Union Bank Of India Limited · NSE:UNIONBANK
Union Bank Of India — Q4 FY20 Earnings Presentation
61 slides from Union Bank Of India's earnings presentation, Jun 23, 2020
Slide 1: Exchange filing cover letter
0 0Union Bank 71.ina'?,~ Ref: ISDl20-21 I 7 2 .June 23, 2020 The Deputy General Manager, The Deputy General Manager, Corporate Relationships Dept. Listing Dept. BSE Ltd. National Stock Exchange o f India Ltd. Phiroze Jeejeebhoy Towers, Exchange Plaza, Plot No.CI1, G Block Dalal Street, Bandra-Kurla
Slide 2: Financial Results Q4FY20/FY 2019-20
Financial Results Q4FY20/FY 2019-20 June 23, 2020 Please follow us on: @unionbankofindia @UnionBank Tweets UnionBankInsta UnionBankofIndiaUtube UnionBankofIndia
Slide 3: Table of Contents
Table of Contents 1 Business Performance 2 Financials 3 Update on Amalgamation 4 Response to COVID 19 5 Strategic Initiatives 6 Group Entities 2
Slide 4: Performance Highlights – FY20
Performance Highlights – FY20 Key Parameters (YoY Growth) Key Ratios Total Business Gross Advance Rs. 797589 cr Rs. 346921 cr Total Deposit Operating Profit Rs. 450668 cr Rs. 9181 cr Capital Adequacy (Basel III) Improving Asset Quality CRAR NNPA 12.81% 5.49% 3
Slide 5: Business Performance - Liabilities
Business Performance - Liabilities (` crore) Total Deposit 415915 442879 445091 450668 3649 8.4% YOY 3435 3541 2816 441550 447019 8.2% 439444 YOY 413099 Mar-19 Sep-19 Dec-19 Mar-20 Domestic deposit Overseas deposit CASA Portfolio 34.7% 34.2% 34.1% 34.2% CASA+Retail TD as % of Total Domestic 36.1% 33
Slide 6: Business Performance - Assets
Business Performance - Assets (` crore) Proportion of Gross Advance – Mar 20 Gross Advances 336064 346921 325392 327057 6.6% YOY 20.3% 20696 19156 14460 17608 48.0% 17.4% 4.9% 316908 326225 310932 309449 YOY 14.3% Mar-19 Sep-19 Dec-19 Mar-20 Corporate & Others Agriculture Retail MSME Overseas advanc
Slide 7: Diversified Loan Portfolio - RAM
Diversified Loan Portfolio - RAM RAM* share (%) in Domestic advances Retail 57.0 57.1 55.7 55.3 26.3 48.4 3.8 8.0 6.0 7.4 Mar-19 Sep-19 Dec-19 May 20 Home Vehicle Education Mortgage Personal Others (incl. HFC+Staff loans) *Retail, Agriculture and MSME collectively called as “RAM sector” 6
Slide 8: Diversified Loan Portfolio - RAM
Diversified Loan Portfolio - RAM Composition of Agri loan book(%) 37 36 37 37 More than 63% of Agri. portfolio is 63 64 63 63 for Small & Marginal farmers Mar-19 Sep-19 Dec - 19 Mar-20 Small & Marginal Other Agri Composition of MSME loan book(%) 25 26 24 24 76% of 41 40 42 44 MSME portfolio is 34
Slide 9: Diversified Loan Portfolio-Industry Exposure
Diversified Loan Portfolio-Industry Exposure Top Sector Exposure S No. Sectors (% Share in Domestic Advance) Dec-19 Mar-20 ` Crore % Share ` Crore % Share 1 Infrastructure 52270 16.5 51304 15.7 2 NBFCs and HFCs 46687 14.7 45159 13.8 w/w HFCs 17081 5.4 13396 4.1 3 Trade 38909 12.3 44265 13.6 4 Basic
Slide 10: NBFC Portfolio
