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Ladies and gentlemen, good day and welcome to the ICICI Bank's Q2 FY '22 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded.I now hand the conference over to Mr. Sandeep Bakhshi, Managing Director and CEO of ICICI Bank. Thank you, and over to you, sir.
Good evening to all of you and welcome to the ICICI Bank Earnings Call to discuss the results for Q2 of financial year 2022. Joining us today on this call are Vishakha, Anup, Sandeep Batra, Rakesh, and Anindya. We hope that you are safe and in good health. India has witnessed a steady decline in COVID-19 cases and a massive pickup in the vaccination program since June, India has now crossed the milestone of administering 100 crores vaccination doses. We would like to extend our gratitude to the efforts and dedication of all the health workers and essential service providers for their untiring efforts in the recovery from the pandemic. I would also like to take a moment to thank our employees for their service to customers in these challenging times. We are happy to share that now almost all our employees have received at least one dose of the vaccine.Economic activity has continued to improve since June. The Ultra Frequency Index comprising several high frequency indicators tracked by the Banks Economic Research Group has steadily increased from 99.6 in the first week of July '21 to 105.5 in September 2021 and reached 110.3 in the week ending October 17. The underlying economic activity continues to show an upward momentum owing to the higher peak power, demand, e-way bill generation and rail freight revenues, improved vehicle registrations on the back of the festive season and rising labor force participation rate in the urban areas. Overall industrial activity is above pre-COVID-19 levels. The progress in the vaccination program is supporting an improvement in mobility indicators. We expect the festive season to give further impetus to economic activity.During the challenging period of the last 18 months, we at ICICI Bank have continued to strengthen our franchise and delivery and servicing capabilities with a range of digital initiatives. Our loan portfolio has performed well in the face of challenges posed by the two waves of the pandemic, behaving either in line, with, or better than our expectations. We aim to create holistic value propositions for our customers through a 360-degree customer-centric approach and focus on opportunities across client and segment ecosystems. Cross-functional teams have been created to tap into key customer market segments, enabling 360-degree coverage of customers and increase in wallet share. We will continue to steadily grow our business and franchise within our strategic framework.Coming to the quarterly performance against this framework, growth -- number one, growth in the core operating profit in a risk-calibrated manner through the focused pursuit of target market segments. The core operating profit increased by 23.3% year-on-year and 10.6% sequentially to INR 95.18 billion in this quarter. The profit after tax grew by 29.6% year-on-year and 19.4% sequentially to INR 55.11 in this quarter, further strengthening our strong deposit franchise. Growth in deposits continues to be strong at 17.3% year-on-year at September 30, 2021. During the quarter, average current account deposits increased by 35.7% year-on-year, and average savings account deposits by 24.9% year-on-year. The liquidity coverage ratio for the quarter was 133% reflecting continued surplus liquidity. Our cost of deposits continues to be amongst the lowest in the system. Growing our loan portfolio in a granular manner with the focus on risk and reward, the retail portfolio grew by 20% year-on-year and 5% sequentially at September 30, 2021. With the increase in economic activity, disbursements across all retail products increased sequentially in this quarter. Mortgage disbursements close to the levels seen in Q4 of 2021, reflecting the increase in demand coupled with a seamless customer on boarding experience through pre-approved offers and digitization. Disbursements of personal loans and auto loans were also close to Q4 of 2021 levels. Credit cards in force increased by 6% sequentially and the value of credit card spends grew by 47% sequentially. Spends across most categories other than travel crossed March 2021 levels in September. We expect the momentum in spends to continue in the festive season. The business banking and SME portfolio grew by 43.1% year-on-year and 42% year-on-year respectively. Sequentially, the business banking portfolio grew by 12.3% and the SME portfolio grew by 11%.We are observing a steady uptick in the number of credit inquiries and with our digital offerings and platforms like InstaBIZ, Merchant Stack and Trade Online. We believe that there is significant potential for growth across these portfolios. Excluding the builder portfolio, the growth in the domestic corporate portfolio was about 14% year-on-year at September 30, 2021. Overall, the domestic loan portfolio grew by 19% year-on-year and 4% sequentially. Leveraging digital across our business, our digital platforms are continuously evolving to enable best in class end to end seamless digital journey offer personalized solutions and value-added features to customers and enable more effective data-driven cross-sell and up-sell. These platforms also enable us to acquire new customers. We have shared some details in slide 18 to 30 of the investor presentation.We have seen significant increase in adoption of our mobile banking app iMobile Pay. There were about 1.5 million activations from non-ICICI Bank account holders in the current quarter, taking the total activations to 4 million as of end September. The transactions by non-ICICI Bank account holders in terms of value and volume respectively got 3 and 13 times higher in September 2021 compared to June 2021. We are seeing a rapid rise in payment transactions through repeat use of features such as Pay to Contact and Scan to Pay. We continue to expand the suite of services offered through iMobile Pay to achieve high engagement levels with the users. Recently, we launched a facility, which enables the saving account holders to manage use of credit cards of any bank through iMobile Pay. We also launched the contact less payment facility on iMobile Pay, which enables users of Android-based smartphones to make credit and debit card payments on POS terminals in a safe and secure manner by tapping their phones.The financial transactions on the digital platform for businesses InstaBIZ and our supply chain platform have grown steadily in the past few quarters. The value of financial transactions on InstaBIZ grew by about 80% year-on-year in Q2 of 2022. We have on-boarded about 200 corporate customers on our supply chain platforms, about 70% of the dealers of these, dealers of these customers are active on our supply chain platforms. The value of transactions, through these platforms, increased 4.7 times year-on-year in Q2 of 2022. The proportion of end-to-end digital sanctions and disbursements across various products has been increasing steadily. About 32% of our mortgage sanctions and 40% of our personal loan disbursements by volume were end to end digital in H1 of 2022. About 95% of the overdraft facility setup of business banking current account customers with end-to-end digital in H1 of 2022, 40% of asset and liability accounts opened during the quarter were through digital channels. An important element of our strategy to grow a risk calibrated core operating profit is to serve the complete financial requirements of customers and their ecosystems.The ICICI STACK for Corporates is being