The private lender, IDFC First Bank in its annual report, addressed the concerns that some of the investors would have about its exposure to the cash-strapped telecom service provider.

In a note to its shareholders, IDFC First Bank Managing Director and CEO V Vaidyanathan said, “I would now like to directly address the concerns that some of you would have about our exposure to Vodafone Idea. Let us hope the government supports the industry; out of the total dues of the company, about Rs 1.5 lakh crore are owed to the government itself, and hence they will be keen to solve this issue. In any case, we have a lot of growth capital by our side.”

While other lenders also have high exposure to Vodafone in absolute amounts, Yes Bank and IDFC First are likely to be impacted the most as the top percentage of their loan books.

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“We will peruse the matter through the law of the land. With a strong liability base consisting of low-cost CASA of 50 per cent plus, we get good margins in our business. We can compound our advances continuously by about 25 per cent for a long time, and we can build this book to any size of our desire in our lifetimes, it could be Rs 2 lakh crore, Rs 5 lakh crore, Rs 10 lakh crore, or more,” Vaidyanathan added.

Stock Covered in the news

IDFC Frist Bank Ltd-View Detailed Analysis