Mumbai: ICICI Bank Ltd’s chief executive and managing director Chanda Kochhar spoke in an interview about the bank’s prospects in the new financial year. Edited excerpts:

You have added 2,000 employees. Does this mean your period of correction of balance sheet is over and loan growth has started?

Yes, absolutely. Our loan growth has started in full swing, and our recruitment has started in full swing. I would not call the last year as a period of correction. I would call it a period of consolidation. But whichever way you term it, clearly from here on, we are looking at very good rates of growth.

Asset quality: ICICI Bank’s Chanda Kochhar says the private lender’s proportion of unsecured loans has come down substantially. Ashesh Shah/Mint

It’s (a relief) for all big banks that are involved in infrastructure financing. This is a welcome move and, in a way, to be fair to the regulator, it’s a very prudent measure because what they have said is that this relaxation is allowed only if the circumstances are beyond the control of the promoter. This is not to really condone inefficiencies, but to say that there are some economic realities...on account of which procedural delays arise and that’s what is been recognized.

Are you now confident NPLs will come down for ICICI?

I am very confident about this trend. If you see the last couple of quarters, the beginning of this trend has already started, that our accretion to NPAs (non-performing assets) on a quarter-on-quarter basis have been coming down for the last couple of quarters, and we will continue to see this trend going forward in the coming year.

But are there any risks as well?

How the NPLs for every bank will play out will be very bank-specific—what is the composition of their assets, what is the quality of their assets and so on. For ICICI Bank, I expect an improvement in the NPA accretion and an improvement in the NPA ratio, given the fact that we have tweaked a lot of our credit parameters in the last one year and the fact that we have substantially changed the composition of our asset book. In our asset book, the proportion of secured loans has gone up substantially. The proportion of unsecured loans has come down substantially and, the way I look at the quality of loans as it exists today, I am very confident that we will see a reduction.

ICICI had cut down on its lending patterns. Do you think your retail book is going to grow from here?

Yes, the retail book is going to grow because we have started growing our home loan book, our car loan book and our commercial vehicles book. A lot of correction that we needed to make on the unsecured part of the retail book has already been made.

What is your view on the government borrowing programme in the new fiscal year?

From the Q2 of this financial year, you will see a very healthy uptake on credit, which means that the situation of very comfortable liquidity that we are living in today may not be there and the demand-supply of money will be very tightly balanced, which does mean that there could be some amount of increase in interest rates in the second half of the coming financial year... But I also believe that the hardening that will take place is going to be pretty smooth... (It) will not create a lot of pain to the growth rates that we are witnessing.