Experience Next Generation Banking Investor Presentation June 2015 Q1 - FY16 1
Experience Next Generation Banking I MPORTANT N OTICE 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 such information or opinions contained herein. The information contained in this presentation is only current as of its date. Certain statements made in this presentation may not be based on historical information or facts and may be “forward looking statements”, including those relating to the Company‟s general business plans and strategy, its future financial condition and growth prospects, and future developments in its industry and its competitive and regulatory environment. Actual results may differ materially from these forward-looking statements due to a number of factors, including future changes or developments in the Company‟s business, its competitive environment and political, economic, legal and social conditions in India. This communication is for general information purpose only, without regard to specific objectives, financial situations and needs of any particular person. This presentation does not constitute an offer or invitation to purchase or subscribe for any shares in the Company and neither any part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. The Company may alter, modify or otherwise change in any manner the content of this presentation, without obligation to notify any person of such revision or changes. This presentation can not be copied and/or disseminated in any manner. 2
Experience Next Generation Banking Strategy: Way Forward • Strengthening long-term franchise value with focus on Retail and SME segments – Housing loans - key focus segment with centralized processing and faster approvals – Creating SME hubs focused on serving the needs of SME clientele • Focused on improving asset quality – Special cell focused on recovery from NPA accounts – Cleaned books through sale of stressed assets to Asset Reconstruction Companies (ARCs) • Strengthening deposit franchise – Improvement in core deposits – CASA continues to and is expected to improve with concerted efforts at branch level • Customer focused technology initiatives – Increase in internet, mobile and debit card transactions 3
Experience Next Generation Banking Key Performance Highlights – Q1-FY16 Rs. Crore Item Q1 - FY16 Q1 - FY15 Y-o-Y Q4 - FY15 Q-o-Q Net Interest Income 3,40.3 340.9 (0.2%) 347.1 (1.9%) Other Income 1,03.8 121.2 (14.3%) 121.9 (14.8%) Profit After Tax 65.3 126.7 (48.5%) 16.3 300.5% Advances 38,243.0 34,255.4 11.6% 37,392.0 2.3% Deposits 52,323.8 46,489.2 12.6% 51,912.0 0.8% GNPA 713.8 517.3 38.0% 643.4 10.9% NNPA 464.0 310.5 49.4% 357.0 30.0% NIM 2.54% 2.72% (6.7%) 2.70% (5.9%) CASA 22.28% 22.07% 0.9% 20.59% 8.2% 4
Experience Next Generation Banking Financial performance 5
Experience Next Generation Banking Financial Highlights – As at June 2015 Balance Sheet Overview Rs. Crore Q1-FY16 Q1-FY15 Y-o-Y (%) Q4-FY15 Q-o-Q (%) Capital & Liabilities 0.3% Capital 135 135 135 0.0% Reserves and Surplus 3,520 3,349 5.1% 3,454 1.9% 12.6% Deposits 52,324 46,489 51,912 0.8% Borrowings 1,660 2,641 (37.1%) 2,232 (25.6%) 3.0% Other Liabilities & Provisions 1,301 1,263 1,383 (5.9%) Total 58,940 53,877 9.4% 59,116 (0.3%) Assets Cash & Balances with RBI 2,417 2,260 6.9% 2,442 (1.0%) (51.7%) Balances with Banks 825 1,709 1,154 (28.5%) Investments 15,994 14,361 11.4% 16,717 (4.3%) 11.6% Advances 38,243 34,255 37,392 2.3% Fixed Assets 478 465 2.8% 479 (0.1%) 19.0% Other Assets 983 826 932 5.5% Total 58,940 53,877 9.4% 59,116 (0.3%) 12.2% Business (Advances + Deposits) 90,567 80,745 89,304 1.4% Current Accounts 2,034 1,879 8.2% 1,818 11.9% 14.8% Savings Accounts 9,622 8,382 8,868 8.5% 6 CASA Ratio 22.3% 21.2% 20.6%
Experience Next Generation Banking Financial Highlights – As at June 2015 Profit and Loss Account Rs. Crore Q1-FY16 Q1-FY15 Y-o-Y (%) Q4-FY15 Q-o-Q (%) Net Interest Income 340 341 (0.2%) 347 (1.9%) Other Income 104 121 (14.3%) 122 (14.9%) Total Income 444 462 (3.9%) 469 (5.3%) Operating Expenses 263 241 9.2% 304 (13.4%) Operating Profit 181 221 (18.1%) 165 9.6% Provisions (Ex-Tax) & Contingencies 80 95 (16.0%) 138 (42.4%) Profit Before Tax 101 126 (19.7%) 27 275.5% Provision for Tax 36 43 (16.2%) 11 228.1% Exceptional Items - (43) N/A - N/A Profit After Tax 65 127 16 (48.5%) 308.0% • Other income was driven by strong contribution from transaction fees despite the decrease from treasury • Provisions decreased mainly due to the reduction in loan loss provisions • In Q1-FY15, exceptional item refers to reversal of excess depreciation charged till March 31, 2014 (net of taxes) due to change in depreciation method from WDV to SLM 7