continuously enhanced. We have created 19 industry specific stacks, which provide bespoke and purpose based digital solution to corporate clients and their ecosystems. The volume of transactions through these solutions grew 2.4 times year-on-year in Q2 of 2022. These solutions along with the depth of our coverage have supported the strong growth in our average current account deposits. Further, the bank is well positioned to capture the opportunities arising from the growing FDI and capital market flows. We are focusing holistically on the merchant ecosystem both directly and through partnerships. Our super merchant current account, which offers various benefits such as digital account opening and instant overdraft facilities based on point-of-sale transactions has been receiving a good response from customers. We have partnered with Amazon India to offer instant overdraft to sellers including non-ICICI Bank customers on its portal. We have also launched an instant overdraft facility for MSMEs registered on the GeM Sahay application through API integration with the OCEN network, protecting the balance sheet from potential risks.Net NPAs declined by 12.3% sequentially to INR 81.61 billion at September 30, 2021 from INR 93.06 billion at June 30, 2021. The net NPA ratio declined to 0.99% at September 30, 2021 from 1.16% at June 30, 2021, the net additions to gross NPAs during the quarter were INR 0.96 billion. The total provisions during the quarter were INR 27.14 billion or 28.5% of core operating profit and 1.44% of average advances. The provision coverage ratio on NPAs was 80.1% at September 30, 2021. The total fund based outstanding to all standard borrowers under resolution as per various guidelines was INR 96.84 billion or about 1.3% of the total loan portfolio at September 30, 2021. The bank holds provisions of INR 19.50 billion against these borrowers, which is higher than the requirement as per RBI guidelines. In addition, the bank continues to hold COVID-19 provisions of INR 64.25 billion or about 0.8% of total loans as of September 30, 2021, maintaining a strong capital base.The capital position of the bank continued to be strong with the CET1 ratio of 17.33% at September 30, 2021 including profits for H1 of 2022. Further, the market value of bank's investments in listed entities of the Group is about INR 1 trillion. Looking ahead, we see many, many opportunities to grow our core operating profit in a risk-calibrated manner. Using ICICI STACK, we will create digital journeys and offer personalized and customized solutions to the customers to suit their life stage and business needs. We'll continue to build flexibility and agility in the Bank to tap into opportunities across ecosystems. We believe that our ongoing investments in technology, people and distribution network, our prudent risk management practices and a strong balance sheet will enable us to drive growth in our core operating profit in a risk-calibrated manner. We continue to be guided by our philosophy of Fair to Customer, Fair to Bank, emphasizing the need to deliver fair value to customers, while creating value for shareholders. We'll continue to focus on delivering consistent and predictable returns to our shareholders.I now hand the call over to Rakesh.
Thank you, Sandeep. I will talk about the balance sheet growth, credit quality, P&L retail, capital adequacy, portfolio trends and performance of the subsidiaries. Starting with the balance sheet growth, the overall loan portfolio grew by 17.2% year-on-year and 3.6% sequentially at September 30th. The domestic loan portfolio grew by 19% year-on-year and 4% sequentially at September 30th. The retail portfolio grew by 20% year-on-year and 5% sequentially. Within the retail portfolio, the mortgage loan portfolio grew by 25% year-on-year and rural loans and auto loans by 16.1% each. The commercial vehicle and equipment portfolio declined by 5% year-on-year. Growth in the personal loan and credit card portfolio was 20.7% year-on-year. This portfolio was INR 724.16 million or about 9.5% of the overall loan book at September 30th. The business banking portfolio grew by 43.1% year-on-year and 12.3% sequentially. The SME business comprising borrowers with a turnover of less than INR 2.5 billion, grew by 42% year-on-year and increased by 11.3% sequentially. The growth of the domestic corporate portfolio was 11.5% year-on-year, excluding the builder portfolio, the growth was about 14% year-on-year. This was driven by disbursements to higher-rated corporates and PSUs across various sectors to meet their working capital and capital expenditure requirements. We are focusing on providing the full suite of banking products to corporate clients and their ecosystems. The overseas loan portfolio declined by 8.6% year-on-year and 3.5% sequentially at September 30th. The overseas loan portfolio was 5.1% of the overall loan book at September 30th. The non-India linked corporate portfolio reduced by 56.9% or about USD1.1 billion year-on-year and 15.9% or about USD154 million sequentially at September 30th. We have provided the breakup of our overseas corporate portfolio on Slide 16 of the presentation.Coming to the funding side, average savings account deposits increased by 24.9% year-on-year and 4.3% sequentially. Daily average current account deposits increased by 35.7% year-on-year and 4.6% sequentially. Total term deposits grew by 12.5% year-on-year to INR 5.3 trillion at September 30th. Coming to credit quality, net NPAs declined by about 12.3% sequentially to INR 81.61 billion at September 30th from INR 93.06 billion at June 30th. The net NPA ratio decreased to 0.99% at September 30th from 1.16% at June 30th. The net addition to gross NPAs was INR 0.96 billion in the current quarter compared to INR 36.04 billion in the previous quarter. There were net deletions dilutions of INR 5.54 billion from gross NPAs in the retail and business banking portfolios and net additions of about INR 6.5 billion to gross NPAs in the corporate and SME portfolios. The gross NPA additions declined to INR 55.78 billion in the current quarter from INR 72.31 billion in the previous quarter. The gross NPA additions from the retail and business banking portfolio were INR 46.24 billion and from the corporate and SME portfolio were INR 9.54 billion. The gross NPA additions from the corporate and SME portfolio were almost entirely from borrowers rated BB and below as of June 30th and devolvement of non-fund-based outstanding to NPAs.The recoveries and upgrades from NPAs, excluding write-offs and sale, increased to INR 54.82 billion this quarter from INR 36.27 billion in the previous quarter. There were recoveries and upgrades of INR 51.78 billion from the retail and business banking portfolio and INR 3.04 billion from the corporate and SME portfolio. The recoveries and upgrades in the current quarter include upgrades of INR 11.67 billion, where resolution was implemented as per the RBI's framework. The gross NPAs written-off during the quarter were INR 17.17 billion. The bank sold gross NPAs amounting to INR 0.9 billion in Q2 on a cash basis. The non-fund based outstanding to borrowers classified as non-performing, was INR 37.14 billion at September 30th, compared to about INR 41 billion at June 30th. The bank holds provisions amounting to INR 17.71 billion at September 30th, on this non-fund-based outstanding. The outstanding to all borrowers, where resolution was implemented as per COVID-19 framework 2.0 was INR 41.58 billion. The outstanding to borrowers where resolution was implemented as per COVID-19 framework 1.0 and later modified as per framework 2.0 was INR 1.18 billion. The total fund-based outstanding to all standard under resolution