually wanted to clarify on the provisioning question that M ahesh just asked. I understood from your TV interview that you guided that credit costs could be similar in FY 2022 to FY2021. In that context, your credit cost mentioned in the presentation is 1.1%, which is the loan loss provision number. No, I mentioned that it will be within 2%. This has been my guidance even in the third quarter. Right. This has been my consistent guidance always. I think our effort would be to keep it at 1.12%, but nevertheless, to keep it below 2%. Ideally speaking, we would like to keep it at 1.12% where it is this quarter, but in any case, less than 2% by all means. Right. Just in that context, if I could ask, you're already sitting at 70% provision coverage ratio, and an additional buffer due to COVID, with the strong corporate net NPLs, the low corporate net NPLs as well. Where would you expect such a large provision number to come from, if at all? As I just mentioned that SME and Agri are the areas to watch, and that is something which we are ensuring that the quality should hold up. The very important aspect is we are a little unsure about the current COVID wave, how will it really pan out, and what all impact will it leave. It may so happen that it may not leave much of impact. Nevertheless, I think we should rather be better prepared for any kind of a eventuality. Right, sir. Thanks. Just one more clarification. If you could talk about any plans for listing of your subsidiaries, the general insurance and asset management. We do have plans, but much of it will depend upon how the capital market continues to evolve. We will be very mindful and at the appropriate time, we will be coming to market. Right. Thank you, sir. Thank you. The next question is from the line of Jai Mundhra from B&K Securities. Please go ahead. Hi, sir. Thanks for the opportunity. Sir, A, if you can share the ECLGS loan that the bank has, which the bank has disbursed. More importantly, if you can share the outstanding loan which is linked to this ECLGS disbursement book. In a way, if you are keeping a track of the principal as well, how that has moved. A, the ECLGS amount and the B, the principal which is linked with the ECLGS disbursement. 25,000 crore is the ECLGS book which we have created last year. No. Was there a difference? If you are talking in terms of the overall exposure which is linked to the ECLGS, we don't have the numbers as of now. You must also remember that ECLGS repayment has not begun. That will be from June onward. How the ECLGS-linked principal outstanding will behave probably we'll come to know from June onward. Right. ECLGS is 20%. Yeah. Of the exposure. If it is INR 25,000 crores, you can do a reverse work, but that's not a concern at this point in time. That will have to be looked at later. Right. Broadly, that number should be five times of the disbursed amount, right? Assuming there's no significant repayment as yet. Yeah, absolutely. Repayment has not started. Not started yet. Some of them might have availed a lesser amount. No. It was maximum of 20%. Under the some people would have drawn only 10%, 15%. If you want a ballpark figure, I think you are maybe around 20%, that is five times of it. Sure, sir. Second question is, sir, on staff cost. I think this question was asked earlier, but just to be very sure, I think we had also seen that in PSU banks, it looks like there has been some performance-based incentive that has been given by at least a few banks. Is that the reason why the salary cash component has risen from INR 7,000 odd crore to INR 9,400 crore, or just the earlier as mentioned earlier? This was because if at all that has to be paid, that will be paid based on this year's results, and we would have only made a provision for it. It would not have been cash outflow. That would not have been booked like that. Nevertheless, as was mentioned, the INR 1,500 crore is the quarterly expense which is expected. Right, sir. The last thing, sir, on SMA book again, can the retail below INR 5 crores SMA, because other banks' data suggests that the overall SMA including INR 5 crores number is running into double-digit number. For SBI, you had clarified that you are not looking at the below INR 5 crores number. Somehow any perspective, sir? Perspective on what? Below INR 5 crores? Yeah. Broadly, as you have said that one minus collection efficiency is a derivative, but just to be confirming that it cannot be a double-digit number for SBI. We can only reiterate what was said already. Retail is typically asset quality or DPD is depicted in the collection efficiency. INR 5 crore and above as per the CRILC data. You want a comfort, we can confirm that it's not double-digit. Sure. Thank you, sir. All the best and come back. Thank you. Thank you. Thank you. The next question is on the line of Manish Shukla from Citigroup. Please go ahead. Good evening, thank you for the opportunity. The loan processing charges for the full year are up 20% when loan growth is 5%. Why that disconnect? Sorry. No, the loan processing fee has gone up by 20%, slide number 28 sir, while the loan growth is 5%. See, the point is that loan growth