Federal Bank Ltd. (india) · NSE:FEDERALBNK
Federal Bank Ltd. (india) — The Federal Bank — Q2 FY2025 Earnings Presentation
45 slides from Federal Bank Ltd. (india)'s earnings presentation, Oct 28, 2024
Slide 1: Exchange filing cover letter - Investor Presentation
Secretarial Department SEC/LODR/283/2024-25 28.10.2024 The Manager The Manager The National Stock Exchange of India Limited Department of Corporate Services Exchange Plaza, Bandra-Kurla Complex, BSE Limited, Bandra (E), Mumbai - 400 051 Phiroze Jeejeebhoy Towers, Floor 25, Dalal Street, Mumbai- 400
Slide 2: Investor Information Q2 FY 2025
NET PROFIT INCOME HIGHEST INCOME INTEREST NET FEE EVER Investor OPERATING PROFIT Information Q2 FY 2025
Slide 3: Disclaimer
Disclaimer IMPORTANT: This presentation has been prepared by The Federal Bank Limited (the “Bank”) solely for information purposes, without regard to any specific objectives, financial situations or informational needs of any particular person. All information contained has been prepared solely by t
Slide 4: Table of Content
TABLE OF CONTENT Pages 01 Key highlights 4-10 02 Business parameters 11-22 03 Distribution strategy and digital migration 23-30 04 Appendix 31-43
Slide 5: Snapshot for Q2FY25
Snapshot for Q2FY25 ALL TIME HIGHS NET INTEREST OPERATING INCOME OTHER INCOME FEE INCOME NET PROFIT PROFIT 2367 cr 964 cr 784 cr 1057 cr 1565 cr ROA ROE EPS BVPS KEY 1.28 13.65 17.11 126.86 HIGHLIGHTS NIM Cost to Income Credit Cost Slippage Ratio FOR 3.12% 53.01% 0.30% 0.76% Q2FY25 Balance Sheet CRA
Slide 6: Propelling exceptional growth while securing lasting profitability
Propelling exceptional growth while securing lasting profitability… DEPOSITS ADVANCES PROFITABILITY Deposits: (₹ in cr) Net advances: (₹ in cr) Profitability: RoE* (%) RoA* (%) 2,66,065 2,69,107 2,20,807 2,30,312 15.72 2,32,868 YoY growth: 16% 1,92,817 13.64 13.65 QoQ growth: 1% YoY growth: 19% QoQ
Slide 7: Robust asset quality and enhanced distribution capabilities
… while ensuring robust asset quality and strategically enhancing distribution capabilities ASSET QUALITY REACH KEY CALLOUTS NPAs (%): GNPA NNPA Banking Outlets / ATMs: (Sep-24) Exceptional Business Growth Balance sheet crosses Rs. 3.35 Lakh Crore. 1,533 / 2,052* 71.03 70.79 71.82 Business size near
Slide 8: Key ratios
Key ratios Operating performance remains robust, stable asset quality with sequential improvement in Return Ratios RoA (%)* RoE (%)* Net interest margin (%)* 15.72 3.22 3.19 3.21 3.16 3.12 1.36 1.39 1.27 1.28 14.80 1.22 13.64 13.65 12.75 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q2 FY24 Q3 FY24 Q4 FY2
Slide 9: Key P&L parameters
Key P&L parameters Record high NII, complemented by highest ever other income. Net interest income Other income ₹ in cr Highest ever 2,292 2,367 Highest ever 2,123 2,195 2,056 964 915 863 730 754 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Fee income Net profit Hi
Slide 10: Comparison: Y-o-Y
Comparison: Y-o-Y ₹ in cr Retail Wholesale Retail* BuB* CVCE* COB* 17% 19% 44% 24% Advances 57,455 -> 67,440 Gold*^ 16,033 -> 19,121 Agri & Allied*^ 2,734 -> 3,932 MFI* 19,699 -> 24,493 CIB* 31% 14% 76% 10% 22,608 -> 29,722 7,052 -> 8,027 2,328 -> 4,093 70,559 -> 77,954 CASA CASA Ratio NRE Deposits
Slide 11: Comparison: Q-o-Q
Comparison: Q-o-Q ₹ in cr Retail Wholesale Retail* BuB* CVCE* COB* 4% 5% 5% 8% Advances 65,094 -> 67,440 Gold*^ 18,159 -> 19,121 Agri & Allied*^ 3,728 -> 3,932 MFI* 22,687 -> 24,493 CIB* 8% 4% 8% 2% 27,431 -> 29,722 7,684 -> 8,027 3,788 -> 4,093 76,589 -> 77,954 CASA CASA Ratio NRE Deposits Total De
Slide 12: Liability trends