as per various guidelines, was INR 96.84 billion or about 1.3% of the loan portfolio at September 30th, compared to INR 48.64 billion at June 30th. Of the total fund-based outstanding under resolution at September 30th, INR 69.92 billion was from the retail and business banking portfolio and INR 26.92 billion was from the corporate and SME portfolio. The bank holds provisions of about INR 19.5 billion against these borrowers, which is higher than the requirement as per RBI guidelines. Over 95% of the loans under resolution in the retail and business banking portfolio are secured loans. Till the last quarter, we disclosed the rating wise breakup of the total loan book, wherein the retail loan portfolios were grouped under various categories at the product level. Based on feedback received, from this quarter, we have disclosed the rating wise details of the non-retail portfolio, comprising domestic corporate, SME, business banking and overseas advances in order to provide a more transparent presentation of the rated portfolio. The details are given on Slide 38 of the presentation. The proportion of overdues across most products in the performing retail, SME and business banking portfolios as of September 30th has reduced compared to June 30th and has reached the March 2021 level, less than 1% of the performing corporate portfolio is overdue as of September 30th.Coming to the P&L details now, net interest income increased by 24.8% year-on-year to INR 116.9 billion. Interest on income tax refund was INR 0.3 billion this quarter compared to INR 0.14 billion in the previous quarter and INR 0.26 billion in Q2 of last year. The net interest margin was at 4% in this quarter compared to 3.89% in the previous quarter and 3.57% in Q2 of last year. The domestic NIM was 4.09% this quarter compared to 3.99% in Q1 and 3.72% in Q2 last year. International margins were at 0.26%. The cost of deposits was 3.53% in Q2 compared to 3.65% in Q1. The sequential increase in NIM in this quarter was primarily due to decline in cost of funds and lower interest reversal on NPAs. Non-interest income, excluding treasury income, grew by 26.2% year-on-year to INR 44 billion in Q2. The fee income increased by 21.4% year-on-year to INR 38.11 billion in Q2, fees from retail, business banking and SME customers grew by 24.6% year-on-year and now constitutes about 77.9% of the total fees during the quarter. Dividend income from subsidiaries and listed entities was INR 5.83 billion in this quarter compared to INR 3.34 billion in Q2 of last year. The dividend income this quarter includes final dividend of ICICI General and higher final dividend from ICC securities compared to Q2 last year.The Bank's operating expenses increased by 28% year-on-year in Q2, reflecting the lower base of Q2 last year. The employee expenses increased by 21.2% year-on-year, the bank had slightly over 100,000 employees at September 30th. The employee count has increased by about 8,000 in the last 12 months. Employee expenses in Q2 include an impact of about INR 1.25 billion due to fair valuation of ESOPs granted to all employees post April 1, 2021, for the current and previous quarters as required by the RBI guidelines. Non-employee expenses increased by 32.3% year-on-year in this quarter, primarily due to retail business and technology-related expenses. We will continue to invest in technology, people, distribution and building our brand. The core operating profit as a result of the above, increased by 23.3% year-on-year and 10.6% sequentially to INR 95.18 billion in this quarter.The treasury gain was INR 3.97 billion in Q2 compared to INR 2.9 billion in Q1 and INR 5.42 billion in Q2 of the previous year. The total provisions during the quarter were INR 27.14 billion or 28.5% of core operating profit and 1.44% of average advances. There was no write-back of COVID-19 related provisions during the quarter. The provisioning coverage on NPAs continues to be robust at 80.1% at September 30th. In addition, we hold INR 19.5 billion of provisions on borrowers under resolution and COVID-19 related provisions of INR 64.25 billion. The COVID-19 provisions are about 0.8% of loans. At September 30th, the total provision other than specific provisions or NPAs were INR 149.51 billion or about 2% of loans. Given the performance of the portfolio, we are confident that these provisions will completely cushion the balance sheet from the potential credit losses, which may arise due to the pandemic.The profit before tax grew by 36.7% year-on-year to INR 72.01 billion in this quarter compared to INR 52.66 billion in Q2 of last year. The tax expense was INR 16.9 billion in this quarter compared to INR 10.15 billion in the corresponding quarter last year. The profit after tax grew by 29.6% year-on-year to INR 55.11 billion in this quarter compared to INR 42.51 billion in Q2 of last year. In accordance with the scheme of arrangement between ICICI General and Bharti AXA General Insurance, assets and liabilities of Bharti AXA General Insurance business vested with ICICI general on the appointed date of April 1, 2020. The bank's consolidated financial statements for Q1 of this year have been restated to reflect the scheme and there was no material impact on the consolidated profit after tax for Q1 due to this. The consolidated profit after tax was INR 60.92 billion this quarter compared to INR 48.82 billion in Q2 of last year. On capital, the CET ratio, including profits for H1 was 17.33% compared to 17.01% at June 30th. The Tier 1 ratio was 18.53% and total capital adequacy ratio was 19.52% at September 30th.Coming to some portfolio details. We have been growing our loan portfolio in a granular manner with a focus on risk and reward. Our retail portfolio has been built based on proprietary data and analytics in addition to bureau checks, utilizing the existing customer database or sourcing in key retail asset products through cross-sell and upsell and pricing in relation to the risk. In the business banking and SME business, our focus is on parameterized and program based lending, granularity, collateral and robust monitoring. Credit submissions in the overdraft accounts of business banking and SME customers have continued to grow consistently in this quarter and reached March 2021 levels in September. We have given further information on our retail and business banking portfolios in Slides 37 to 47 of the presentation. The loan and non-fund-based outstanding to performing corporate and SME borrowers rated BB and below was INR 127.14 billion at September 30th, compared to INR 139.75 billion at June 30th and INR 119.29 billion at September 30, 2020. The details are given on Slide 39 and 40 of the investor presentation.Similar to the last quarter, other than three accounts, which are one each in construction, power and telecom sectors, the maximum single borrower outstanding in the BB and below portfolio was less than INR 6 billion at September 30th. At September 30th, we held provisions of about INR 9.6 billion on the BB and below portfolio compared to about INR 9.76 billion of provision at June 30th. The builder portfolio, including construction finance, lease rental discounting, term loans and working capital loans was INR 228.14 billion at September 30th or about 3% of our total loan portfolio. Our portfolio is granular in nature with a larger exposure being to well-established builders. About 13% of our builder portfolio at September 30th was either rated BB and below internally or was classified as nonperforming.Coming to the subsidiaries and key associates. The details of the financial performance of subsidiaries and key associates are covered in Slides 51, 52 and 71 to 76 in the presentation. The new