On March 10, the Reserve Bank of India (RBI) removed the LIC-controlled bank from its prompt corrective action (PCA) framework, which was imposed in May 2017, after it had breached few regulatory thresholds, including capital adequacy, asset quality and profitability.
“With restrictions imposed by RBI gone, we will like to go in a calibrated way and grow the business in a more profitable fashion so that my efficiency ratios improve. Our revenue, profitability and other ratios will certainly show improvement,” Sharma said.
He said in the fiscal 2021-22, the bank will be targeting to improve net interest margin (NIM) to 3 per cent, return of assets (ROA) at above 0.60-0.70 and cost to income ratio to below 50 per cent.
In the nine months ended December 2020, its NIM stood at 2.79 per cent and cost to income at 54 per cent.
“The depositors will now be seeing the strength of the bank. The bad phase is over and the bank is sufficiently strong,” he said.