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Healthy momentum in new loans booked, stronger than 4Q of previous years

BAF released its 4QFY23 business update. Here are the key takeaways:

* BAF witnessed a healthy momentum in new customer acquisitions, with 3.1m new customers in 4QFY23 (v/s 2.2m in 4QFY22 and 3.1m in 3QFY23). Total customer franchise stood at 69.1m, up ~20% YoY.

* New loans booked rose ~21% YoY to 7.6m in 4QFY23 (up from 6.3m in 4QFY22).

* AUM growth was in-line with MOSLe, with the reported AUM standing at INR2.47t, up ~25% YoY and ~7.2% QoQ. Core AUM (excluding IPO Financing) grew 29% YoY. Core AUM growth suggested that disbursements were strong across product segments.

* CRAR stood at 24.9% (down ~25bp QoQ), suggesting a stronger AUM growth than the last quarter.

* Deposit book stood at INR446.5b, up 45% YoY and 4% QoQ. Deposit growth momentum slowed to 4% QoQ, owing to a) higher TD rates offered by banks and b) BAF intentionally raising borrowing through other instruments.

* Consolidated Liquidity surplus stood at INR118.5b (up from INR101b in 4QFY22 and INR127.5b in 3QFY23). Surplus liquidity declined to 4.8% of AUM (from 5.5% in 3QFY23). This would have resulted in lower negative carry in the balance sheet.

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