business premium of ICICI Life grew by 45% year-on-year to INR 64.61 billion in H1. The VNB margin increased from 25.1% in FY2021 and 27.3% in H1. The profit after tax of ICICI Life was INR 2.59 billion in H1 compared to INR 5.91 billion in H1 of last year. ICICI Life had a net loss of INR 1.86 billion in Q1, primarily on account of COVID-19 claims and provisions made for incurred but not reported claims. The profit after tax increased by 46.6% year-on-year to INR 4.45 billion this quarter. The gross direct premium income of ICICI General was INR 86.13 billion in H1 this year compared to INR 64.91 billion in H1 last year. The combined ratio was 114.3% in H1 compared to 99.8% in H1 last year. The profit after tax was INR 4.46 billion this quarter compared to INR 4.16 billion in Q2 last year. The prior period numbers are not comparable due to the reflection of the scheme of arrangement in the current period numbers. The profit after tax of ICICI Asset management company was INR 3.83 billion in this quarter compared to INR 2.82 billion in Q2 of last year, reflecting the growth in AUM. The profit after tax of ICICI Securities on a consolidated basis increased by 26.3% year-on-year to INR 3.51 billion this quarter from INR 2.78 billion in Q2 last year.ICICI Bank Canada had a profit after tax of CAD8.4 million in this quarter compared to CAD5.1 million in Q2 last year and CAD5 million in the previous quarter. The sequential increase in profit after tax of ICICI Bank Canada is mainly due to lower loan loss provisions. The loan book of ICICI Bank Canada at September 30th declined by 8.8% year-on-year. ICICI Bank UK had a profit after tax of USD2 million this quarter compared to USD4.9 million in Q2 of last year and USD2.9 million in Q1. The loan book of ICICI Bank UK at September 30th declined by 28.9% year-on-year and 8.8% sequentially. During the quarter, ICICI Bank UK repatriated capital of USD200 million to the parent bank. As per Ind AS, ICICI Home Finance had a profit after tax of INR 0.46 billion in the current quarter compared to INR 0.02 billion in Q2 of last year and INR 0.17 billion in the previous quarter. The sequential increase in profit after tax is mainly due to lower provisions.With this, we conclude our opening remarks, and we will now be happy to take your questions.
[Operator Instructions] The first question is from the line of Mahrukh Adajania from Elara Capital.
My first question is on provisioning policy. So was there any calculate of provisioning quality this quarter two?
No, there is no change in provisioning policy that we have done during this quarter.
Okay. And just in terms of restructuring, what would be the tenor of moratorium? How much moratorium on an average on retail loan?
It would vary across the products, but maybe typically, you can say about a year or so.
Got it. And just within restructuring, you've said that 95% is secured assets, but it would follow the loan composition, right? So it would be a higher proportion of mortgages. Would that be fair or...
Yeah. So the restructuring, it is Mahrukh spread across the portfolio. So indeed, there will be the mortgage portfolio, commercial vehicles, as you know, that is -- that will be there, some amount of car loans, smaller amounts of business banking. So it's spread across, there's nothing specific to highlight on that.
Got it. Got it. And my last question is on loan growth. So of course, you've achieved very good loan growth. And from third quarter, which are very high, the Bank will get a very high base as well. But given the loan demand that you see and given the under-penetration in your own liability account, would a 6% to 7% sequential growth be possible over the next few quarters?
Mahrukh, as we have said, our focus is on growing the risk-calibrated core operating profit. I think loan growth is one of the drivers, which is there. And depending on the overall demand, which is there, the risk that we perceive, the pricing which is there, we will look at the growth numbers. So clearly, there is momentum that is there. And you are seeing that in the sequential growth, if you look at business banking, SME, retail, a lot of initiatives taken also in terms of -- on the digital side on easing the customer onboarding process, the underwriting process. All of that is helping in this. On the corporate side, again, we get to look at all the deals which are there in the market, but you know the market is pricing loans in a certain way given the surplus liquidity. So our focus there, for example, is a lot more on the entire corporate ecosystem and looking at the core operating profit that we can generate and not just the loan growth. So we would not want to comment on any specific sequential growth numbers based on the opportunities, which are there for us to increase our operating profit, we will grow.
Sure. And any comment on corporate CapEx visibility?
I'll ask Vishakha to just...
Yeah. So not really Mahrukh, I will look at the CapEx and two, of course, the private corporates and the PSUs and the government. So on the private corporate side, certain segments, yes, but not really in a big way. People are spending money on the capital expenditure, more to balance the capacities and so on and so forth. But we see a good traction on the PSU and the government side.
The next question is from the line of Prakash Kapadia from Anived Portfolio Managers.
Yes. Congrats on a good set of numbers. I had two questions. Over the last few years...
Mr. Kapadia, sorry to interrupt, but your voice is breaking up. May we request you to move to a better reception area please.
Yeah. One second. Is it better now?
Yes, sir.
Yes. I was asking you, over the last few years, we've been focusing on cross-selling to grow our existing customers, taking feedback on every transaction on the Internet. So if you could give us some sense, where are we in the cross-sell journey as on date and something on assets and liabilities, where is more headroom for growth? And secondly, on mortgages, it's been doing pretty well as a sector, so what are the trends we are seeing? Is it restricted to top 10 cities, is it across India, and do we expect the momentum to continue?
Anup, do you want to take that?
So I think it's a very interesting question, Prakash. So the way we look at it and the way we do things is that. If you look at the sheer number of customers, on the asset side will always be lower because mortgage ticket has a very large automotive, et cetera. However, there is another set of customers who are coming on to us, who are not deposit customers, but who are also not asset customers. They are essentially payment and service customers, namely FASTag is one, iMobile Pay is another big source, our credit card page, another big source. So now what is happening is that there is a steady inflow of customers we are getting, who are non-assets and non-liability customers. They are essentially coming for services. So that then becomes a big source of liabilities for us. So you can cost the liability accounts to them. And then, of course, customers who are not our customers and who have taken assets, we then cross-sell liability to them. But I must say that the reverse is a lesser number, that is asset to liabilities. Services to liabilities is a very large number. Services to assets is a smaller number. Liabilities to assets is a very large number. Assets to liabilities is a relatively smaller number ticket prices. But all of them, as you would appreciate, is interlinked because if one is not there and then if you don't do 360-degree of each of the customers, who come in through the door. So then it's an opportunity that we would not have captured fully. So that's how we think about cross-sell.