is the actual availment. Loan processing fee is a limit. Limit sanctioned. Limit sanctioned, which I mentioned also that there's availment of just about 70% of the limits have been utilized. Similarly, when it comes to term loans also, almost about 28% is the unutilized portion. That is a reason that why the loan growth is appearing to be muted as compared to the loan processing charges. One more thing also, if I can add, is that loan processing charges are also collected on the renewal. That means, without any new facility being given, even if the annual renewal is there, that also the loan processing charges will be there. Sir, in case of an annual renewal, the fees would have been there in your base last year also, right? Unless you're charging more on the same loan. Here we recover but it's not the availment as what we recover at the first instance. That is an annual. Year-over-year. Okay. Year-over-year, yes. In a way, yes. I think what Chairman has said makes. That is the reason. Typically in term loans, it's paid upfront while the availment will be over a period of time. These two numbers cannot be necessarily related to each other. These would rather always be independent because. Yes It will be all growth is the actual draws. That's the limit sanction. Okay. Going to overheads, what is your exact nature of this business acquisition and development expenses? That has gone up 60% for the full year. This quarter it is up two and a half times year-over-year and quarter-over-quarter. Yeah, because we have significantly ramped up our BC network. That is the reason why this has gone up significantly. Is this for origination, for collection, or where does that on the business side? BCs are for carrying out operations. Since we have got a huge network of BCs, which we have added in last one year. That is something which, also now we have started using them for collection purposes also. That has been started only very recently. This also reduced the home loan sourcing fees. Home loan sourcing fees. It is not. With the volume point we are witnessing in home loans, fee contribution has been increased. Okay. I think other question, sir, is on the loan book. Now your retail loan book as of March 2021 is larger than corporate. Obviously, retail has grown at a very fast pace over the past few years compared to corporate. How do you see the incremental shift happening for you between retail and corporate over the next few years? If at all the economy will start growing at about 10%+. 9% is something which is being talked about by various economists, and we have a chance to grow at about 10%. The growth will come from SME and corporate. Okay. In the absence of that, retail will still continue to grow faster? Retail will continue to grow because there is a scope, there is opportunity which is available, and we would like to tap all that opportunity. Okay. The last question, sir. In your opening remarks, you talked about capital requirement over medium term, but the way things stand right now for the next year or so, how do you see your capital requirements? If at all, let's say, 10% of the asset growth, perhaps we can live with the current situation. We will probably assess the situation once the COVID-2 is behind us, and maybe that will be a point of time when we'll have a better visibility of growth, and that will be a point of time when we'll decide about the capital. Sure, sir. Thank you very much. Very impressive. Thank you. The next question is from the line of Saurabh from JP Morgan. Please go ahead. Yeah, sir. Three questions. One is why is the current account number so high this quarter? Quarter-to-quarter why? The second is on this provisioning slide, I mean, on the standard asset provision. There is this INR 4,900 crore of other provisions for the standard assets. What does it relate to? Generally, do you have a policy on how will you draw down on your standard asset provisions? I mean, can we expect a draw down in FY 2022 against the SME stresses? Thirdly is, can we just quantify the technology spend in the bank, both OpEx and CapEx? Thank you. Sure. First, I will take your question relating to this current account. Current account, we have opened. There was a sharper focus on opening up new current accounts in the bank, and that is something which has paid off in a way, and we have seen the kind of growth which you have seen. The second question was relating to. Can you please repeat the second question? Sir, this was on the INR 4,900 crore. Standard assets provision. The comments. Yeah. Standard asset provision, actually, we maintain 0.25% of our standard asset as a provision. That is something which is there. To use that, if at all those standard asset turn into impaired assets, then only those provisions are used. Otherwise, it remains as it is. No, sir. My question was on the INR 6,300 crores and the INR 4,900 crores, the additional provisions you have made over and above that. INR 6,300 crore. Okay, fine. That is additional COVID-19 provision of INR 6,300 crores and which we have kept. That is essentially to meet the contingencies if at all it arises now post-COVID-2. That is one. INR 4,900 