NBFC Portfolio Total FB O/s NBFCs –45159 cr NBFC Asset Quality w/w HFCs – 13396 cr 6.06% Quality of Standard Assets-NBFC 93.94% Comapnies Backed 13.60% by Govt/PSUs Standard Asset NPA 0.4% 0.0% 5.2% 1.0% Pvt Sector Companies 86.40% 94.5% 99.0% NBFC (excl HFC) HFC Below BBB BBB A & Above 9
Slide 11: Investments
Investments Global Investment (` Crore) 128415 170781 162598 154866 25 27 27 31 75 73 73 69 Mar-19 Sep-19 Dec-19 Mar -20 Non-SLR(%) SLR(%) Duration Particulars (Domestic) Dec 2019 Mar 2020 (Years) (` Crore) (` Crore) Dec-19 Mar-20 Available for Sale 50,765 45,864 3.22 2.24 W/w SLR 29,880 20,985 3.40
Slide 12: Overseas Operations
Overseas Operations Business from Overseas Operations Growth (%) US $ in billion Mar Dec Mar (` crore) 2019 2019 2020 Y-o-Y Y-o-Y (US$) (INR) 2.4 3.18 3.21 Total Business 33.3 40.9 (17276) (22697) (24345) 0.4 0.49 0.48 Total Deposits 25.0 29.6 (2816) (3541) (3649) 2.0 2.68 2.73 Total Advances 36.5 4
Slide 13: Financial Inclusion
Financial Inclusion Total PMJDY Accounts Balance in PMJDY A/Cs (no. in Lacs) (Rs. in Crs) 112 110 3031 107 2665 2404 2453 98 Mar-19 Sep-19 Dec-19 Mar-20 Mar-19 Sep-19 Dec-19 Mar-20 Micro Insurance & APY - Fresh Enrolments (In Lacs) 5.18 Terminal Figures (in Lacs) Mar 19 Mar 20 2.19 2.36 PMJJBY 14.22
Slide 14: Progress under Government Initiatives
Progress under Government Initiatives Total outstanding under Mudra loan: ` 7663 crore Progress under Mudra Yojana April to March 2020 (PMMY) No. of Sanctioned Amount Outstanding Amount Category Accounts (` crore) (` crore) Shishu (< 50k) 54193 111 77 Kishor (Above 50k-5 Lacs) 96671 2077 1690 Tarun
Slide 15: Statement of Assets & Liabilities
Statement of Assets & Liabilities (` crore) As at As at As at As at Growth (%) 31.03.19 30.09.19 31.12.19 31.03.20 Y-o-Y Q-o-Q LIABILITIES Capital 1763 1763 3423 3423 94.2 -- Reserves and surplus 24724 23635 34241 30363 22.8 -11.3 Share application 0 11768 0 0 -- -- Deposits 415915 442879 445091 450
Slide 16: Financials
1 Business Performance 2 Financials 3 Update on Amalgamation 4 Response to COVID 19 5 Strategic Initiatives 6 Group Entities 15
Slide 17: Cost & Yield Ratio
Cost & Yield Ratio Parameters Mar-19 (Q4) Dec-19 (Q3) Mar-20 (Q4) FY - 2019 FY - 2020 Domestic Global Domestic Global Domestic Global Domestic Global Domestic Global Cost of Deposit 5.68 5.66 5.55 5.53 5.48 5.46 5.59 5.57 5.59 5.56 Cost of Funds 4.73 4.63 4.75 4.69 4.59 4.51 4.89 4.79 4.77 4.72 Yiel
Slide 18: Movement of NIM
Movement of NIM NIM Quarterly NIM Quarterly (on Avg. Earning Assets) (on AEA excl.GNPA) 2.55 2.47 2.38 2.27 2.44 2.35 2.3 2.22 2.54 2.61 2.74 2.46 Mar-19 Sep-19 Dec-19 Mar-20 Mar-19 Sep-19 Dec-19 Mar-20 NIM Domestic NIM Global Global NIM (Full Year) NIM (Full Year) (on Avg. Earning Assets) (on AEA e
Slide 19: Net Interest Income
Net Interest Income (` crore) Quarterly 3134 2906 2878 10.6% YoY 2602 Mar-19 Sep-19 Dec-19 Mar-20 12.0% YoY 11437 10215 FY 2019 FY 2020 18
Slide 20: Operating Revenues
Operating Revenues Growth Growth Mar-19 Sep-19 Dec-19 Mar-20 Growth Parameters (%) (%) FY 19 FY 20 (Q4) (Q2) (Q3) (Q4) (%) YoY QoQ Interest Income 8349 9414 9630 9289 11.3% -3.5% 34067 37231 9.3% Interest Expense 5748 6508 6496 6411 11.5% -1.3% 23852 25794 8.1% Net Interest Income 2602 2906 3134 287
