Bandhan Bank – Strategy Is To Diversify Credit Book: Nirmal Bang


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We attended the Bandhan Bank Ltd.’s analyst day 2022, wherein the bank demonstrated its various initiatives and progress across business verticals on assets, liabilities and asset quality segments.

The management discussed on the strategic priorities of the banks in terms of portfolio diversification, geographical diversification and focus on granular deposits.

Management expects diversification of credit book to be in favour of non-micro finance institution segments going forward and credit mix to be even by FY2025E driven by higher growth in non-MFI loan book.

The focus would remain on granular deposits and expects composition of retail deposits to increase to around 80% by FY25E versus 74% as on 1=H1 FY23.

On asset quality front, the management expects overall slippages to normalise and expects to achieve steady state credit cost of ~1.8% from FY24E onwards.

We believe, Bandhan Bank is in right direction to diversify its credit book driven by new segment introduction as well as expanding to new geographies going forward.

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