crores again, they are the other provisions. The big standard provision plus the restructured provision to be kept on the COVID restriction that is implemented so far. Okay. The weak standard assets plus the restructures. Yeah. Standard assets, as per the regulatory requirement, various rates are maintained. We also maintain some additional provision in respect of structures identified as stressed. Also now the new addition during the quarter is the restructured assets under the COVID package. Okay. Sir, on the technology spend? Technology spend, just one second. Give him the figure. Yeah, we will give you the figure. Give us two minutes. We'll just get the figures. Okay, sir. Just on this current account one, sir. Was there a benefit because of this RBI circular in October or? No, not really so. It was essentially effort which was initiated for some time. We have strengthened our CMP also, cash management product facility, which we are offering. Current account is a function of various add-ons. That is something which we are offering. Okay. Thank you. Thank you. The next question is from the line of Ashok Ajmera from Ajcon Global Services. Please go ahead. Good evening, sir. Please accept my compliments on the fantastic number of results. In fact, you have brought the whole sentiment in the entire banking stocks and the financial stock up today with this kind of result with the NIM going 3.26%, CAR is 13.74% and some profit. Good ROA of 0.48%. My compliments to the entire team. Having said that, sir, I have got a couple of information points and some data points. Sir, in our note number 13, INR 830 crore is the interest reversal. As per the Honorable Supreme Court's order. This entire INR 830 crore has been in this quarter only naturally because the order came in March 2021. It means the interest which was charged up to the last quarter, that is December quarter also, everything has been reversed now in this quarter, isn't it? Yeah, that's right. Apart from that, there is unrealized interest also, which was about INR 2,100 crore, which was also reversed. Yeah. That is again, in fact, a plus point as far as this quarter, otherwise the results would have been. Yeah. I will give you the number. Interest reversal was INR 2,127 crore during the quarter. Okay. Apart from INR 830 crore, which was interest on interest component. It is on interest. Better than that, the NII for the quarter has improved by 4.18% sequentially, instead of a decline of 6.08%. All right, sir. Sir, this RBI has recently announced one COVID loan scheme, of INR 50,000 crore, for taking at the repo rate and getting that benefit of 0.40 or 40 basis points if you again put the money back to the extent of the loan given. Whether the bank has come out with its policy for this COVID loan for the medical purposes, and if yes, whether it is implemented and how much has already been sanctioned under this scheme? What the bank plans to do for the remaining period? Ajmera Sir, first of all, thank you very much for your compliments. Now the other piece is relating to this health infrastructure-related COVID book, which is expected to be created. Internally we have thought of that we can create a book of somewhere around INR 10,000 odd crore. We already have got some exposure to pharma sector, which is to this extent already. We will be very aggressively supporting the hospitals and nursing homes who are augmenting their oxygen facilities. Yes. The pharma sectors also, if at all there would be demands, we're more than happy to support their initiative. Sir, would you be considering the NBFCs also for the onward lending to the India particular area? We are quite open because RBI schemes permit us to do that also. We'll be quite keen to support any such initiative. What you mentioned was in terms of we may not avail the facility under repo, but we'll be happy to avail the reverse repo facility and also the most important factor for us is the priority sector component. The priority sector is something which we are very happy to look at it. Yes. Sir, now coming to this credit growth of 10%. Sir, the corporate book as such is not growing much. The overall I think was just 6%. In the personal loan, the slippages have come down from INR 4,507 crore- INR 3,287 crore in this year as compared to 2020. At the same time, the personal loan book have already grown. All the retail personal, they are already growing and every bank is chasing it. Where do you see basically the loan growth coming now in 2021, 2022? And how are you so hopeful of growing your book? I'm hoping that SME would be a good opportunity. Apart from that, even in the corporate sector also, see, corporates all these years had an option to go to the debt capital and the equity capital market because the markets were flush with liquidity for the reason that the West was not looking as good. Now, having seen the fact that in the West, practically all the economies have vaccinated themselves well. I expect that there will be huge growth opportunities there. Perhaps some money which used to flow in here, it may not be available. That kind of a liquidity may not be available in the system, and