Slide 21: Non Interest Income
Non Interest Income Growth Growth Mar-19 Sep-19 Dec-19 Mar-20 Growth Parameters (%) (%) FY 19 FY 20 (Q4) (Q2) (Q3) (Q4) (%) YoY QoQ a. Core Non Interest Income 868 605 649 826 -4.7% 27.5% 2688 2561 -4.7% b. Treasury Income 266 379 135 895 236.5% 563.0% 899 1754 95.1% W/w Profit on Sale of 188 292
Slide 22: Fee Income
Fee Income Growth Growth Mar-19 Sep-19 Dec-19 Mar-20 Growth Parameters (%) (%) FY 19 FY 20 (Q4) (Q2) (Q3) (Q4) (%) YoY QoQ Core Non Interest Income 868 605 649 826 -4.7% 27.5% 2688 2561 -4.7% W/w Processing Charges on 131 112 124 153 17.1 23.8 447 473 6.0 Advances Commission of LC/BG (Inland) 129 11
Slide 23: Operating Profit
Operating Profit (` crore) Operating Profit(Quarterly) 53.3% YoY 2653 2240 2402 1730 Mar-19 Sep-19 Dec-19 Mar-20 Operating Profit (Full Year) 9181 22.1% YoY 7521 FY 2019 FY 2020 22
Slide 24: Provisions
Provisions (` crore) Mar-19 Sep-19 Dec-19 Mar-20 Parameters FY19 FY20 (Q4) (Q2) (Q3) (Q4) NPAs 5783 3328 1570 5485 11435 11814 Standard Assets 21 570 -255 287 137 504 Depreciation on Investment -26 -91 265 120 -404 372 Shifting Loss 0 0 0 0 411 4 Restructured Advances -102 -21 -26 6 -356 -17 Others
Slide 25: Net Profit
Net Profit Net profit(Quarterly) (` crore) 575 Mar-19 Sep-19 Dec-19 Mar-20 -1194 -2503 -3370 Net Profit(Full Year) FY 2019 FY 2020 -2898 -2948 24
Slide 26: Efficiency/Profitability Ratios
Efficiency/Profitability Ratios Return on Avg. Assets (%) Cost to Income(%) 0.41 55.3 44.7 45.8 48.8 43.4 45.0 Mar-19 Sep-19 Dec-19 Mar-20 FY 19 FY20 (Q4) (Q2) (Q3) (Q4) -0.53 -0.59 -0.87 Mar-19 Sep-19 Dec-19 Mar-20 FY 19 FY20 -2.71 -1.76 (Q4) (Q2) (Q3) (Q4) S. Mar-19 Sep-19 Dec-19 Mar-20 Efficiency
Slide 27: Efficiency Ratios
Efficiency Ratios Mar-19 Sep-19 Dec-19 Mar-20 Sn. Profitability Parameters FY 19 FY 20 (Q4) (Q2) (Q3) (Q4) Business per 1 ` crore 172.7 179.7 182.3 186.2 172.7 186.2 Branch Business per 2 ` crore 19.9 20.3 20.8 20.4 19.9 20.1 employee Gross Profit per 3 ` crore 1.6 2.1 2.2 2.5 1.8 2.1 Branch Gross P
Slide 28: Asset Quality: Movement in Non Performing Assets
Asset Quality: Movement in Non Performing Assets (` crore) Mar-19 Sep-19 Dec-19 Mar-20 Parameters FY 19 FY 20 (Q4) (Q2) (Q3) (Q4) Gross NPAs - Opening 49713 48812 49850 49924 49370 48729 Add : Additions 3275 4219 5112 2490 13577 14911 Less: Reductions 4259 3181 5038 3329 14218 14555 1. Recoveries 76
Slide 29: Asset Quality: Sectoral
Asset Quality: Sectoral (` crore) Sectoral NPA % Slippages During Sectors NPAs Mar 20 Q4 FY 20 Sep-19 Dec-19 Mar-20 Retail Loans 143 1587 2.76 2.64 2.62 Agriculture 556 5880 11.32 11.86 11.85 Micro & Small (MSE) 1031 8331 13.4 14.57 15.67 Medium & Large 760 33287 23.6 22.74 20.42 Total 2490 49085 15
Slide 30: Asset Quality: Sectoral
Asset Quality: Sectoral Standard as on Dec 2019 Standard as on Mar 2020 Scheme Amount Amount Account Account (Rs. in crore) (Rs. in crore) 5:25 10 3404 10 3488 SDR 1 0 1 0 S4A 1 12 1 13 *Account is Non-Fund Based S.N. Sector # Outstanding NPA Std. Restructured NPA + Std. Restructured (%) 1 Infrastru
