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Private sector lender IDFC First Bank is targeting loan disbursements between 18 per cent and 20 per cent in the new fiscal 2022-23.
“In the new fiscal 2022-23, disbursements at the bank level will grow anywhere between 18 per cent and 20 per cent. On the retail book, we expect to grow by 25 per cent year on year,” said V Vaidyanathan, Managing Director and CEO, IDFC First Bank, adding that the lender has adequate capital for growth.
The bank had reported an 11 per cent year on year growth in gross funded assets to ₹1.22-lakh crore as on December 31, 2021.
“We are beginning to openly say that all past issues on the lending side are behind us and now we are going to look ahead,” he said in an interaction with BusinessLine.
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IDFC First Bank raises Rs 1,500 crore through private placement of Tier 2 bonds
Capital raise to enhance capital adequacy of lender to 16.5 per centWhen asked if the retail focus will continue, Vaidyanathan said other segments such as wholesale banking, CMS, transaction banking, trade will also begin to grow now.
“On the retail front, home loans is a very big growth area as well as loan against property. Also credit cards, wealth management, FASTags are other growth areas,” he said.
Tier-2 capital
The bank had on February 8 announced that it has raised ₹1,500 crore through private placement of tier-2 bonds, which it had said would help boost overall growth prospects.
Vaidyanathan noted the bank has raised tier-2 capital for the first time.
“We have more headroom to raise tier-2 capital and further improve capital adequacy and give us headroom for growth,” he said.
Including the capital raise, the bank’s capital adequacy ratio touches 16.5 per cent.
Legacy stressed assets
The lender also does not expect any major issues from legacy stressed assets.
“We can put behind asset quality concerns and move forward to growth. We have only legacy liabilities at 8.7 per cent, about ₹27,000 crore, but that is an opportunity as we will replace them at lower rates,” he further said.
For the quarter ended December 31, 2021, the bank reported an 117 per cent jump in its standalone net profit to ₹281.06 crore from ₹129.51 crore a year ago. Gross non-performing assets rose to 3.96 per cent of gross advances by the year end from 1.33 per cent as on December 31, 2020.
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