Search
IDFC First bank expects NIM to be stable from here on
May 03, 2023
V Vaidyanathan, IDFC First’s managing director and chief executive, told Business Standard cost will catch up on the re-pricing of deposits. After repo rate hikes, costs were passed on to customers in FY23. However, the cost to banks did not go up correspondingly. It takes about a year for costs to catch up. The private lender had reported a NIM of 5.96 per cent for Fy22.
As for the impact of shifting of money to term deposits, he said the financial year, generally speaking, is going to be tight for CASA. Money could shift from CASA to fixed deposits because interest rates are high. “We think we could stay in the band of 45-50 per cent (of total deposits) in FY24,” he said.
In FY23, IDFC First bucked the industry trend of a decline in CASA share in total deposits. Its CASA share rose from 48.44 per cent at end of March 2022 to 49.77 per cent at end-March 2023.
Private sector lenders like HDFC Bank saw CASA share declining to 44 per cent in March 2022, from 48 per cent a year ago. For Kotak Mahindra Bank CASA share dipped to 52.8 per cent in March 2023 from 60.7 per cent a year ago.
Important Links:
- 4-IN-1 Professional Diploma in Banking, Financial Services & Insurance (PDBFSI): https://tscfm.org/courses/4-in-1-professional-diploma-in-banking-financial-services-insurance-pdbfsi/