Investor Presentation 30.06.2018
DISCLAIMER This presentation has been prepared by Karur Vysya Bank Limited (“the Bank”) solely by the Bank for information purposes only. This presentation is not a complete description of the Bank and the information contained herein is only current as of its date and has not been verified by anyone else. All financial numbers are based on the Audited Financials or the Reviewed Financial results or based on Management estimates. Figures for the previous period(s) have been regrouped wherever necessary; totals in columns / rows may not agree due to rounding off. The accuracy of this presentation is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the Bank. This presentation does not constitute an offer or invitation, directly or indirectly, to purchase or subscribe for any securities of the Bank by any person / entity based in India or in any other country. No part of it should form the basis of or be relied upon in connection with any investment decision or any contract or commitment to purchase or subscribe for any securities. This presentation may contain statements that constitute forward-looking statements. All forward looking statements are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those contemplated. Factors that could cause actual results to differ materially include, inter-alia, changes or developments in the Bank’s business, political, economic, legal and social conditions. Given these risks, uncertainties and other factors, viewers of this presentation are cautioned not to place undue reliance on these forward-looking statements. Except as otherwise noted, all of the information contained herein is indicative and is based on management information, current plans and estimates / projections. Any opinion, estimate or projection in the presentation constitutes a judgment as of the date of this presentation and there can be no assurance that future results or events will be consistent with any such opinion, estimate or projection. The Bank disclaims any obligation to update these forward-looking statements to reflect future events or developments. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained in this presentation. Further, past performance is not necessarily indicative of future results. Anyone placing reliance on the information contained in this presentation or any other communication by the Bank does so at his / her / their own risk. Neither the Bank nor anyone else shall be liable for any loss or damage caused pursuant to any act or omission based on or in reliance upon the information contained in the presentation. The Bank may, at its sole discretion, alter, modify or otherwise change in any manner the contents of this presentation, without obligation to notify anyone of such change/s. This presentation is not to be distributed, redistributed, copied or disseminated, in any manner, either directly or indirectly. 2
Performance Highlights Q1 FY 2018-19 OPERATING ADVANCES PROFIT Rs.47,886 cr. Rs. 460 cr. 13% BUSINESS CRAR Rs.1,05,440 cr. 14.08% 9% CASA NIM Rs. 17,244 cr. 3.65% 8% 3
KVB – an unique franchise! Bank of Choice, trusted by : Over 7 million individuals Over 450000 businesses Over 700000 customers involved in agriculture 1 7 1 14 Unmatched presence in India’s fast growing hinterland 6 3 6 1 CATEGORY No of Branches 4 2 16 Metro 205 16 Urban 161 5 1 Semi Urban 298 28 59 Rural 126 Total 790 52 1 119 7 420 Category 30.06.18 31.03.18 31.03.17 21 Branches 790 790 711 Rural Metro ATM's + Cash 2337 2328 2191 16% 26% Recyclers Customer service excellence the differentiator Urban Semi 20% Urban 38% 4
Performance Highlights Q1 FY 18-19 (Y-o-Y) Total Business stands at Rs.1,05,440 crore (up from Rs. 97,069 crore as on § 30.06.2017) registering a growth of 9% Robust credit growth of 13% (Rs. 5,485 crore); Gross Advances as on § 30.06.2018 : Rs. 47,886 crore CASA share up at 30% with 8% Y-o-Y growth § Savings deposits growth at 13% § Total deposits grow by 5% Y-o-Y § Operating Profit stands at Rs. 460 crore § Net Interest Income up by Rs. 45 crore ( 8% rise) § NIM stands at 3.65% § Other Income increases by Rs. 19 crore ( 8% rise) § CRAR stands at 14.08% § 5
