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Concentrations of credit risk
 12 Months Ended
Mar. 31, 2023
Concentrations of credit risk
10. Concentrations of credit risk
Concentrations of credit risk exist when changes in economic, industry or geographic factors similarly affect groups of counterparties whose aggregate credit exposure is material in relation to the Bank’s total credit exposure. The Bank manages its credit risk collectively for its loan portfolio and credit substitute securities as these instruments are invested in as part of an overall lending program for corporate customers; accordingly, information on concentrations of credit risk has been provided for these exposures together.
In the case of wholesale loans, while the Bank generally lends on a cash-flow basis, it also requires collateral which consists of liens on inventory, receivables and other current assets, and in some cases, charges on fixed assets, such as property, movable assets (such as vehicles) and financial assets (such as marketable securities) from a large number of the Bank’s borrowers. The Bank’s retail loans are generally secured by a charge on the asset financed (vehicle loans, property loans and loans against gold and securities). Retail business banking loans are secured with current assets as well as immovable property and fixed assets in some cases. However, collateral securing each individual loan may not be adequate in relation to the value of the loan. If the customer fails to pay, the Bank would, as applicable, liquidate collateral and/or set off accounts. The maximum estimated loss that would be incurred under severe, hypothetical circumstances, for which the Bank believes the possibility is extremely remote, such as where the value of the Bank’s interests and any associated collateral declines to zero, without any consideration of recovery or offset is determined as the carrying values of the instruments as given in the below table.
 
 
The Bank’s portfolio of loans, credit substitute securities and non-funded exposure (including derivatives) is broadly diversified along industry and product lines, and as of March 31, 2022 and March 31, 2023, the exposures are as set forth below.
 
    
As of March 31, 2022
  
Category
   
Gross loans
     
Fair value of
credit substitutes
     
Non-funded
exposure
     
Total
     
%
  
                                    
    
(In millions, except percentages)
  
Consumer Loans
    Rs.   3,746,781.7      Rs.   —        Rs.   3,035.7      Rs.   3,749,817.4        22.7  
Power
      671,859.4        70,346.0        52,366.6        794,572.0        4.8  
Financial Institutions
      618,494.1        51,844.1        13.1        670,351.3        4.1  
NBFC
      509,445.4        106,764.5        5,818.5        622,028.4        3.8  
Retail Trade
      589,947.3        —          28,857.8        618,805.1        3.7  
Coal & Petroleum Products
      233,583.7        174,424.6        149,716.9        557,725.2        3.4  
Infrastructure Development
      272,428.0        18,032.7        220,442.5        510,903.2        3.1  
Automobile & Auto Ancillary
      443,538.7        19,768.7        36,999.9        500,307.3        3.0  
Consumer Services
      465,465.8        —          28,102.4        493,568.2        3.0  
Food and Beverage
      433,042.2        —          39,007.2        472,049.4        2.9  
Wholesale Trade—Non Industrial
      417,954.8        —          26,147.5        444,102.3        2.7  
Real Estate & Property Services
      383,765.5        4,792.6        40,694.4        429,252.5        2.6  
Wholesale Trade—Industrial
      347,202.9        —          73,867.5        421,070.4        2.5  
Road Transportation
      406,376.4        —          10,269.5        416,645.9        2.5  
Iron and Steel
      321,587.7        12,486.0        80,515.7        414,589.4        2.5  
Telecom
      331,131.1        2,989.4        43,335.9        377,456.4        2.3  
Textiles & Garments
      324,419.6        6,135.7        43,748.6        374,303.9        2.3  
Engineering
      253,105.1        6,666.6        105,164.7        364,936.4        2.2  
Agri Production—Food
      350,859.6        —          963.1        351,822.7        2.1  
Others (none greater than 2%)
      3,288,555.0        108,769.3        546,407.8        3,943,732.1        23.8  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
Total
    Rs.   14,409,544.0      Rs.   583,020.2      Rs.   1,535,475.3      Rs.   16,528,039.5        100.0  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
 
 
                                                                                                       
    
As of March 31, 2023
  
Category
   
Gross loans
     
Fair value of
credit substitutes
     
Non-funded

exposure
     
Total
     
Total
     
%
  
                                                       
           
(In millions, except percentages)            
  
Consumer Loans
   
Rs.  
4,410,346.6
 
   
Rs.  
—  
 
   
Rs.  
2,550.8
 
   
Rs.  
4,412,897.4
 
   
US$
53,691.4
 
   
 
22.4
 
Retail Trade
   
 
973,274.3
 
   
 
—  
 
   
 
36,013.4
 
   
 
1,009,287.7
 
   
 
12,279.9
 
   
 
5.1
 
Power
   
 
695,716.5
 
   
 
64,805.5
 
   
 
45,576.3
 
   
 
806,098.3
 
   
 
9,807.7
 
   
 
4.1
 
NBFC
   
 
690,783.9
 
   
 
91,595.9
 
   
 
15,995.5
 
   
 
798,375.3
 
   
 
9,713.8
 
   
 
4.1
 
Financial Institutions
   
 
659,117.5
 
   
 
72,068.3
 
   
 
4,435.4
 
   
 
735,621.2
 
   
 
8,950.3
 
   
 
3.7
 
Consumer Services
   
 
581,272.1
 
   
 
3,545.4
 
   
 
123,464.7
 
   
 
708,282.2
 
   
 
8,617.6
 
   
 
3.6
 
Food and Beverage
   
 
566,172.9
 
   
 
1,419.2
 
   
 
49,084.4
 
   
 
616,676.5
 
   
 
7,503.1
 
   
 
3.1
 
Road Transportation
   
 
568,414.2
 
   
 
