See net interest margin around 2-2.1% in FY12: IDBI Bank

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IDBI Bank has declared its third quarter. The bank's net profit was at Rs 410 crore versus Rs 454 crore on year-on-year (YoY) basis.

The net interest income (NII) was at Rs 1,060 crore versus Rs 1,193 crore (YoY).

In an interview to CNBC-TV18, P Sitaram, chief financial officer of IDBI Bank says, the net interest margin for the full year will be close to 2-2.1%.

Below is the edited transcript of his interview on CNBC-TV18. Also watch the accompanying video.

Q: For the quarter, what are your net interest income margins?

A: For the quarter, the NIM is 1.86%. For nine months, it is 2%. The comparative quarter last year is was at 2.42% and nine months was 2.11%.

Q: Can you give us a guidance of how much you think you will close the year at?

A: We are looking to close between 2-2.1% NIM for the full year.

Q: What about the loan book, how is that looking?

A: Loan book, we will be doing some of the priority sector in this Q4. So, taking that also into account, we should be having a growth of about 15-16% March-on-March.

Q: What about the gross NPAs, where do they stand at at this quarter and how do they compare on the quarter on quarter basis?

A: Gross NPA is 2.94%, as on December 2011. As on December 2010, it was 2.22% and the net NPA is 1.96% against 1.2%.

Q: Which are the sectors which have contributed to this change in the NPAs?

A: There has been some slippage across sectors. But, in particular, aviation sector has also contributed to this.

Q: Can you breakdown the aviation sector for us and tell us in detail about that, if you can elaborate a bit on it?

A: We had an aviation sector exposure, which has slipped into NPA. That has contributed to significant portion of addition to gross NPAs.

Q: What are the restructured assets that we have seen in Q3?

A: We have added at a net basis about Rs 700 crore. We had outstanding of about Rs 8,860 crore and it has moved up to Rs 9,522 crore.

Q: Can you give us an idea of the asset quality as well as the ones that have been restructured?

A: What we have restructured, out of that the majority is in the standard category. We had about Rs 82 crore, which was in NPA, which will continue to be NPA in the restructured.

Q: So that you think will stay the same even in Q4.

A: No, when we restructured a sub-standard asset, it will continue to be a sub-standard. We cannot upgrade that.

Q: What is your exposure to the MFI at the moment?

A: It is less than an Rs 1,000 crore. It's not very significant for us.