MUMBAI: The Mangalore-headquartered public sector lender Corporation Bank doesn't see any rise in delinquencies, despite the rising interest rate regime, a top bank official has said. "We don't see any rise in defaults in the recent time, despite repeated policy rate hikes by the central bank," the official told PTI over phone from the Mangalore, under the condition of anonymity. The official further said the bank has formed monitoring cells in various regions to inspect vulnerable segments of its loan portfolio. In the first quarter of the fiscal, the lender reported a gross non-performing asset (NPA) of 1.07 percent, down from 1.11 percent in the corresponding period last year. However, its net NPA marginally increased to 0.52 percent during the April-June period from 0.43 percent year ago. Earlier, the bank said it aimed to cut its net NPA ratio to zero by the end of this financial year. About various segments of the loan portfolio, the official said big ticket loan books in the infrastructure sector would not be impacted, as it hopes that the rise in instalments would be absorbed by the companies. However, mid-corporate loans, along with retail advances, may see some repayment pressure, the official admitted. This is significant, as most bankers say various delays in infra projects are a cause of concern for them and fear delinquencies, especially from power sector, which has been hit by coal shortage and environmental clearances. About 10 per cent of the bank's loan book comprises infra funding, mainly into power and road projects. Corporation Bank has a total loan book of 79,000 crore as of the June quarter and is witnessing a growth rate of above 20 per cent in the recent time. Referring to the net interest margin (NIM), the official said that the bank is expecting to clock an NIM of 3 per cent by the end of this financial year. "Despite a rise in deposit rates, we will be able to maintain our NIM at around 3 per cent." The Reserve Bank has raised key policy rates 12 times in the last 19 months to check rising inflation rate, which is hovering around the double-digit mark, much above the comfort level of the central bank. For August, the core inflation stood at 9.78 percent. In turn, the banks have to deal with rising deposit rates coupled with falling credit demand, which has the potential to affect their profitability. Though the RBI steps could not bring down inflation to the desired levels, it has been able to contain credit demand. For August, non-food credit offtake was marginally higher at 19.8 per cent, against 19.7 percent year ago, according to RBI data. But this, according to bankers and RBI, was driven mostly by disbursals of the previous sanctions and not new sanctions. For the entire banking sector, year-to-date non-food credit uptick is just 4.5 per cent. Corporation Bank reported a 5.29 percent increase in its net profit to 351.45 crore for the June quarter against 333.78 crore registered in the year-ago period. Total income of the bank rose by 42.5 percent to 3,266 crore during this period from 2,293 crore in the year-ago period.