Q: Provisions were up for Q2. Do you sense that some of the loan defaults might spill into second half of this financial year?
A: Much of the provisions that have come in the first two quarters are coming through in personal loans and partly in corporate loans. We have maintained very high coverage ratio both in unsecured personal loans and corporate. Our coverage ratio is at 69%. I expect the unsecured personal loan provisions to continue to be there of another 2-3 quarters after which it will start reducing significantly.
Q: DCB did indicate in its analyst meet last year that it is open to looking at strategic investors. In terms of cleaning up the balance sheet is that still on the cards?
A: The way I see it, we will be looking towards a few long-term investors instead of calling them strategic investors. There are two reasons for that. First it will take us about 6-9 months to come back to making month-on-month profit. And from that point onwards we will start making good progress in taking the bank to a very healthy balance sheet and growth level.
Second is AKFED, which had 26% odd stake as of March, needs to go down to 10% in next 3-4 years. So we are looking to get support of few long-term investors who would support our strategy and growth. That is our current plan.
