Corporate Presentation FY 2019-20
Contents Company Background Key Differentiators Business resilience under Lockdown Fullerton India Standalone Financials Management Team CSR and Accolades Housing Finance Standalone Financials Consolidated Financials
Company Background
FFH operates financial institutions in emerging markets Focused on SME and mass market customer segments CHINA Central CHINA 127 Community Banks 4 Provinces, 2400k Customers 41 Outlets 100k Cust INDIA MYANMAR 648 Branches DUBAI, UAE 51 Branches 3,200k Cust 6 outlets 223k Cust 34k Cust CAMBODIA POST BANK 103 Branches INDIA 129k Cust Digital MSME 55K Cust MALAYSIA 82 Branches 957 k Cust Fullerton Home Finance^ Fullerton Financial Holdings (FFH) has 8 operating financial services entities located across 6 countries. 4 *FFH is a wholly owned subsidiary of Temasek ^Fullerton Home Finance is a wholly owned subsidiary of Fullerton India
Fullerton India Credit Company Corporate Evolution 2003 2010 2014 FFH, parent entity of Commercial Vehicle Accelerated secured business, FICCL is incorporated as a wholly- business launched. Rural network owned subsidiary of Temasek Network consolidated. Operations process revamp Holding (P) Ltd 2005 2011 2015-17 FICCL was acquired by FFH in Portfolio reshape and segmental Capital Infused for growth. Home December 2005 shift to mass affluent. Fin business launched. LAP, SME business re-launched. Rural franchise expanded. Achieved operational breakeven . 2006-08 2012-13 2018-20 Commercial Launch of Capital infused for growth RoE of 17%+ delivered. INDAS NBFC operations. Rural network expanded. implemented. Fullerton Direct Pan-India presence established. Funding diversified. launched. Branches exceeded 640, AUM crossed INR 220bn. Early Mid Growth stage construction stage 5
Fullerton India Credit Company Ltd Quick statistics FY20 Reach Scale Momentum INR bn INR bn 648 46 14 Branches Average Monthly Net worth business writing INR bn Thousand 600 207 average accounts 248 Towns Asset Under opened every month Management mn Thousand Thousand villages 58 14 3.2 employees covered Customers 6
Key Differentiators
Fullerton India has created significant competitive advantage Deep inter-linkages, strategic and operational 1 Strong Parentage and Governance oversight Granular Pan India portfolio, addressing the Unique Business Model in Retail 2 under-banked segment with limited access to Finance formal channels Conservative Liquidity and Risk Prudent ALM practices, resilient credit and 3 management operational risk mitigation End to end process digitization Future ready through Investment in 4 Best in class technology ,data infrastructure and Digitization, Technology and Analytics strong analytics 8
Fullerton India has created significant competitive advantage Deep inter-linkages, strategic and operational 1 Strong Parentage and Governance oversight Granular Pan India portfolio, addressing the Unique Business Model in Retail 2 under-banked segment with limited access to Finance formal channels Conservative Liquidity and Risk Prudent ALM practices, resilient credit and 3 management operational risk mitigation End to end process digitization Future ready through Investment in 4 Best in class technology ,data infrastructure and Digitization, Technology and Analytics strong analytics 9
Close and Continuous Engagement with Parent Strategic and operational guidance, in addition to oversight Strong oversight and Risk Governance by Board & Independent Directors Risk Oversight Nomination & Remuneration IT Strategy Audit Committee CSR Committee Committee Committee Committee Reviews the financial Oversees overall Human Capital Recommends CSR Oversees IT Oversees credit, market and operational risk statements and financial mission and strategy. policy, budgets, governance, reporting process projects, etc. strategies, policies, Reviews risk appetite and Oversees key appointments and spends, etc. credit policies Reviews scope, findings, compensation matters Monitors reports, etc. of Internal and implementation Reviewing cyber Monitors portfolio external audit Reviews structure and of the CSR security matters performance and composition of the Board and activities approves mitigation Oversees Internal controls recommends for changes actions framework Board deeply involved in the strategy development, financial planning and oversees business execution Joint agreement on business strategy and annual targets including investment slates and compensation ALCO is represented by two FFH executives who provide regular inputs, similarly for Finance and Risk 10
Fullerton India has created significant competitive advantage Deep inter-linkages, strategic and operational 1 Strong Parentage and Governance oversight Granular Pan India portfolio, addressing the Unique Business Model in Retail 2 under-banked segment with limited access to Finance formal channels Conservative Liquidity and Risk Prudent ALM practices, resilient credit and 3 management operational risk mitigation End to end process digitization Future ready through Investment in 4 Best in class technology ,data infrastructure and Digitization, Technology and Analytics strong analytics 11
Strong Pan-India distribution network 648 branches cover 25 states/UT in the Country Geographically diversified 13% 21% North South 648 West 32% East 34% Branch Coverage* 40 53% 42% 3 5% Metro Urban Centre Semi Urban & Rural Centre *As per Census 2011 Centre Definition- Metropolitan: population >10 lakh; Urban: >1 lakh and <10 lakh; 12 12 UT-refers to union territory Semi-Urban: >10,000 and <1 lakh; Rural: <10,000
Focused on a bankable, underserved segment Serving customers with limited access to formal banking channels Customer Segment Annual Household Income No. of Households Serviced By Affluent Foreign & 17 mio (7%) > INR 1,100K Private Banks Servicing the segment Aspirers below the Foreign and 40 mio (16%) Private banks INR 500K – 1,100K FICC Positioning Addressable market of Next Billion 140 mio households by 121 mio (45%) 2025 – 50% is INR 150K – 500K underserved Strugglers MFI Lenders 82 mio ( 31%) < INR 150K Microfinance FICC targets underserved segment not covered by large banks and MFIs 3.2 mio live customers provide a large cross sell and upsell opportunity Source : Euro Monitor and BCG 13
A Well-diversified asset portfolio Multiple product, customer and geographic segments create durability Geographically diversified ..across multiple asset classes (AUM).. Others, 1% Rural Business Loans, 7% Loans against Property, 32% Rural Loans, 15% Digital , 6% Commercial Vehicle, 6% Personal Loans - Business, 14% Personal Loans - Salaried, 19% 14
Lines of business Addressing a wide spectrum of customers, across needs and Affluence Neighborhood financer generating employment & income and partnering growth Urban Digital Serving the underserved largely in under penetrated geographies Fullerton Point Fullerton Direct Rural Direct to customer, faster Providing customized, large Gramshakti and convenient suite of financial solutions in affluent markets Tapping diversified segment of customer directly or Catering to consumer, retail businesses and MSME/SME through Fintech partnership across customer value chain led model 15
Urban Business Wide network, resilient business model addressing Individuals and Small business Wide spread network Distribution channels Retail focus 236 branches across 25 Tapping all customer largely present in tier 2 states and UT’s ; touch points – direct, downwards, focus on low Portfolio Distribution leveraging existing cross channel based, lead based ticket, high yield business business infrastructure channels and alternate and ability to upsell/ Commercial channels cross-sell Others, 1% Vehicle, 11% Personal Loans - Broad customer segment Product suite Salaried, 32% Serving wide variety of Digital focus Customized offering Loans against customers across Digitizing each step of Property, 31% across value chain with consumer,retail business customer loan life cycle to clearly defined product and SME/MSMEs for all process efficiencies strategies and Personal kinds of personal and geographical presence Loans - business end use inclusive of insurance Business, 25% 16
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