Slide 31: Status of NCLT Accounts
Status of NCLT Accounts RBI List 1 O/s Rs. 3835 cr (7 A/c) PCR on NCLT Accounts RBI List 2 O/s Rs. 3139 cr (14 A/c) 100% 99% 80% 85% Others - Admitted Rs. 19339 cr (215 A/c) RBI List I RBI List II Others Total Total Rs. 26314 cr (236 A/c) 30
Slide 32: Basel III : Capital Adequacy
Basel III : Capital Adequacy 32796 44160 43961 37790 278344 291613 298802 294984 15.14 14.71 12.81 11.78 11.46 11.35 8.02 9.40 12.83 12.69 9.48 10.75 Mar-19 Sep-19 Dec-19 Mar-20 CET-1 Tier I CRAR RWA Capital funds RWA Optimization 89.2 88.9 85.5 85.0 56.3 54.8 56.4 53.6 Mar-19 Sep-19 Dec-19 Mar-20 R
Slide 33: Shareholding Pattern
Shareholding Pattern March 2020 Share Capital ` 3423 crore Govt. of 1.28% India 5.60% 6.37% No. of Equity Shares ` 342.28 crore FIIs Net Worth ` 23153 crore DIIs 86.75% Market Cap ` 9823 crore Public & others 32
Slide 34: Capital Structure - AE
Capital Structure - AE Equity Share Exchange Ratio Shareholding Pattern Pre & Post Amalgamation Post Pre - Amalgamation Amalgamation • 325 equity share of face value of Rs.10 each fully paid up capital in Union Bank of India for every 1000 equity shares of (in crore) 31.12.19 31.03.20 01.04.20 the f
Slide 35: Update on Amalgamation
1 Business Performance 2 Financials 3 Update on Amalgamation 4 Response to COVID 19 5 Strategic Initiatives 6 Group Entities 34
Slide 36: Amalgamation: Bringing rich legacies together
Amalgamation: Bringing rich legacies together The standing of resultant entity; Post amalgamation of Andhra Bank and Corporation Bank with Union Bank w.e.f April 01,2020 Combined, we have a strong legacy with 310 years of experience Good people to bank with Celebrating our 100 Years of existence F
Slide 37: Strength of different entities
Strength of different entities • Strong CA franchise: • Strong Agri portfolio Highest CA ratio (9%) & • Strength in fee income high avg. balance per • High deposit market share • Strong risk CA in AP, Telangana management practices • Aggressive POS • Good starting in position in • Strong Savings A/C
Slide 38: Amalgamation: Standing of Amalgamated Entity
Amalgamation: Standing of Amalgamated Entity 9500+ Branches 13300+ ATMs 8000+ BC points Wider reach of the amalgamated 120+ Mn Customers bank to drive this vision 75,000+ Employees 37
Slide 39: Amalgamation – Setting up the vision
Amalgamation – Setting up the vision 1 Large scale, 5th largest PSB with best-in-class products and digital services Employer of choice with upskilled and productive 2 workforce Setting up the Enhanced value delivery for shareholders, investors and vision of best in 3 stakeholders class bank 4 Great
Slide 40: Amalgamation- Industry best team
Amalgamation- Industry best team Industry best team of consultants in place to drive the amalgamation The Boston Consulting Group (Overall Infosys Amalgamation) (Core Banking) Cyriil Amarchand Ernst & Young Mangaldas (IT Amalgamation) (Legal Due Diligence and Advisory) 39