And some of these -- Anup, you mentioned about being more on service-oriented or transaction oriented, so what's the journey for them to cross-sell, get them into the bank, then get to other products in terms of cross-sale that with smaller products?
So for example, let me take an example of FASTag, for example, FASTag, as you know, we have a dominant market share there. But all customers of FASTag are not ICICI Bank deposit customers. Many of them are, but many of them are also not ICICI Bank deposit customers and so, it is easier to sell deposit accounts to them. And once they become deposit account holders and we have more digital footprint, then we do preapprove to them and then we sell asset products. So I'm just giving you another dimension. So generally, typically, traditionally, banks think of only asset to liabilities, liability to asset, I'm just adding a dimension of services also because that flow is a much larger flow than just liabilities or just assets.
Understood. This is helpful. Thanks. And on the mortgage piece, if you could give us some color.
So mortgage piece, what would you want to know? Mortgage, I think there is enough demand. I think it is coming back quite strongly. The other thing that is happening on the corporate real estate developer side is that after RERA and whatever has happened volatility in the last few years, I think it is strengthening and it is consolidating quite well. And if you look at market shares of large developers, they have been increasing, and that has been our view now since last one year or so and it is consolidating well and we are also consolidating our position there. I think it's the right time to really focus on that ecosystem. And as you know that ecosystem, which is a physical asset, real estate asset class, it's a very, very large asset class. It's an asset class, which will perhaps be larger than the full financial asset class. So there is a lot of opportunity and a lot of scope there as well. So there, we have our 360 strategy firmly in place, and there is demand. And of course, there is competitive pricing there, as you know, because it's a low loss given default product. And so there's a lot of credit flow in that. But there the decongested processes and our ability to cross-sell to our old customers and our ability to do 360 gives us an advantage over many others.
The next question is from the line of Abhishek Murarka from HSBC.
Yeah. Hello, good evening and congratulations for the quarter. So a couple of questions. Just going back to slippages in retail. That's still about 4%, 4.5% on an annualized basis. So just want to know where particularly is it coming from, of course, all sectors are not recovering at the same rate. So is it the contribution from commercial vehicles is higher or where particularly it's coming from?
Yes. Abhishek, I think like we have said earlier also, on the retail business, I think one has to look at the net additions also, because a lot of the gross additions that you see, they get recovered or upgraded in the same quarter also. So of course, this quarter, the recoveries and upgrades are much higher than usual, partly reflecting the fact that Q1, we had very high additions. But to say, on an overall basis, the numbers that we have seen in the current quarter on retail, rural, business banking, SME, they have pretty much been in line with our expectation. And across portfolios, if you look at it, I think we have pointed out in the past that commercial vehicles is one segment, where the stress has been there even prior to the COVID period and over the last 18 months, that has kind of continued. Otherwise, I think across portfolios, if you look at the additions and deletions, it has been a reasonably stable trend. And the good thing is that the overdues on the portfolio also, which I mentioned earlier, they have now come back to the March '21 level. In June, they had got again elevated because of the second wave. So the overdues have also come down across, again, in retail and the business banking portfolio.
Sure. And just continuing that, so I know you said on restructured that it's again sort of proportionate to the loan book. But last quarter, for instance, you had highlighted that housing, LAP, gold, those segments had seen relatively higher restructuring. Would it be fair to say that it's the same kind of concentration this quarter in your restructured also?
No, so last quarter, actually, the gold loans was -- or the loan against gold, maybe that was -- we had seen a higher amount of NPA additions in Q1, because of the challenges on the collection side. And this quarter, actually, we have seen a fair bit of recoveries coming in from that portfolio. So again, on the restructuring, if you look at it, where we have implemented the COVID 2.0, the aggregate number itself is only INR 40 billion. So that is spread across, there is some in home loans within that, yes, LAP will be there, commercial vehicle, auto and a little bit in SME and business banking. So nothing really concentrated there, Abhishek, to kind of point out.
Okay. And just from a looking forward perspective, this overall slippage rate of 3%, 3.5%, how long before it, let's say, hits 2% kind of run rate? Are you seeing that kind of recovery in the economy, where you can think that maybe two quarters down the line or three quarters down the line, you'd be trending towards a normalized slippage rate?
So again, if we, for a moment, keep aside, the pandemic and the third wave and all of that, I think we are heading in a direction, where it should get to a normalized level. I think the indicator for that is always, if you look at the overdue book, if it is higher than normal, you would expect slippages to be also higher. And I think the overdues have come down to us -- for us and down to the March '21 levels, which were pretty close to a normal level as well. So I think we should start seeing that. Again, I would request you to look at on the retail side, there is a fair bit of addition, deletions and all that happen, so from that perspective, I think we should get to a normal level pretty soon.
Sure. And just second question on NIM, just anything in terms of what should be the read-through going forward, because your composition of relatively higher yielding products would continue to increase, looking at the growth rates. So do you see further uptick from 4%, 4.1% levels?
I think, I think last quarter I said that we would try and protect our NIM at the level at which it was in Q1, which had seen a sequential increase. This quarter, definitely, the fact that the net NPL additions are pretty much negligible, has helped because interest reversal and all of that is not there, plus because of the NPA deletions, you kind of collect interest, which was not booked earlier. So that has helped in the current quarter. So I think if you look at more, the H1 NIM, which was at about 3.94%, I think our endeavor will be to protect the margin at those levels. I think the moving parts are definitely the competitive intensity, which is there across all the segments of lending. As you would have seen, we have really not been price leaders across any of the products or segments. But yes, we would kind of bring down our prices, if required, based on what we are seeing in the market. The cost of deposits has really been something, which has helped us in improving our margins. Even in this quarter, we saw a 12 basis point decline in the cost of deposits, driven by the 35% growth in daily average current account deposits, 25% growth in savings account balances. So these are the variables, which are there. Overall, of course, the interest rates will inch up as RBI kind of normalizes the liquidity in the system. So how the repo rate moves and the funding cost moves, all of those will be variables, which will come into play maybe towards the end of the year or in the first half of second year. We will be focused on pricing our loans appropriately to get the required returns.
The next question is from the line of Nitin Aggarwal from Motilal Oswal Securities.
