“We are very clear that growth will not be at the expense of the quality. We may choose to grow in a reasonable way,” said Prashant Kumar, Managing Director and CEO, Yes Bank.

In an interview with BusinessLine, Kumar speaks about the private sector lender’s plans going forward and said that he expects interest rates to gradually go up now. Edited excerpts:

Q

Yes Bank’s third-quarter results have been good. What is the strategy going ahead?

The results were very good in the second quarter as well. Asset quality issues are a thing of the past, which is evident from the slippages also, which is coming down every quarter. The old issues in terms of the accounts have been well provided. Now, it is a growth path. We have robust growth on the retail side of over 25 per cent, 12 per cent in MSME and about 40 per cent in the mid-corporate segment. We are trying to granularise the balance sheet so that there is no concentration risk and the balance sheet becomes very strong in the future. Overall deposit growth is 26 per cent.

Q

The bank has retail to corporate loan mix of 57:43. How do you plan to grow the balance sheet going forward?

The focus would be retail, MSME and mid-corporate segments. We don’t intend to grow very aggressively in large corporates as pricing is an issue. But we would like to participate more of liabilities, technology solutions, working capital requirements. As of now, there is no demand on the large corporate side.

Q

Any comments on the Dish TV issue?

It is very clear. We have nothing to do with Dish TV. We have exposure to the Essel Group, which is an NPA. One of the securities is the Dish TV share. We are trying to see how we can increase the value of our security. But the group is trying to stall everything. They are not repaying.  

Q

Do you think interest rates have bottomed out?

I think interest rates have already started moving up…if you see the 10-year paper. And this is not only in India but across the world. Interest rate like the downward movement has already stopped. It will go up gradually. One needs to control inflation also.  

Q

Are you looking at capital raise as you have got shareholder approval?

Shareholder approval is important, and when there is a good opportunity, one can raise capital. Today our CET is 11.5%, which is sufficient for us. Capital is not required for a legacy issue. It’s only needed for growth. Next year, it would be required when there will be aggressive growth targets and a buffer. So, we will see it in 2022-23, but we will not like to sell it at a cheap rate.

Q

How do you plan to grow the digital banking side of the bank?

We are trying to offer the customers something like a unified app. We also need to provide certain products like trade finance where the customer can issue their own letters of credit. Due to issues with the bank in the last two years, we could not expand on that. But now, it would be very a aggressive push for us. We have already entered into a partnership with Salesforce, and a personal loan product has been launched. We will be rolling out more retail products on the Salesforce platform. The credit underwriting would be very safe, and efficient, in terms of cost-effectiveness.  

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