All good and great but the retail loans are only 39% of the book and the bank is able to make 18% ROE. How is this possible? Which large corporates that paying that much huge interest to the bank? Seems the bank is getting into wholesale and other very big large lending deals. Otherwise it’s almost impossible to have this kind of growth. The bank just added a kotak bank interns of deposit growth just in an year… how is this even possible in such competitive market. I’m not implying any wrongdoing but these numbers are too good to be comfortable.
I don’t think increasing corporate book in this upcycle is a bad idea. In fact, it might be one of the best times to lend to Corporates given that balance sheets are relatively clean and the RBI most likely doesn’t have much further to go with the repo rate as inflation seems to be peaking out for now. If everybody chases granular retail loans, then who will lend to the corporate sector to fulfil the huge capex plans across infra and industry?
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