Experience Next Generation Banking Experience Next Generation Banking Key Metrics – Quarterly FY14 FY15 FY16 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Particulars 2.54 Net Interest Margin (NIM) (%) 2.93 3.03 3.02 3.02 2.72 2.80 2.70 2.70 CRAR Basel II (%) 11.49 13.66 13.16 12.35 12.53 12.32 12.35 11.57 12.06 RoAA (Annualized) (%) 0.94 0.97 1.02 1.00 0.93 0.75 0.71 0.56 0.45 56.13 Provision Coverage (%) 57.95 53.56 55.73 62.71 62.50 62.91 60.41 60.63 22.28 CASA (%) 20.58 21.33 21.16 20.69 22.07 22.09 21.51 20.59 Gross NPA (%) 1.85 1.57 1.92 1.66 1.19 1.50 1.55 1.80 1.71 Net NPA (%) 1.12 1.39 1.18 0.78 0.91 0.90 1.04 0.96 1.21 27.07 Book Value per Share (Rs.) 23.27 24.20 25.13 25.06 25.88 26.47 27.10 26.59 Earnings per Share (Rs.) 1.94 3.41 3.59 3.79 3.78 3.78 3.01 2.87 2.28 Branches 409 422 434 436 439 440 441 444 447 - Kerala 213 220 227 227 228 230 231 236 239 - South India (Ex-Kerala) 119 121 128 131 134 135 138 142 142 - Rest of India Total Branches 741 763 789 794 801 805 810 822 828 ATMs 475 492 512 552 565 587 607 651 670 - Kerala 230 250 265 293 295 311 323 362 - South India (Ex-Kerala) 374 125 130 137 155 158 165 178 187 - Rest of India 200 830 872 914 1,000 1,018 1,063 1,108 1,200 8 1,244 Total ATMs
Experience Next Generation Banking Deposits Breakup of Deposits CASA Ratio Rs. Crore (%) 22.1 22.3 22.1 20.6 21.5 9,151 11,258 9,579 2,034 9,326 10,560 1,818 1,826 1,859 9,622 1,879 8,868 8,598 8,456 8,382 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 NRI Deposits Rs. Crore 12,193 31,517 29,968 11,393 28,456 27,052 25,668 10,745 10,252 9,400 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Term Savings Current Others* Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 9 *Others includes: Bulk, Certificates of Deposits
Experience Next Generation Banking Deposits Core & Non-Core Deposits June-15 June-15 June-15 Rs. Crore 43,173 9,151 52,324 • Strengthening 13% core deposit 20% 13% franchise for long-term 35,929 10,560 46,489 growth June-14 June-14 June-14 Core Deposit Non-Core Deposit Total Deposit CASA Deposits Rs. Crore June-15 June-15 June-15 2,034 9,622 11,656 • Improved CASA by 14% 15% 14% 8% through concerted efforts at the 1,879 8,382 10,261 June-14 June-14 June-14 branch level Current Deposit Savings Deposit Total CASA 10
Experience Next Generation Banking Advances: Composition of Loan Book Retail SME Aggregate Loan Book R … 8,811 Rs. Crore Rs. Crore Rs. Crore 10,309 38,820 10,215 8,374 8,218 9,833 9,657 7,799 9,369 7,388 37,978 36,998 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Agriculture Corporate A … Rs. Crore Rs. Crore 35,871 4,917 16,317 15,433 15,052 4,077 14,356 3,739 13,962 3,407 34,692 3,127 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 11
Experience Next Generation Banking Gold Loan Portfolio Retail SME Rs. Crore Rs. Crore 1,127 3,665 3,441 782 2,857 614 2,485 434 337 2,003 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Agriculture Aggregate Gold Loan Portfolio Rs. Crore Rs. Crore 5,905 1,928 5,706 5,147 1,672 1,508 4,591 1,428 1,337 4,268 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Shifting focus from Gold Loan to Retail, SME, and Agriculture 12
Experience Next Generation Banking Advances: Geography wise split Kerala South Ex-Kerala Rest of India Rs. Crore Rs. Crore Rs. Crore 14,270 13,741 13,542 13,530 13,421 12,880 12,769 12,682 12,435 11,899 11,621 11,444 10,549 9,892 9,658 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Kerala franchise providing a very strong base with growth in advances led by expansion into other geographies, both in South India (ex-Kerala) and Rest of India 13
Experience Next Generation Banking Income & Profit - Quarterly Net Total Income Net Interest Income Rs. Crore Rs. Crore 480 469 358 462 347 452 341 444 340 320 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Net Profit Net Interest Margin Rs. Crore (%) 2.80 127 2.72 88 2.70 2.70 76 65 2.54 16 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 14
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