Mangaluru-based Karnataka Bank expects to make a total recovery of close to Rs 2,500 crore in the financial year 2024-25, Managing Director and Chief Executive Officer Srikrishnan Sarma told Moneycontrol in an exclusive interview on January 25.
“In Q3FY24-25 we have recovered about Rs 200 plus crore and will have a total recovery of close to Rs 2,500 crore in FY24-25,” he said.
Sarma also pointed out that the bank’s CD (credit-deposit) ratio has grown to 75 percent this quarter, the highest level in its history. Edited excerpts:
What are your expectations on the recovery side for this year?
In Q3FY24-25, we have recovered about Rs 200 plus crore and will have a total recovery of close to Rs 2,500 crore in FY24-25.
What are your expectations from the budget?
We believe that there will be an Interim Budget because of the forthcoming elections. Financial reforms are happening and on track, as we have very able leadership at the top in the ministry as well as in the country. And we believe that we are in the right position.
What is your guidance on CASA?
In the last three quarters we have been hovering around 31-36 percent, and that will continue. So, even in our announced deposit growth, we will be in the same range and continue at the same 36 percent, which will be 1/3 of our book. The reason for not growing CASA much is that we are now a certified bank for collecting CBDT (Central Board of Direct Taxes). It is direct and indirect taxes. We have also been certified for the collection of customs duty and GST. So, all this will bring inflows from customers. That buildup will continuously happen because nobody brings money into the account for payment of taxes on the last date.
What are your capital raising plans?
We have already announced that our board has approved Rs 1,500 crore in September. Out of that, we have raised Rs 800 crore already. The balance of Rs 700 crore we are meeting (again) on January 27 to discuss and will announce it.
What are your expansion plans?
We have opened 915 branches and will go up to 950. We opened a branch on January 11. Ayodhya is a very important destination right now for the entire world, and we went ahead and opened a branch even before the Ram temple opening. We have got a branch primarily for retail and also the commercial business, because a lot of hospitality and a lot of development — economic development — is taking place there. We’ll have visitors from all over the country as well as from the world. So, that is the reason we have opened this.
We believe that this will be a good deposit and commercial franchise. So, the branch was planned because we went to Ayodhya—I have seen the development there.
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