To maintain net interest margin at 3% in coming quarters: TFCI

Tourism Finance Corporation of India (TFCI) reported a total income of Rs 149 crore and net interest margin (NIM) improvement by 30 basis points (bps) to 3.89 percent in the third quarter of FY16. The company also raised bonds worth Rs 150 crore this quarter.Speaking to CNBC-TV18, SK Sangar, Managing Director of the company said that gross non-performing loans (NPLs) have been flat in the quarter gone-by with no slippages or retsructured accounts. The GNPLs of the company in Q3 were worth Rs 38 crore. Going forward, Sangar expects to maintain asset quality and NIMs at 3 percent plus levels. Base rate reduction by 50 bps to 12.25 percent will impact the margins slightly in coming quarters, he said. The company is getting new projects in categories of three stars, resorts and banquets in tier II and tier III cities, he added. Below is the verbatim transcript of SK Sangar’s interview with Reema Tendulkar and Nigel D’Souza on CNBC-TV18.Reema: Can you first walk us through your key numbers this quarter? A: This quarter we have total income of Rs 149 crore which has increased from Rs 142 crore in the corresponding period of the previous year’s nine months. On the profit, we have increased profit by Rs 1.5 crore. For the nine months the profit is Rs 50 crore plus and for the current quarter, on sequential basis, the profit is Rs 15 crore as compared to the Rs 15.75 crore of the corresponding quarter of the previous year. As far as the overall non-performing asset (NPA) position is concerned, we have improved as compared to the previous year. There is no fresh slippage in this quarter and our total NPAs are at Rs 38 crore which is 2.62 percent gross NPA. As we are having almost Rs 33 crore of provision available with us, the net NPA is Rs 5.30 crore only which comes to 0.36 percent only. So, there is an improvement on the NPA front, there is improvement on the total income and operating profit front and also in the net profit for the nine months period.Reema: What are the industry trends that you are seeing now?A: Industry trend, as of now, there is a good potential and improvement and new projects which are coming on, on the three star segment, banquet segment, resorts and this kind of projects but new five star projects are not in the pipeline as of now we see. However, this three star, banquets, resorts, and amusement parks, this kind of projects are coming in tier-II and tier-III cities where we have been able to lend and pickup the business also.Nigel: Any plans of dilution by Industrial Finance Corporation of India (IFCI)?A: IFCI is having as for now 39 percent of stake and there is no plan for diluting any stake anymore. IFCI will continue with the same stake.For entire interview, watch accompanying video...