Slide 41: Amalgamation- Progress so far
Amalgamation- Progress so far Amalgamation progressing with great pace with major integration milestones completed by 1st April 2020 (AED) Harmonized product Systems critical for Refined Field Structure suite live on entire credit processing and Organizational devised and rolled branch network HR in
Slide 42: Amalgamation- Customer Delight
Amalgamation- Customer Delight Customers to gain from amalgamation across all fronts Enhanced Domestic & Enhanced Products & Enhanced Customer Global Presence Services Centricity • Large domestic banking • Greater focus on • Revamped organization network with 9500+ digitization of processes structur
Slide 43: Amalgamation- Gain for investors
Amalgamation- Gain for investors Investors to gain from growth focused cost-effective Bank Faster Growth Reduced Costs Improved Financials • Improved CASA • Optimization of • Improved cost of deposits in core physical distribution funding due to higher home-states of network deposit market share in
Slide 44: Amalgamation- Market Share
20 Andhra Pradesh 14 Telangana 11 Goa 9 Odisha 8 Uttar Pradesh 8 Madhya Pradesh 8 Karnataka 7 Chattisgarh 7 Maharashtra 6 Delhi 6 Sikkim 5 Gujarat 5 Chandigarh 5 Kerala 5 West Bengal 4 Uttarakhand 4 Haryana 4 Jharkhand 4 Tamil Nadu 4 Punjab Amalgamation- Market Share State wise % market share of ama
Slide 45: Amalgamation-Way forward
Amalgamation-Way forward Union Bank of India - Way Forward Agile Organization India's leading Digital Employer of Structure Bank Choice • Reorganization of Zonal Offices & • Digitization vertical to focus on • People's Survey to understand Regional Offices already underway digital employee and custo
Slide 46: Response to COVID 19
1 Business Performance 2 Financials 3 Update on Amalgamation 4 Response to COVID 19 5 Strategic Initiatives - Outcome 6 Group Entities 45
Slide 47: COVID 19: Bank Response
COVID 19: Bank Response Average 98% branches and 88% ATMs remained operational Redirecting customers to digital platforms Vigorous measures (protective gears/sanitization) adopted for safety of employees and clients ` 7.58 crores donated to PM Cares fund by Bank Employees 46
Slide 48: COVID 19: Bank Response
COVID 19: Bank Response Union Bank of India is helping customers to tide over the liquidity crisis through various schemes COVID Emergency Line of Credit (CELC) Union COVID -19 Personal Loan Scheme (UCPLS) Union SHG COVID Suvidha Loan (USCSL) Union Guaranteed Emergency Credit Line (UGECL) Liberalise
Slide 49: Strategic Initiatives
1 Business Performance 2 Financials 3 Update on Amalgamation 4 Response to COVID 19 5 Strategic Initiatives 6 Group Entities 48
Slide 50: Strategic Initiatives
Strategic Initiatives More than 78% of Credit Appraisal centralized Structural Development: Creation of Centralized Processing Centres (CPCs) Particul No. of Units No. of Units No. of Units Sectors covered ars (Sep-19) (Dec-19) (Mar-20) Retail (Housing and Mortgage ULP 75 75 75 Loan) USK 45 52 62 Re
Slide 51: Strategic Initiatives