corporates might come back to the banking system for drawing the funds. That is how I look at it. Thank you. We would request the current participant to please come back in the question queue for any follow-up questions. The next question is from the line of Nilanjan Karfa from Nomura. Please go ahead. Thank you, sir, for the opportunity. Probably a repeat of few questions. On the AUCA this quarter, can you confirm that we basically took in the Bhushan recovery, right? Bhushan recovery was INR 4,032 crores. INR 4,032 crores. Accounted for in this quarter, right? Yes. Yes. Okay, good. Just for clarification, in the note 17, that table is basically what we have implemented, right? Yes. Under application is the INR 17 odd thousand crores. That's the broad difference. That [uncertain] is implemented. Correct. Related, sir, you have already talked about the Wave 2 impact and that you don't want to hazard a guess. I can understand it. Every news flow does seem to suggest that tier 3 onward, the impact has been particularly severe. Any initial feelers you have in terms of while it's such a humanitarian crisis, but any initial feeler about can things specifically that agri and agri-related retail, can that get really bad? In that context, we had such a great performance, why are we just carrying about 60 basis point additional, other than standard provision, just a 60 basis point additional provision. Should we not have taken in maybe another 50 odd basis points? It would have given a lot of confidence around the balance sheet, sir. No, actually, the point is that Wave 2 is a bit of an uncertainty, which we are living through, and with what is being talked about is Wave 3 also. I would say that we have moved up on the learning curve, but nevertheless, the severity of Wave 2 is something which has actually hampered life for many. That is something which is the cause. We are actually sort of going through a very uncertain phase right now. Because if at all we have got such kind of uncertainty, the better way out is to keep as much cushion as possible to really tide over such uncertainty. I think, as I mentioned, that maybe by the end of June, we'll have a much better visibility. That is a point of time when we can probably take a call. Okay. In any case, as a philosophy, we believe in strengthening our balance sheet. We don't want to compromise on that principle. Sure. The broad feedback is that in June, we'll probably take that call. Yeah, June, we will take a call. Okay. A quick data point, sir. Out of that INR 25,000 crore ECLGS, roughly how much was the ECLGS package two? ECLGS package two. Just give me a minute. We'll revert back to you. We'll tell you. We'll just let you know. In the meanwhile, there was one gentleman who had asked me about questions relating to IT, CapEx and OpEx. IT CapEx spend is about INR 1,300 crore. OpEx is about INR 5,800 crores. Thank you. The next question is from the line of Mona Khetan from Dolat Capital. Please go ahead. Hi, sir. Good evening. I have two questions. Firstly, in the corporate segment, your nine-month pro forma plus supported slippages were around INR 3,000 crores, and that has now increased to about INR 7,700 crores in the current quarter. Is it fair to say that a large part of slippages during this quarter came from the corporate segment? If so, could you just throw some light on whether it's related to potential restructuring or in terms of the size of those accounts and the sector? Can you please repeat your question? Yeah. When I look at your nine pro forma slippages for corporate segment, pro forma plus reported slippages, they were about INR 3,000 crores in the last quarter, and that now increased for the corporate segment to about INR 7,700 crores. An addition of about INR 4,700 crores in the corporate segment this quarter versus total slippages for the quarter at about INR 5,600 or thereabout. Essentially, a large part of slippages during the quarter have come from the corporate segment. Just some color there. Which slide are you referring to? She's referring to the nine-month slippage. Okay. Last quarter and the Q3, the corporate was at INR 3,300. This quarter, it is INR 7,000. Quarter four is INR 6,558. Yes. About INR 3,000 odd crore. Do you have some color? I think we'll have to look into that, and as of now, we'll have to look into what are the accounts which have contributed to this. Normally, we don't give specific accounts, nevertheless, whatever was there, we've already taken care of. Nevertheless, I don't have the ready information on this. Okay. Secondly, on the restructured book, we have a restructured book of about INR 18,000 crores, including potential restructuring. What is the kind of provisions that we hold against it? For restructured book, our requirement would be we would be holding 15% provision. There's note number 17. Already restructuring implemented, note number 17 carries the restructured book as well as the provision. INR 1,126 against INR 6,125. Note number 17, not slide 17. Okay. Note 17. That's in the notes. For the remaining application for which the process is on, we have made a 10% provision upfront. They will become