This has enabled HDFC to manage its asset liability maturity to a large extent. HDFC's loan book has had an 80:20 mix between mortgage loans and EPF loans over the past two years. Despite a loan growth, HDFC's absolute NPL's are declining, due to better monitoring and quicker recovery efforts which includes focused follow-up. In 2003, NPL's fell to 21 percent despite a 20.6 percent loan growth in the same period. Gross NPLs/Gross loans were 11.1 percent in 2003 and have been on a declining trend since 2001. This improvement is largely on account of NPL recoveries and to some extent loan growth. Further net NPL/Equity ratio was at 58.9 percent as at Dec 2003. "Going forward the challenge for HDFC would be to contain NPL's in light of the high loan growth witnessed over the last few years," notes Fitch. HDFC's operating expenses grew by 9.2 percent. Cost/income ratio has improved from 36.0 percent in 2000 to 32.5 percent in 2003.