Yeah. Hi, good evening and congratulations on good results. So firstly, like while our mortgage growth has been quite strong, but just to understand if you are seeing any impact on growth in the metro and the Tier 1 cities, as other banks are now competing aggressively on rates?
So on rates, as I said, where we believe that from an overall perspective, and we look at and we have talked about the fact that we look at Customer 360, so we don't look at just a single product. In most of the instances, now when we give out a home loan, we also have the customer opening their savings deposit with us and this is true across all the products. So the Customer 360 is a very key thing for us. And similarly, looking at the entire ecosystem, be it a corporate ecosystem or any other ecosystem that we focus on. So we look at it on an aggregate basis and the contribution to operating profit again on an aggregate basis. So you would, you have seen the volumes that we have been able to do on the mortgages in this quarter, the Y-O-Y growth, the sequential growth both reflect that. So there are opportunities for growth, which is there. We will, of course, not go completely bottom fishing in terms of the rates which are there. But yes, the headline rates for us also, we have brought down with some of the competition, bringing it down. But overall, with the cost of funding being where it is, and the fact that mortgage customers are city customers, give us the opportunity to service them across a wide range of products and services over a long period of time. With that, we are comfortable with the profitability levels and would continue to look at growth in this segment.
On the -- Rakesh, on the card side, like we have been reporting a very strong market share gains and card spending has come back. But how, in general, has the asset quality been trending, how's the like customer behavior in that space? And if you were to benchmark yourself on profitability in this segment, because this is like one of the high-yielding segments, and we are doing very well here. So to benchmark ICICI Bank, say, in the industry, where will we be in this space on a scale of 7 to 10, anything that you can indicate, any qualitative flavor.
So credit cards is, again, an important product like mortgage is a long-term product, credit card is a product, which is used frequently by the customer, so you kind of end up getting an opportunity to service the customer on an ongoing basis, so it's a clear focus area for us, and Anup has talked about it in the past as well. The tie-up that we have with Amazon has really worked well for us. In terms of growth, again, you have seen the growth that we have seen in the cards in-force book or the credit card spend and the market shares have also improved for us. In terms of profitability, again, it's not that we have the numbers of all the players in the market. So difficult to comment in terms of -- on a comparative basis. But credit card is always a portfolio, where the returns have been pretty good. And if you look at the experience in the last 18 months through the COVID period, the numbers in terms of NPA additions or credit losses given the pandemic have actually clearly been, clearly been better than what we would have expected. So those are the trends, which are there.Anup, you want to add something?
No. I think, it's fine.
Sure. And lastly, like, if you can also comment on the performance of ECLGS portfolio, how has been the collection efficiency trend in this portfolio and for loans, which are out of moratorium?
So I would say something similar to what we said in the last quarter's call. So overall, our focus while implementing this scheme was to restrict ourselves to customers, who we thought -- where the business models are not broken, and we would have the ability to recover on these loans. So overall, that means that it's not a portfolio, where we are overly worried. But indeed, some of the customers under ECLGS would have been customers, who would have had stress. Relatively, it would be higher than on the rest of the portfolio, so there could be NPL additions, which could be somewhat higher than the rest of the portfolio. But we don't think that it is going to be anything which is material. We have about close to INR 140 billion of loans under the ECLGS-1 scheme, about INR 20 billion on the EC LGS-2 scheme and we are quite comfortable with what we are seeing in terms of the trend there.
[Operator Instructions] The next question is from the line of Anand Dama from Emkay Global.
Yeah. Thank you for the opportunity. Sir, my question is on restructured portfolio. So one, is there any residual pipeline in terms of restructuring that we will have? And secondly, you have made somewhere about 20-odd percent provision on restructured portfolio. So any guidance that you can give in terms of what will be relapse rate in the restructured portfolio and because of which you need to make some additional provision on the restructured portfolio beyond the 20% that we've already made.
Yeah. Anand, I didn't get your second part of the question well, but I'll answer if I miss something, then just let me know. On the pipeline, as per the RBI guidelines, the request had to be received by 30th of September, so which has happened, there would be some cases, which would still be under implementation at 30th of September, as you know these are retail loans, and it does take some time for all of that to get implemented. So there would be some amount of restructuring increase one we'll see in Q3. But in the overall context, it is not going to be any material number, I would say, it will be definitely, for example, less than INR 10 billion. So that is what is there in terms of the pipeline. On the provision, the -- there is an -- RBI requirement was to take about 10% provision on the COVID restructured loan. Against that, we have taken 15% provision. Some of the loans, which have got restructured were NPA and have got upgraded due to restructuring in those loans, we have carried forward the provision, which was made when they became NPA. So that's the reason we have overall about 20% provision on the restructured portfolio. As I mentioned earlier, it's predominantly secured portfolio, which has got restructured. So we would expect to recover and collect on these. But it's something that we will assess on a quarter-on-quarter basis, at any point of time, we believe there is higher provision requirement, we would be happy to make that. One should also consider that we, any case, have INR 64.25 billion of COVID-related provisions as well. If you look at the numbers that we have put in our release, where is that the RBI requirement for disclosure. So the slippages from the restructuring done last year, they have not been material in the first half of the year. Of course, some of those loans or actually many of those loans would still be under moratorium, like I said earlier, moratorium is anywhere between 6 months to 12 months. So we'll continue to assess this portfolio. If required, we will make some more provision. But overall, the provisions are quite comfortable at the bank level. And this quarter, in any case, we have not even utilized or written back any of the COVID provision.
That's very comforting. Second question is about the ICICI PayLater. So there is a lot of buzz about the NPL, we are also a dominant player in that space. Is it possible for you to give some trend in terms of how that is playing up? The ICICI Amazon Card has done very well, so if you can provide some numbers in terms of your ICICI PayLater.
