In an interview with CNBC-TV18, CVR Rajendran, MD and CEO, CSB Bank, said that gold loan disbursements in Q4 will be around Rs 3,500 crore. According to him, gold loan disbursements have progressively scaled up for the bank and have been higher in Q3 than Q2.

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He said, “Rs 3,500 crore will be the disbursement from the current quarter, according to our estimates. And disbursements in other areas have also increased.”

Shedding light on the gold loan portfolio, Rajendran mentioned that the cost of operations is high therein. He explained that ticket sizes are increasing in gold loans. Additionally, he noted that such loans are now being availed by the middle and lower classes. Rajendran is confident that the gold loan market will expand despite the number of players increasing. He expects gold loan ticket sizes for financiers will increase as well.

Also Read: Gold loan demand has picked up in rural and semi-urban areas: George Alexander Muthoot

Rajendran expects Q4FY22 loan growth to be at 21 percent on a year-on-year (YoY) basis. He mentioned that while loan growth has grown for the bank, it is excess liquidity that has resulted in the mispricing of loans. He explained that the bank is losing accounts due to such mispricing. He said, “The overall loan book is growing, but the only problem is excess liquidity has resulted in the mispricing of the loan assets.”

Also Read: India spends record $55.7 billion on gold imports in 2021

Watch the video for the full interview.

First Published:Jan 5, 2022 3:19 PM IST