—  
 
   
 
12,512.4
 
   
 
580,926.6
 
   
 
7,068.1
 
   
 
3.0
 
Coal & Petroleum Products
   
 
353,329.8
 
   
 
115,279.8
 
   
 
102,771.3
 
   
 
571,380.9
 
   
 
6,952.0
 
   
 
2.9
 
Wholesale Trade—Non Industrial
   
 
530,057.5
 
   
 
1,988.8
 
   
 
31,887.0
 
   
 
563,933.3
 
   
 
6,861.3
 
   
 
2.9
 
Automobile & Auto Ancillary
   
 
483,658.4
 
   
 
17,656.8
 
   
 
38,921.4
 
   
 
540,236.6
 
   
 
6,573.0
 
   
 
2.7
 
Real Estate & Property Services
   
 
458,906.6
 
   
 
4,691.4
 
   
 
52,228.7
 
   
 
515,826.7
 
   
 
6,276.0
 
   
 
2.6
 
Wholesale
Trade—Industrial
   
 
421,900.9
 
   
 
—  
 
   
 
70,853.6
 
   
 
492,754.5
 
   
 
5,995.3
 
   
 
2.5
 
Infrastructure Development
   
 
284,690.7
 
   
 
15,220.2
 
   
 
170,452.2
 
   
 
470,363.1
 
   
 
5,722.9
 
   
 
2.4
 
Engineering
   
 
300,745.5
 
   
 
5,596.0
 
   
 
131,956.5
 
   
 
438,298.0
 
   
 
5,332.7
 
   
 
2.2
 
Agri—Allied
   
 
431,581.2
 
   
 
—  
 
   
 
2,701.2
 
   
 
434,282.4
 
   
 
5,283.9
 
   
 
2.2
 
Iron and Steel
   
 
360,021.9
 
   
 
12,231.9
 
   
 
61,224.3
 
   
 
433,478.1
 
   
 
5,274.1
 
   
 
2.2
 
Textiles & Garments
   
 
390,883.0
 
   
 
4,984.5
 
   
 
34,729.1
 
   
 
430,596.6
 
   
 
5,239.0
 
   
 
2.2
 
Telecom
   
 
365,112.3
 
   
 
—  
 
   
 
42,221.1
 
   
 
407,333.4
 
   
 
4,956.0
 
   
 
2.1
 
Agri Production—Food
   
 
401,720.3
 
   
 
—  
 
   
 
1,040.5
 
   
 
402,760.8
 
   
 
4,900.4
 
   
 
2.0
 
Others (none greater than 2%)
   
 
3,490,386.3
 
   
 
92,104.1
 
   
 
719,829.4
 
   
 
4,302,319.8
 
   
 
52,346.0
 
   
 
22.0
 
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
Total
   
Rs.
  
17,418,092.4
 
   
Rs.
  
503,187.8
 
   
Rs.
  
1,750,449.2
 
   
Rs.
  
19,671,729.4
 
   
US
$
239,344.5
 
   
 
       
100.0
 
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
 
 
The Bank’s ten largest exposures as of March 31, 2022 and March 31, 2023, based on the higher of the outstanding balance or the limit on loans, investments (including credit substitutes) and non-funded exposures (including derivatives),
are as
follows:
 
    
As of March 31, 2022
  
    
Funded
Exposure
     
Non-Funded
Exposure
     
Total
Exposure
  
                            
    
(In millions)
  
Borrower 1
    Rs.   265,661.9      Rs.   500.0      Rs.   266,161.9  
Borrower 2
      245,435.0        —          245,435.0  
Borrower 3
      119,950.5        116,547.4        236,497.9  
Borrower 4
      150,283.8        —          150,283.8  
Borrower 5
      126,639.8        19,268.4        145,908.2  
Borrower 6
      142,600.0        —          142,600.0  
Borrower 7
      140,000.0        232.0        140,232.0  
Borrower 8
      137,700.0        199.2        137,899.2  
Borrower 9
      133,670.0        —          133,670.0  
Borrower 10
      108,591.5        17,855.7        126,447.2  
 
                                                                     
    
As of March 31, 2023
  
    
Funded
Exposure
     
Non-Funded

Exposure
     
Total
Exposure
     
Total
Exposure
  
                                     
           
(In millions)
         
Borrower 1
   
Rs.  
284,002.5
 
   
Rs.  
—  
 
   
Rs.  
284,002.5
 
   
US$  
3,455.4
 
Borrower 2
   
 
220,901.6
 
   
 
1,200.0
 
   
 
222,101.6
 
   
 
2,702.3
 
Borrower 3
   
 
205,801.0
 
   
 
—  
 
   
 
205,801.0
 
   
 
2,504.0
 
Borrower 4
   
 
80,344.5
 
   
 
112,144.7
 
   
 
192,489.2
 
   
 
2,342.0
 
Borrower 5
   
 
185,299.0
 
   
 
—  
 
   
 
185,299.0
 
   
 
2,254.5
 
Borrower 6
   
 
154,296.7
 
   
 
21,764.8
 
   
 
176,061.5
 
   
 
2,142.1
 
Borrower 7
   
 
155,565.7
 
   
 
60.0
 
   
 
155,625.7
 
   
 
1,893.5
 
Borrower 8
   
 
139,808.3
 
   
 
—  
 
   
 
139,808.3
 
   
 
1,701.0
 
Borrower 9
   
 
121,560.0
 
   
 
6,030.3
 
   
 
127,590.3
 
   
 
1,552.4
 
Borrower 10
   
 
112,479.0
 
   
 
15,070.0
 
   
 
127,549.0
 
   
 
1,551.9