J&K Bank Aims To Steady Home Loan Growth At 16-17% In FY25 With Portfolio Expansion

The Jammu & Kashmir Bank Ltd. is aiming for a growth in the mid-teen range for the financial year 2024–25, which it hopes to achieve by expanding its home loan portfolio, said Chairman and Managing Director Baldev Prakash.

For the second quarter, the Srinagar-based bank's operating profit rose 32% quarter-on-quarter to Rs 787 crore from Rs 597 crore in Q1.

The bank’s interest margins also improved at 3.9% in Q2 against 3.86% in the preceding three months.

Commenting on the results, Prakash said, “We have given our guidance of mid-teen growth in advances and around 12% in deposits. We are maintaining that guidance and we are confident that we will be able to meet our guidance, both in deposit advances as well as in the quality of assets.”

This growth, Prakash said, will come from the bank’s retail portfolio and enhanced focus on home loans. The top executive highlighted that 70% of its existing loan book is retail.

“Retail loan portfolio is mainly coming from the local territory of Jammu and Kashmir and Ladakh. But in the rest of the country, we are mainly focused on corporate growth, and now that corporate growth is supported by home loan growth,” he stated.

According to Prakash, the bank had changed a lot of processes in the home loan portfolio to scale the business up in new geographies. “We are now confident that we can scale up the home loan portfolio. We have already started doing it.”

Last year, the lender's home loan growth stood at about 20%. “This year, though the first half has not been great for us, we are definitely growing around 16–17% in home loans even this year. We want to maintain this tempo and bring it around 20% but definitely 16–17% is our target.”

In the home loan segment, J&K Bank aims to remain the market leader in its base territories—J&K and Ladakh—while further improving the market share, the top executive noted.

However, the bank is also focusing on new geographies for expansion. “The focus has now shifted to the territories like Gurgaon, Pune, Bangalore, etc. Here also, we are looking and we are seeing that a good response is coming. The scheme is good, the teams are ready. I think we have prepared the ground first. Then we started this business,” he said.

Shares of J&K Bank dipped 3.17% during Friday’s intraday trade to a low of Rs 102.60 apiece on the NSE.

The shares were trading 2.98% lower at Rs 102.8 apiece at 12:30 pm, while benchmark Nifty 50 slipped 0.11% around the time.

The scrip closed 2.56% lower at Rs 103.25 apiece on the NSE against the benchmark Nifty 50's decline of 0.21%.