Axis Bank well capitalised with self-sustaining capital structure to fund growth: MD

Axis Bank's Managing Director and CEO, Amitabh Chaudhry, has affirmed bank's strong capital position and self-sustaining capital structure, enabling it to support organic growth. Chaudhry expressed confidence in bank's ability to outpace industry aver growth, particularly in Micro, Small, and Medium Enterprises (MSME) segment, with an expected increase of 400-600 basis points in current fiscal year.

To facilitate its expansion, bank possesses ample capital resources for ongoing financial year. Chaudhry elaborated, stating, “Our overall capital equacy ratio, including profit, stood at 17.84 per cent with a CET 1 ratio of 14.56 per cent. Bank accreted 18 bps of CET-1 capital in Q2 FY24 and 54 bps in H1 FY24. Axis Bank is well capitalised with a self-sustaining capital structure for funding organic growth.”

In March, Axis Bank successfully concluded acquisition of Citibank's consumer business and n-banking financial company (NBFC) consumer business for Rs 11,603 crore. This transaction excluded Citi's institutional client businesses in India, bolstering Axis Bank's credit card portfolio to become one of top three card businesses in country, with a total card base of 8.6 million.

Regarding interest rates, Chaudhry ackwledged persistence of high rates in foreseeable future, a sentiment echoed by RBI Goverr Shaktikanta Das. central banks of various nations have raised key policy rates in response to rising inflation, with Reserve Bank of India having cumulatively raised its short-term benchmark lending rate (repo) by 250 basis points since May 2022. However, RBI paused its rate hike in February this year, maintaining repo rate at 6.5 per cent.

(With PTI Inputs)