In an interview to CNBC-TV18, SS Mundra, chairman of Bank of Baroda spoke about the bank's likely performance in the March quarter and the road ahead.
Below is the edited transcript of the interview.
Q: Last quarter we saw a goodish bit of bad loans. Can we see any improvement in the fourth quarter or is there more of a bad assets that could have been created because of the slowdown?
A: It is a normal course of business. There is nothing like kitchen sinking. I did quite clearly indicated at the time of announcing the December quarter result that I see a challenging period of a quarter or two. Within that, we should be able to take stock of the entire situation. Then it should start improving. So I have the same thing to repeat here: the Q4 should be more or less in line with Q3. If Q3 was a reflection of the normal business position which was emerging, so will be the Q4. So there is nothing like that some catastrophe is happening or a kitchen sinking is happening.
Q: How is the bank placed on asset quality? How would Q4 have panned out in terms of slippages? Can we see it at that Rs 2,000 crore level that we saw in Q3 and what is the level of restructured assets?
A: I did say that a quarter or two would be the similar kind of thing. I would say slippages would be more or less something like we have already seen in Q3. But in terms of overall non-performing asset (NPA) percentage, it would remain around the level which it was in Q3.
Having said that, in the last two months, there has been a perceptible improvement in recovery performance. I believe that it will gather further momentum as we have already entered into this quarter and going forward.