"The single agenda (for the bank) is to focus on profitability without doing anything aggressively," Prashant Kumar said in an interview. "The first step for us is to achieve a RoA of 1% in the next two years and 1.5% by 3-5 years."

Yes Bank's return on assets - which is the ratio of how profitable a company is compared with its total assets - was at 0.2% for the October-December quarter.

Small-and-medium-enterprise loans and mid-sized corporate loans made up nearly 30% of the Mumbai-based bank's loan book in the December quarter, which Kumar said will be increased to 35% going forward.

The bank is unwilling to compromise on pricing despite intense competition, he said.

"We would not like to go for higher deposit growth by offering higher rates," Kumar said, adding they would also not grow loans by offering a lower rate of interest.

Yes Bank aims to grow overall loans by 13% year-on-year in the March quarter, largely aided by retail loans, while a deposit growth of 15% looks "reasonable", the CEO said.

The bank reported a loan growth of 11.8% in the December quarter, while its deposits grew 13.2%.

"At no point in time credit growth will be higher than the deposit growth," Kumar said.

The CEO does not foresee the need for raising capital for the lender, at least for the next financial year that starts April 1.

The bank aims to open 110 branches by March-end, lower than its earlier target of 150 branches, with the remaining 40 to be opened in the following three months, Kumar said.

(Reporting by Siddhi Nayak; Editing by Mrigank Dhaniwala)

By Siddhi Nayak