RBL Bank targets 5% NIM this fiscal

EVEN AS A MODERATE amount of deposit repricing is scheduled for Q2FY24, private sector lender RBL Bank is confident of achieving 5% net interest margin (NIM) by the end of the current financial year by focusing on high-yielding assets, MD and CEO R Subramaniakumar told FE in an interaction.

- PIYUSH SHUKLA

"Most of the repricing (in deposits) has happened here in Q1 and a small amount of repricing will take place in Q2 also. Nevertheless, the deposit repricing in Q2 will be offset with advances (growth in high yield loan segments)...so if we look at 4.84% (NIM during Q1FY24) it will move up by may be 10 basis points (bps) in Q2 and thereafter it will inch up to 5%. Thereafter, it will keep improving," the MD said.

His comments come at a time when other large private and public sector banks have witnessed a slight moderation in their NIMs in Q1FY24. RBL Bank's NIM too moderated to 4.84% during Q1FY24 from 5.01% in Q4FY23.

On liabilities side, the bank is planning to grow its overall deposits by 18%-20% during the current fiscal by primarily focusing on granular deposits, the MD said. The bank's overall deposits rose 8% year-on-year (YoY) to ₹85,636 crore as of Juneend, of which low-cost current account and savings account accounted for ₹31,927 crore.