BoM had a good run in FY26 in terms of deposit and credit growth (14 per cent and 22 per cent, respectively). Can you sustain this momentum in FY27, given that the economy will face headwinds from the West Asia war and the El Nino phenomenon?

Our FY26 performance is part of a consistent growth trajectory over the years. Both advances and deposits have grown steadily in double digits, driven by balanced credit growth and strong liability mobilisation.

A key enabler is our scientific branch expansion under Project 321. We plan to open 321 branches in Phase-1, of which 183 are already operational and generating business. These locations are selected using granular, pin code–level analytics, ensuring profitability and quality sourcing from day one.

In view of the global headwinds such as geopolitical tensions and climate-related risks, we have taken a prudent approach, including creating a ₹200 crore buffer for geopolitical uncertainties, and currently see no material impact.

Supported by focused branch-led sourcing, disciplined risk management and strong deposit traction, we have guided for an 18 per cent growth in advances and 14–15 per cent growth in deposits, with continued emphasis on quality and profitability, in FY27. Our advances and deposits were up by 21.74 per cent and 14.14 per cent, respectively, in FY26

Credit growth is expected to be broad-based, led primarily by RAM — retail, agriculture and MSME (micro, small and medium enterprises) — segments while maintaining a disciplined approach in corporate lending. Corporate credit growth will remain measured and opportunity-driven, with a focus on sectors such as renewables, infrastructure and data centres, where long-term visibility and government support are strong.

BoM ended FY26 with a gap of 760 basis points between credit and deposit growth. Will this gap narrow in FY27?

In FY26, credit growth outpaced deposit growth due to strong lending traction. However, we expect this gap to moderate in FY27, in line with our guidance of 18 per cent advances growth and 14–15 per cent deposit growth.

Deposit momentum will be supported by several structural initiatives. Our GIFT City IBU (international banking unit) commenced operations during FY26 with an asset-led focus.

In FY27, we expect deposits to start flowing into the IBU, aiding liability growth.

Our bank has availed alternate sources of funds like refinance to support credit growth. Overall, the cost of refinance on a blended basis is lower than bulk deposit.

Further, we have set up a ‘new business and customer acquisition’ vertical, headed by a general manager, with a focused mandate on institutional clients, and strengthening bulk and operating account deposits.

Additionally, under Project 321, 183 new branches are contributing to CASA and retail deposits through data-driven location selection.

Overall, with focused institutional deposit mobilisation, branch-led growth and calibrated asset expansion, we are confident of maintaining a healthy balance between credit and deposit growth in FY27.

At the current rate of growth, when do you expect to cross the ₹10-lakh-crore milestone in total business (deposits plus advances)?

In FY2026, our total business grew by ₹95,552 crore (₹72,568 crore in FY25 and ₹65,208 crore in FY24). We are planning to open 1,000 branches in the next five years. Considering the current pace of growth, we are likely to cross the ₹10-lakh-crore total business mark by March 2029.

How big is your corporate loans pipeline? And where is the demand for loans emanating from?

Our bank continues to witness healthy traction in the corporate loan pipeline, supported by sustained demand across select sectors. We have a healthy corporate pipeline of approximately ₹34,500 crore, providing forward visibility for credit growth.

Demand for corporate loans is emanating primarily from infrastructure-linked sectors, including renewable and clean energy, green projects, data centres and select infrastructure projects, where policy support and long-term growth prospects remain favourable.

The bank has been selectively expanding its corporate book in these areas while maintaining prudent underwriting standards and asset quality discipline.

Our GIFT City IBU became operational with effect from September 2025. This is our first overseas branch. The IBU’s lending book mainly comprises ECB (external commercial borrowings) and FCTL (foreign currency term loan) given to corporates.

As at March 31, 2026, the IBU’s exposure stood at around $750 million and is expected to scale up to around $1 billion during FY27. Notably, the IBU achieved breakeven in its first year of operation.

Overall, corporate credit growth is being pursued in a measured and opportunity-driven manner, aligned with our broader strategy of balanced growth and portfolio diversification.

What is your outlook for asset quality in FY27?

The bank’s asset quality metrics have shown consistent improvement over the years, reflecting disciplined underwriting, portfolio rebalancing and focused recovery efforts. As of March 2026, gross NPAs (non-performing assets) declined to 1.45 per cent and net NPA to 0.13 per cent, which are among the better levels within the banking system.

For FY27, our outlook on asset quality remains stable and cautiously optimistic.

Credit growth will continue to be pursued in a measured manner, with emphasis on risk-adjusted returns and portfolio diversification. We have strengthened underwriting standards, particularly in the retail, MSME and agriculture segments, and continue to closely monitor early-warning indicators across portfolios.

At this stage, we don’t see any material stress in any specific segment. While global and domestic macroeconomic developments may pose challenges, we have adequate buffers, strong provision coverage and robust monitoring mechanisms in place. Overall, asset quality is expected to remain within guided levels, with a continued focus on the containment of slippages and recovery from stressed assets.

How much incremental provisioning may be required due to the transition to the ‘expected credit loss’ (ECL) framework?

We have estimated an incremental provisioning impact of ₹2,500–3,000 crore, on account of the transition to the ECL framework.

As per the regulatory transition arrangement, the impact arising due to the transition will be adjusted against opening retained earnings. Further, a phased recognition mechanism is available, whereby the impact on regulatory capital can be amortised over a transition period extending up to March 31, 2031.

Accordingly, we do not envisage any immediate requirement for raising additional capital solely on account of ECL implementation.

Given the Emergency Credit Line Guarantee Scheme (ECLGS) announced by the government, how much incremental credit demand do you expect from MSMEs?

The ECLGS 5.0 has been launched by the government to extend additional credit facility to business enterprises (MSME and non-MSME) to tide over short-term liquidity mismatches in view of the West Asia crisis. This timely intervention will ensure liquidity support, protect jobs, sustain supply chains, and strengthen the resilience of the Indian economy. It will further boost demand and augment growth in the MSME sector.

Overall, we are expecting 18–20 per cent growth in credit demand from MSMEs, with the ECLGS support.