Blending Tradition with Modernity Progress being made as per plan • Digital System rollout as envisioned , no significant delay in new technology rollout. – Digital transformation milestones achieved and progressing well • Home loan, working capital loan renewal, Mortgage (LAP) & Unsecured Personal loan live – Fully paperless solution available in assisted & self service modes – Good adoption of new digital tools • >300 applications daily. – Aim to raise this to 2 application / branch / day – Core banking platform upgradation underway • Upgrading to version 11.7 of Flexcube for improved security & functionality – Based on service oriented architecture that enables open API banking – Integration gateway enabled – Expected to go live in Jan 2019. – Dedicated Asset Sales Force created to facilitate retail asset growth • Driving branch adoption of new technologies / products – Third Party Product Sales Force established • To facilitate sale of Insurance/Investment & other ancillary products – Business Growth – Life Insurance Premium Growth - 116% over Q1, FY17-18 Non Life Insurance Premium Growth - 41% over Q1, FY17-18 Mutual Fund Revenue Growth - 125% over Q1, FY17-18 Health insurance distribution agreements signed with Aditya Birla Health Insurance Ltd & Max – Bupa Health Insurance Ltd. 6
Blending Tradition with Modernity Branch Productivity measurement system live • Enables target setting & monitoring of all branch staff – Product agnostic branch sales target set – New Branch / individual sales incentive scheme live. • Centralized Collection Infrastructure established • Live since January 2018 – Retail Credit products covered, Commercial products coverage to start in Q3 – New Commercial Collection System live • Wide spread adoption at branch level – Enables systematic collections while maintaining Branch Relationship. – New Recovery Management system scheduled to go live by end July 2018. • Analytics – Centre of Excellence • Being established (Q3, 2018) – 7
Digital Transformation Working Capital (Renewal) Mar. 2018 Home Loans Mar. 2018 Working Capital - Enhancement / Adhoc Loan Against Jul . 18 Property Jul. 2018 Personal Loan Jul. 2018 Digital Bank Auto Loans Jul. 18 Originally Schedule Aug.2018 Working Re-Scheduled* to Sep. 18 Capital (Fresh) Scheduled* Aug. 18 Commercial Term Loans Credit Card Scheduled* Scheduled* Dec. 2018 Q3, FY18-19 8 * Scheduled dates are provided on the basis of information available at this time, these are subject to change
The New Operational Paradigm – A Work in Progress Hyper Local branches with empowered Managers to meet customer needs immediately 9
Balance Sheet (Rs. in crore) Particulars June 18 June 17 Y-o-Y (%) Capital & Liabilities Capital 145 122 19 Reserves and Surplus 6,165 5,125 20 Deposits 57,554 54,668 5 Borrowings 3,075 1,180 161 Other Liabilities and Provisions 1,337 1,433 (7) Total 68,276 62,528 9 Assets (3) Cash and Balances with RBI 3,002 3,107 14 Balances with Banks 838 734 6 Investments 16,108 15,191 11 Advances 46,406 41,698 Fixed Assets 550 426 29 Other Assets 1,372 1,372 0 9 Total 68,276 62,528 9 Business (Gross Advances + Deposits) 1,05,440 97,069 10
Income v/s Expenses (Rs. in crore) Non Interest Income Net Interest Income 8% YOY 8% YOY 700 300 600 643* 250 255 584 236 562 555 230 225 500 200 539 209 400 150 100 300 50 200 0 100 June 17 Sep 17 Dec 17 Mar 18 June 18 June 17 Sep 17 Dec 17 Mar 18 June 18 Total Operating Income 8% YOY Operating Expenses 1000 400 800 852* 839 785 787 775 300 200 193 600 212 203 175 200 400 179 179 155 153 151 100 200 0 0 June 17 Sep 17 Dec 17 Mar 18 June 18 June 17 Sep 17 Dec 17 Mar 18 June 18 11 Staff Cost Other Op.Exp * Includes revenue of non recurring nature
Operating Profit (Rs. in crore) 500 8 7 47 20 26 375 472* 453 408 402 395 250 June 17 Sep 17 Dec 17 Mar 18 June 18 Core Operating Profit Trading Profit 2.9 2.9 500 3.00 2.7 2.7 2.6 450 2.50 400 350 2.00 480* 460 449 428 421 300 1.50 250 200 1.00 June 17 Sep 17 Dec 17 Mar 18 June 18 Operating Profit Operating Profit Margin% on Avg. Assets (Annualized) 12 * Includes revenue of non recurring nature
Profit and Loss A/c (Rs. in crore) Q1 Q1 Particulars YoY (%) FY 18-19 FY 17-18 Net Interest Income 584 539 8 Other Income 255 236 8 Total Income 839 775 8 Operating Expenses 379 326 16 Operating Profit 460 449 2 Provisions 423 233 81 Credit Related 378 229 65 Others 45 4 - Profit Before Tax 37 216 (83) Tax (9) 68 - Net Profit 46 148 (69) 13
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