At a recent meeting, we find increased confidence in the management on various parameters, even as nothing much has changed on the ground level yet. It remains confident about 3-5% higher-than-industry growth and new stressed assets at R6,500 crore with a positive bias and specific credit costs at 75-80 bps. Confidence on FY16 is fairly high and credit costs could decline and even revert to its earlier run rate of ~60 bps, though there might be some new regulatory requirements by then.

The management still guides for R6,500 crore of new stressed assets formation in FY15 (versus R5,700 crore in FY14). However, bias is now positive (can be lower as well).

Exposure to levered companies has reduced to <8%, down from 10% about a year back and comfort on many of the levered corporate have also increased.

Expected specific credit costs are at 75-80 bps, but the bank may start making provisions on unhedged forex exposures now in addition to this. In FY16, both slippages and credit costs are expected to be lower. We however, still build in 85 bps of credit costs in FY15 and 80 bps in FY16.