specific once the restructuring package is implemented. Hope it's clear to you. Yeah, just one on the restructuring again. You've given a potential plus restructured total number of about INR 18,000 crores. This includes the non-COVID related SME restructuring as well? The INR 17,852 contains all types of restructuring as segment-wise breakup is also available in slide number 18. You will see SME INR 2,118 crores there. Out of the INR 17,852, INR 6,125 is already implemented, for which specific provision is already created. That's there in the note number 17. For the remaining INR 11,000 odd, which is under process, a 10% provision is already created. That will become specific once the restructuring is implemented. Thank you. I take the last question from the line of Saumya Agarwal from Smartkarma. Please go ahead. Before Saumya asked, I think there was some question on the ECLGS. The ECLGS one, we had disbursed INR 23,000 crore. ECLGS two, we have disbursed INR 200 crore. I think together disbursed INR 25,000 crore. Now Saumya can go ahead. Okay. Hi, good evening. Just want to understand some trends here. Since SBI is the market leader in the banking space, it's been widely concluded that agricultural has been the largely resilient segment amid the pandemic. If I look at the fresh slippages for FY 2021, almost INR 9,500 crore or 33% is coming from the agri book. Even in terms of gross NPA, it is the most stressed segment at around 15% NPAs. What explains this dichotomy? If you could shed some light on this. Can I just please reply. The point is that, agri, traditionally we have seen that this particular book is behaving. When it comes to SME, yes, of course, we have seen a very different trend. As [uncertain] is concerned, I would say that the trend is more in line with what we have seen in the recent past. But maybe I'll request [crosstalk]. Yeah Mr. Setty to have better color on this. I think your question, last part also, I think many of the analysts have asked if the rural economy is doing very well and how is that affecting the book. If you see, much of the slippages have happened in the first two quarters in the current financial year. We have also explained that the agricultural slippages happen for non-renewal of the crop loan. When you don't renew the crop loan, it will be classified as NPA. First two quarters, we were not able to do. The slippages have been higher. Subsequent two quarters, not only that, when the lockdowns have lifted, our people were able to approach the villagers, farmers, and the renewal percentages has gone up. Aggregate slippages in the later two quarters has been much lower than the first two quarters. Again, it all depends on the composition of our agriculture portfolio. Out of INR 2 lakh crore, we have about INR 1 lakh crore crop loans and INR 70,000 gold loans, which is a safer portfolio for us. In these crop loans, it's seasons and as well as debt relief measures announced by the state government, which will impact the renewal percentage. The moment the debt relief scheme, like for example, Maharashtra, we have issued almost INR 5,000 crore of debt relief loans, where the NPA levels have dramatically come down during the current financial year. It's all one year to another year, the agriculture portfolio behave differently. The last year has been that in the first two quarters, we had tough time in terms of crop loan renewal, which had contributed to slippages. We were able to pull back some. We are still working on that, and I think the improvement in the agriculture portfolio is visible in the last two quarters. Hopefully, that will continue. Only, as Chairman initially pointed out, because of the smaller centers and villages are also getting impacted by COVID, there would be some stress on the agriculture portfolio going forward. I would like to add, the very structure of agriculture book is about INR 60,000 crore would be to SHGs also, and normally they have got a very good repayment behavior. Actually, INR 60,000 crore + INR 40,000 crore, which is gold loan. There is not much of concern. The major concern is out of this INR 1 lakh crore. There also, if at all we succeed in doing the reviews, and then the quality is not as much of a challenge. Yes, of course, COVID-19 has restricted mobility. That is the fact which we need to keep in mind. Also, this happens soon after the harvest when people have to go for sowing. The review renewal happens around the same time. Actually, it is a seasonality and at the material point of time, if at all there are any restrictions on mobility, that causes problem in the agri book. Yeah, please. Regarding the earlier question on slippages in the corporate book of INR 6,558, there was one account of INR 3,650. That was purely on technical reasons. That will get into standard within this financial year itself. There was another chunky account also. There also, I think we will be able to recover. Out of this INR 6,500, INR 4,500 will move into standard within this year itself. Thank you. Due to time constraint, that was the last question. Okay. On behalf of State Bank of India, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.