Strategic Initiatives Rated Advances - Lending to higher rated borrowers… Maintained rating profile of new retail loans sanctioned Rating Matrix of Outstanding Corporate Loans (> `5 crore) Retail CIBIL Rating Profile `142547 ` 171325 46 13 59 26 14 15 28 23 72 58 26 18 Mar-17 Mar-20 FY 17 FY 20 A &
Slide 52: ESG Practices
ESG Practices • Comprehensive campaign ‘GO- • Adopted ¬211 villages across the • Our code of Corporate GREEN’ was launched in the FY country: Under Union Adarsh Gram Governance ensures highest level 2019-20 – 86905 and 43374 scheme. of ethics, integrity, risk saplings were planted under Union • Prov
Slide 53: Strategic Initiatives
Strategic Initiatives 1 Online digital platform for settlements of NPA accounts 2 Early Warning System in place for monitoring of advances; covering 90% of loan book 3 Specialised Monitoring Agencies for monitoring of Large loans Large list of Services and functionalities provided through alternate
Slide 54: Digital Banking - Growth
Digital Banking - Growth Digital Transactions Growth Merchant Acquiring Multiple payment acceptance modes such as PoS, Bharat QR, Aadhaar Pay, Payment Gateway available to merchants 55246 PoS terminals installed in the ecosystem as payment accepting infrastructure 21541 merchants availing Aadhaar 77
Slide 55: Social Media
Social Media Social Media Presence 1481354 145581 63221 32197 15679 TIE - UPS
Slide 56: Group Entities
1 Business Performance 2 Financials 3 Update on Amalgamation 4 Response to COVID 19 5 Strategic Initiatives - Outcome 6 Group Entities 55
Slide 57: Performance of Subsidiaries, JVs & Associates
Performance of Subsidiaries, JVs & Associates Type Name Subsidiary Union Bank of India (UK) Limited Subsidiary Union Asset Management Co. Private Limited Subsidiary Union Trustee Co. Pvt. Limited Joint Venture Star Union Dai-ichi Life Insurance Co. Limited Associate Kashi Gomti Samyut Gramin Bank 56
Slide 58: Details of Group Entities
Details of Group Entities (` crore) Subsidiaries Union Bank of India (UK) Limited Bank‟s Particulars FY19 FY20 • Wholly owned subsidiary operating in UK Shareholding • Equity Investment – 1005.43 crores Total Income 151.28 118.96 Net Profit/ (Loss) (15.87) (160.10) 100% Total Assets 3312.61 3356.55
Slide 59: Details of Group Entities
Details of Group Entities (` crore) Subsidiaries Union Trustee Co. Pvt. Limited Bank‟s Particulars FY19 FY20 • Wholly owned subsidiary Shareholding • Equity Investment – 0.05 crores Total Income 0.20 0.20 Net Profit/ (Loss) 0.02 (0.01) 100% Total Assets 0.13 0.12 Capital & Reserves 0.10 0.10 Joint V
Slide 60: Disclaimer
Disclaimer Except for the historical information contained herein, statements in this presentation which contain words or phrases such as “is”, “aims”, „will‟, „would‟, „indicating‟, „expected to‟ etc., and similar expressions or variations of such expressions may constitute „forward-looking stateme
Slide 61: Investor queries: investor.relations@unionbankofindia.com
Investor queries: investor.relations@unionbankofindia.com 60