Karur Vysya expects to maintain asset quality ahead

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Karur Vysya expects to maintain asset quality ahead

K Venkataraman, managing director and chief executive officer, Karur Vysya Bank expects to maintain asset quality going forward.

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Excerpts from Midcap Radar on CNBC-TV18 Watch the full show » ALSO READ See latest News about Karur Vysya See previous management interviews See what other Experts & Brokerages are saying about Karur Vysya

K Venkataraman, managing director and chief executive officer, Karur Vysya Bank expects to maintain asset quality going forward.

Citing the bank's growth outlook to CNBC-TV18 Venkataraman said that doesn't see any problem as far as maintaining asset quality is concerned.

Karur Vysya which has a record of posting around 24-25% rise in earnings is hopeful of sustaining similar growth rate in the current fiscal and FY13.

Below is the edited transcript of Venkataraman's interview with CNBC-TV18. Also watch the accompanying video.

Q: Since asset quality is on the top of mind of all investors right now and given that you have posted a decent asset quality this time around - gross NPAs pretty stable so have the net NPAs do you expect to maintain this kind of a run rate going forward as well?

A: We expect to maintain the asset quality going forward. I do not expect any serious problem here.

Q: Historically, Karur Vysya has never had a problem with asset quality it is perhaps the best in industry. But would you expect that given the nature of the economy that might surface and you may have to provide a little more than you have done before?

A: I am not sure because in none of our SME units or short term units there are sector specific issues. Going forward a nominal NPA can come up. As it comes in to the normal course of business. I do not think economic slow down in any particular sector is going to be a problem for our NPAs.

Q: You don't have exposure to any state electricity board or any power companies?

A: We do have exposure to state electricity board. We have exposures to Tamil Nadu Electricity Board and with Punjab, Rajasthan, Gujarat. They are all okay because they have not faced any problems with us.

Q: How do you expect loan book growth in the second half? Will it mirror first half or will it mirror last year same time or do you expect some pressure in terms of volume of loans?

A: Volume of loans growth is slightly slower but as far as the power book is concerned, it is likely to go up.

Q: What kind of a margin picture will you be able to post in the second half, will you be able to maintain the 3.2 that you showed in the second quarter?

A: Yes, second quarter 3.1 we will be able to maintain the margin. We have been protecting our margins.

Q: You have a record of posting around 24-25% rise in earnings will you be able to post that in this current and FY13 as well?

A: That is what we are targeting for.