State-owned Bank of India on Tuesday said it aims to improve collection efficiency and expects GNPA (gross non-performing assets) at sub 10 percent by March 2022 after it posted a net profit of Rs 1,051 crore.

In an interview with CNBC-TV18, AK Das, managing director and chief executive officer, said "Most of the restructured accounts where we have given moratorium for two years and all, the casualties as of now slightly more in MSME. Otherwise, restructured books are well in place."

"The total MSME portfolio as part of the overall book is about Rs 68,000 crore and out of that Rs 5,000 crore is the restructured book. Don’t expect much slippage in that as there is a big dip in slippage including restructured account between Q1 and Q2, it is almost 1/4 of what happened in Q1. However, we would have to improve our collection efficiency," Das said.

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With regards to asset quality, Das said the bank has done exceedingly well in Q2 and recorded a 100 percent rise in net profit, "Our net slippage is Rs 1,304 crore and that is about 0.36 percent of the advances. The bank has effected a cash recovery of about Rs 3,500 crore. So, even if you leave aside the one big account where resolution happened in Q2, our recoveries are much higher than the slippage numbers. This has helped the bank to bring down our gross NPA ratio to about 12 percent about 151 basis points down and net NPA ratio to 2.79 percent."

He said, the bank expects that by March 2022, our gross NPA numbers, which came down by Rs 6,000 crore QoQ will come down to below 10 percent and the net NPA ratio will be well below 2 percent.

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On the loan growth, Das said, the bank could manage advances about 2.7 percent growth YoY and industry has grown by 6 percent and our YTD that is the year to date is about 1 percent growth against 2.5 percent for the industry.

The bank's quarter-on-quarter gross NPAs were down 10.3 percent at Rs 50,270 crore versus Rs 56,042 crore. Net NPAs too were down to 14.9 percent at Rs 10,576 crore versus Rs 12,424 crore. The QoQ GNPA ratio was at 12 percent against 13.51 percent. The restructured book was down 9.5 percent.

Watch the video for the entire interview

(Edited by : Jomy Jos Pullokaran)

First Published:Nov 2, 2021 5:37 PM IST