So the numbers, I don't think we have provided. But see, the whole spectrum of credit in this space is becoming very, very interesting. So you have normally the credit card, which is a fantastic instrument, a very flexible instrument. Then, of course, you have the EMI, you can have EMI on debit card, you can have EMI on credit card. You can have normal now BNPL, which is coming in, essentially, these are also installment products. But the difference between BNPL and other products is that it is essentially driven by merchants. And so there is implicit promise to the merchants that if you give BNPL, the average order value will increase. And so the cost to the merchant is higher than sometimes the credit card MDR that they give out. And then there is a formation between. Our pay later is -- so we have a good spectrum of affordability products. Our PayLater also is one of the products, credit card being other products, our EMI on debit card, we have a product, EMI on credit card we have the product. So from our perspective, as a bank, because we have got flexibility of instruments and a full spectrum, we would want to certainly be there in all spectrum, depending on what customers want and how merchants want. We should be able to provide them all the options that they have.The good thing that has happened in the last, I would say, three years particularly is that the whole merchant ecosystem has become very, very digital. Right from the onboarding to their now UPI has come in, which is virtually zero MDR, so you can have EMI based on -- so credit product based on that as well. So what has happened is that it has become very digital and so the cost of onboarding has come down, the cost of reconciliation has come down, the cost of credit delivery has come down. So net debt, which is why you will see that this area of merchant ecosystem is really, really exploding in a very big way. And banks like us large banks like us, we have a natural advantage to play that game, because we already have a large sort of cost footprint, we have a large merchant footprint from a current account perspective. We see a lot of flow happening through us and so digital underwriting is what we can do, digital onboarding is what we can do quite easily. So actually, it's an interesting space, which is unfolding. But BNPL is a form factor of credit delivery. And we look at it that way. It's not a completely new product in the market. It has been there in various shapes and forms, but BNPL, of course, has its own advantage in the sense that it also caters to our need of a customer. They may not be having credit cards or they will not be having a lot of Bureau Score and these underwriting are on the fly. So it's a good form factor, and it's a good product for many, many customers. Our PayLater also is positioned well. And the other thing about many of these affordability products is, it is at the place of purchase, and it is not -- you don't have to go outside to take the loan, unlike personal loans, et cetera. It is at the time of purchase, so this embedded finance is a new thing, which is -- it's not a new thing exactly, I mean credit card was always there. But in a new way, it is coming. So I think the space is interesting.
Yes certainly, so basically, I think the acceptability among the customers certainly has gone up. So is it to some extent, cannibalizing on a low-value credit card spend, which was a...
No, we haven't seen that as yet. We haven't seen that as yet. So from an affordability perspective, so there are two things. One is that, first, you have to ascertain the underwriting of the customers. So once that threshold is reached, whereas there is a return on capital is by, I will not say assured, but you have a high confidence on return on capital, then the next immediate thing is a very, very decongested and easy process. Because if you have a very difficult process, customers will not take credit, they will take some other route to take credit. So if one can have a very, very good onboarding process, a credit delivery on the fly credit delivery process and you take care of the headache of the merchant, that is they get the money, they get the settlement and then you take over the settlement later by of postponed cash flows from the consumers and you make that process completely seamless. You can give it any name, you can give it revolver, you can call it BNPL. Everything is BNPL actually, credit card is also BNPL, Buy Now Pay Later. Now, there is a new word BNPL. So -- so but one has to make that a very, very good customer experience. Also, from a business who are new to credit customers, if they are your own customers, which banks have, because they have salaried accounts, so they are new to credit customers, you can underwrite them well. So there is also an added advantage that banks have, provided one has a very, very decongested on the fly underwriting process and ability to integrate with the merchant in a very, very seamless way. So that's really the value to the ecosystem that the product and service should give. Given that, demand for credit we have seen is always there. So it gets picked up then.
The next question is from the line of Shagun Verma from Goldman Sachs. Please go ahead.
Hi, this is Rahul here. Just two, three questions. One is on the non-employee cost, it's been pretty sharp spike this quarter. So just wanted to understand how do you see what's kind of driving this? I understand business momentum has picked up so that, that cost may have started coming through. But apart from that, is there anything else that we should know like on the digital side, technology side, how is the spend trending there? And also this partnership based spends, on the Big Billion Day, et cetera. So can you just throw some color on that?
Yes. Rahul, so if you look at the employee expenses were up about 21% on a Y-o-Y basis. We have seen about 7% to 8% increase in the number of employees on an average last Q2 to this Q2 and some increase in the salaries, all of that together, along with the ESOP costs that came in this quarter would account for that increase.On the non-employee expenses, there's clearly two sets of categories. The category which is growing is virtually all, which is linked to business, so that would be, of course, the technology-related costs, the retail business sourcing related costs, we have been buying a fair bit of priority sector lending certificates as well. That cost has gone up. Like you mentioned, sales and advertisement, promotion, those costs have gone up. So all of these are costs, which are we believe productive good costs to improve and increase our core operating profit. The other costs, more of administrative and infra kind of costs, those have grown in single digits actually this period. One thing to keep in mind is that if you look at last year, Q2, Rahul, we had about a 5% decline in our operating expenses, so the base for us was indeed much lower last Q2, so some bit of that impact is as well there. Having said that, clearly, in terms of the expenses that is there, we are at a 20% or thereabouts, kind of a run rate on expenses, where we are currently running. And that's the trend, in the absolutely near term, which one is seeing.
Okay. And then, Rakesh, just to put simply, I mean, if you were to look at this cost from, let's say, growth-oriented cost or maintenance oriented cost. How do you all kind of view this, I mean, this cost is necessary from a go-forward basis?
So the way, Rahul, in the bank, we run it is that each of the businesses have a risk-calibrated core operating profit as a key metric. As part of that, expenses is one of the variable and each of the business teams then looks at it and there is always a trade-off, one can always end up with lower cost in the near-term if you kind of sacrifice a bit on the long-term growth opportunity. So that is something that we don't do. So some of these expenses are indeed, which are building franchise, maybe they will show results in 12-month, 18-month kind of time frame. But overall, we are committed to growing the risk-calibrated core operating profit. So the increase in expenses that we have, we will continue to work on improving our revenues also in line with that.Given the pandemic, actually, some of the numbers have been a bit up and down, like I said. So last year, some of the expenses were lower and this year, you will see the growth in expenses to be higher. I think from next year, one will see a slightly more normalized numbers, but it would still be a growth which is high on the expenses side.
So the cost-to-income ratio should then be in a narrow corridor is what I'm taking away. Is that a fair understanding?
That is something Rahul for you to take away. We don't focus on that ratio per share. I think for us, the entire focus is on the core operating profit. If we are growing that well, and that means cost-to-income ratio goes down 2%, goes up 2%, it's actually fine. In the longer term, definitely, we believe that we should be able to grow our revenues at a faster pace than expenses. But in the near term, there are some of these spends, which we will be incurring.
