CSB Bank won't sacrifice growth for the sake of its net interest margins

This is a bold stance, as many banks tend to prioritize margin overgrowth to maximize profitability. However, Mondal seems to believe that sustainable growth is the key to long-term success and that sacrificing it for short-term gains would be counterproductive.

Fortunately for CSB Bank, deposit growth remains strong. This is a good sign for any bank, as deposits are a key source of funding for lending activities. A robust deposit base can help ensure that the bank has ample liquidity to support loan growth and other business initiatives.

Mondal also commented on the G-Sec curve, which refers to the yield curve of government securities. He noted that the curve is flattening, which should lead to stabilization in the cost of funds. This is an important development for banks, as it means that they may be able to obtain funding at lower rates in the future.

However, Mondal did caution that opex would remain elevated for the foreseeable future. This is because the bank is investing in retail, small and medium enterprises (SME) products and transaction banking. These are all areas of the business that require significant investment in technology, infrastructure, and personnel. While these investments may weigh on the bank's profitability in the short term, they could pay off handsomely in the future if they result in sustainable growth.

Shares of CSB Bank recorded a fresh 52-week high of Rs 297.2 per piece on BSE in Friday’s trade, as the private lender reported healthy growth in net profit and net interest income (NII) for the March quarter (Q4FY23).

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