Will meet recovery guidance; infra bonds in pipeline

With the announcement of measures to infuse liquidity into the banking system, cost of borrowings is expected to come down, says Binod Kumar, managing director and CEO, Indian Bank.

- BINOD KUMAR, MANAGING DIRECTOR AND CEO, INDIAN BANK

In an interview with Anupreksha Jain, he says with moderation in interest rates, the CASA ratio is expected to improve. Excerpts:

What is the guidance on net interest margin (NIM) for FY25? If the RBI goes for a rate cut, how do you see it impacting the NIM?

Our guidance for NIMs is between 3.40% and 3.50%. Certainly, there will be some impact of the rate cut, but 57% of the bank's book is linked to the marginal cost of funds-based lending rate and 37% is linked to the external benchmark lending rate. We have provided enough cushion against any cut in the policy rate. As moderation in interest rates is expected after the rate cut, the current account and savings account (CASA) ratio will improve as the differential between term deposits and CASA is likely to come down.

How do you see RBI measures to address the liquidity crunch in the system impacting the bank?