The next question is from the line of Prakhar Agarwal from Edelweiss. Please go ahead. Mr. Agarwal, your line is in talk-mode, kindly go ahead with your question please. As there is no response from the current participant, we move to the next question from the line of Adarsh Parasrampuria from CLSA.
Hi, yeah, just a question on the ROE expectation now, right, the last 12, 18 months was quite volatile. We're getting comfortable with credit costs and the operating profit trajectory has been quite strong. Any targets on ROE for the bank over the next two to three years?
Adarsh, as you know, we don't have any specific target communicated on the ROE. I think we'll repeat and our focus is to grow our risk-calibrated core operating profit. And if that happens, the ROE should improve. We have seen some improvement over the last 12 months, 24 months. And that could be the objective going forward as well. But there is no specific target that we have for ROE in our mind.
Okay. Rakesh, one question on the leveraging up of the balance sheet, right, that while the growth has been strong, our ROEs will kind of get there. So -- and we did raise capital into the pandemic, anticipating some issues, but the outcomes have been a lot better. So what's -- where do leverage go in the balance sheet in the next two to three years, because that -- given that the ROEs will go up, it doesn't look like we'll have a lot of leveraging up of the balance sheet.
That we will see, Adarsh, in terms of what the opportunities are, I think it's going to just be a function of what is the market opportunity. And within that, what fits into our risk and return criteria. I think we are at a very healthy level of capital. So that gives us confidence that we can capitalize on all the opportunities, which would come up. And we are pretty optimistic about the economy, about the opportunity for the banking system in the two to three-year time frame that you are referring to. Based on the opportunities, we'll see how the leverage goes up from the current level.
Okay. Thanks and congrats, being splendid, last two, three years.
The next question is from the line of Kochar Gaurav from Mirae Asset.
Yeah. Hi, good evening everyone. I have a few questions. Firstly, on margins, I mean, quarter-on-quarter, there was a 11 BPS improvement in margins. And if I look at the CD ratio, it has moderated further to 78%. So taking maybe a 4-quarter to 6-quarter view or a medium-term view, if maybe credit picks up and the CD ratio move towards 85% sort of mark, what is the outlook on margins? Also in that context, the share of unsecured credit right now is 10%, if I add up the personal loans and credit cards, any sort of target internally or any sort of cap that you would have built there? And maybe in next two years, I mean, what would this be as a percentage of overall portfolio? And as a result, what kind of margins can we look at from a 12 to 18-month or 2-year perspective? That's my first question.
No, it's a very dynamic market, very difficult to have a target on margins. I think at any point of time, we are always looking at literally first, protecting the margin and then seeing the opportunities to improve it. I think into the next year, something which all banks will face, including us, is that a lot of our loans are linked to external benchmarks, so we'll have to see how the repo rate moves, how the T-bills move. And with respect to that, how the cost of deposits move for banks. So that's an additional factor, which has come in with all the loans being linked to external benchmark. Otherwise, definitely, I think we are still sitting on surplus liquidity in the balance sheet, so as that gets deployed, over time, we would see some benefit on the margins from that side. On business mix, the unsecured portfolio had been growing at a faster pace than overall portfolio for us, prior to COVID and some bit of slowdown happened there in the pandemic period, and we believe we should get back to more normal levels of growth on that side. But we don't have any specific target of NIM in the 2-year period.
Sure, sure. But directionally, you believe this can go up further from here, the margins, given the levers.
In the medium term, we would always work towards that. It's going to be a function of a lot of things, and some of those are not under our control as well.
Sure, sure. Understood. And my next question is on the provisions. If I look at the on-book provisions of 80%, net NPA in corporate book is, I mean, almost INR 2,000 crores. PCR on retail book is 65%. And apart from that, we are also carrying provision buffers, I mean -- for FY '23, I mean, it's very hard to estimate a credit cost of more than 100 bps, unless, of course, we see a third wave, what are your thoughts around this and I mean, in this year or maybe next year, do we see some write-backs of this COVID buffer that you have made in the last 18 months or so?
Yeah. So in two parts, if I take it on the first one, we have said that through the cycle number that we look at on credit cost is for it not to exceed 25% of our core operating profit, which would be like 120 or 125 basis points of loans. So we should get back to that level once the pandemic is behind us, for sure, because that is what we aim for, while we build our portfolio. Regarding the COVID provisions, I think it's an assessment that we will keep on doing on a quarter-on-quarter basis. The portfolio, of course, has stood up better than what we anticipated, and the performance there has been better than what we would have taken into consideration while creating the COVID-related provision, but we are not going to be in a hurry to unwind all of those provisions. I think we'll assess it quarter-by-quarter, maybe at the year-end, we'll take a call as to how we should do that. It's something which gives strength to the balance sheet, so we don't overthink around that.
Sure. Sure. But the intent is to unwind it maybe at a later date, if not today, not to hurry up, but the intent is not to keep that buffer forever. If my understanding is right.
Yeah, meaning once the pandemic is over, then COVID-related provision will not be there, whether we maintain some of the provision, contingency provision, we will assess all of that.
Sure. Got it. Got it. And just -- I mean, on that ICICI Bank UK, I mean, I didn't hear it properly, but is the dividend payout $20 million or $200 million?
No, that was a capital repatriation of $200 million that we -- so it was surplus capital in the UK subsidiary. As I said, the loan book there has declined and their capital ratio was like 25%. So $200 million of capital was repatriated back to the parent bank during the quarter.
Okay. So this will not be part of the P&L, it will only be added back to reserves, is it?
It will not be added back to the reserves, it will come in the capital adequacy. Investment in subsidiaries reduced from the capital while computing capital adequacy, so that a number of deduction has come down. And in the balance sheet, it would have resulted in a reduction in the investment.
All right. Perfect. Understood. And just last question, if I can squeeze in. The liquidity -- the closing liquidity on the balance sheet was around INR 1.5 trillion. Is the average also around the same number or it's a quarter end phenomenon when the liquidity is high, typically?
For the average number, you should look at the LCR number that we also disclosed, that's a daily average number, so 130% or so. So it's clearly higher than where we would ideally want it to be.
Thank you. Ladies and gentlemen, due to time constraint, that was the last question. I now hand the conference over to the management for their closing comments. Over to you.
Thank you, everyone, for spending the Saturday evening with us. And we can take remaining questions separately. Thank you.
Thank you. Ladies and gentlemen, on behalf of ICICI Bank, that concludes this conference. Thank you all for joining us, and you may now disconnect your lines.