CASA ratio improves by 80 bps QoQ supported by solid Liability trends growth in Resident & Non-Resident savings book. Deposits (₹ in cr) CA & SA (₹ in cr) and CASA ratio (%) CASA + Deposits < 3Cr Other YoY growth: 16% CA SA (Incl Bespoke) 2,69,107 30.07 2,52,534 2,32,868 29.38 31.17 36.94 32.68 80,9
Slide 13: Credit portfolio distribution
Credit portfolio distribution Retail book outpaced Wholesale book with a YoY growth of 22% Gross Advances (₹ in cr) Yield on advances (%) Retail Book* Wholesale Book* 2,33,820 9.35 9.43 9.35 2,12,623 1,95,968 1,77,377 1,02,447 1,47,639 95,053 90,258 YoY growth: 14% 82,699 66,744 1,19,460 1,32,335 95
Slide 14: Credit portfolio distribution
Credit portfolio distribution Loan book by interest rate type(%) Retail & SME as % of loan book (₹ in cr) EBM Fixed MCLR Others 50% 2,50,000 50.8% 50.6% 50.6% 2,00,000 50.4% 50.2% 31% 1,50,000 49.9% 49.9% 50.0% 49.7% 9% 49.8% 10% 1,00,000 49.5% 49.6% 0.5% 49.4% 0.8% 50,000 49.2% 1.4% 49.0% 0 48.8% Q
Slide 15: Retail Banking
Retail Banking Granularity built across our Retail segments; Strong-Stable-Steady Retail book mix (Sep-24) Retail advances mix (Excl Gold, BuB, Agri, CV/CE & MFI) 3% 3% (₹ in cr) 9,393 8,857 6% 8,331 3,396 2,992 3,925 7,447 3,845 2,308 3,233 8,256 14% 2,393 1,486 7,302 6,302 6,751 5,448 1,751 270 13
Slide 16: Wholesale Banking
Wholesale Banking Leveraging strong #Rishtas to drive synergies across the wholesale banking segment. Wholesale portfolio (₹ in cr) Wholesale portfolio mix (Sep-24) CoB* CIB* 1,05,305 1,00,867 95,611 86,723 Q2 FY25, CoB*, 23% 68,985 Q2 FY24, 83,238 CoB*, 21% 79,236 75,748 Q2 FY24, 69,693 Q2 FY25, CI
Slide 17: High margin lending products
High margin lending products High Yielding Segment1 Credit Cards 4 3,396 47% Gross advances 24.9% YoY growth (INRcr) 23.2% Net Advances share3 Sep-24 Personal Loans 4 3,925 Sep-23 +160 bps 21% Gross advances YoY growth (INRcr) Digital loan platform 76.8% 75.1% MSME (BuB + CoB) 43,615 688 Cr 22% Gros
Slide 18: Select high margin lending products
Select high margin lending products CV / CE Gold loans* Micro finance Portfolio (₹ in cr) YoY 27,431 29,722 YoY 3,728 3,932 YoY 3,788 4,093 22,608 2,734 44% 31% 76% 2,328 QoQ QoQ QoQ 5% 8% 8% Q2 FY24 Q1 FY25 Q2 FY25 Q2 FY24 Q1 FY25 Q2 FY25 Q2 FY24 Q1 FY25 Q2 FY25 Disbursements: PSL: No of Accounts:
Slide 19: Asset quality trends
Asset quality trends Asset quality metrics remain robust across all segments. PCR at a 16 quarters high! Std Restructured Ac Net NPA Net SR ₹ in cr Asset quality continues to remain robust across 69 all segments 1,393 0 1,205 0 0 1,230 0 Provision Coverage Ratio 1,255 increased to 71.82% 1,322 3,536
Slide 20: Asset quality trends (cont'd)
Asset quality trends (cont’d) GNPA (%) NNPA (%) PCR (%)1 2.26 2.29 0.64 0.64 71.82 2.13 2.11 2.09 0.60 0.60 0.57 71.03 71.08 71.08 70.79 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Slippage rate (%)* Risk adjusted NIM (%)* C
Slide 21: Asset quality - rating distribution
Asset quality - rating distribution Rating distribution (CIB) Rating distribution (advances excluding CIB) External rating of CIB advances Internal rating of advances excluding CIB 14% Q2 FY25 2% 12% 8% 8% 2% Q2 FY25 5% Q1 FY25 5% 17% 32% 17% 32% 78% 76% Q1 FY25 17% 17% A & Above BBB <BBB OTHERS 29%
Slide 22: Fee income / other income
Fee income / other income Diversified and granular fee income ₹ in Cr Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 QoQ YoY Loan processing fee 175 149 186 174 193 11% 10% Cards 175 181 207 191 208 9% 19% Para banking 52 63 56 46 74 60% 42% Banking commissions & exchanges 73 72 70 72 75 4% 3% General serv
Slide 23: Capital position
Capital position Adequately capitalized with a self-sustaining capital structure ₹ in Cr Jun-24 Sep-24 Risk weighted assets Credit risk 177,022 182,505 Market risk 2,629 2,616 Operational risk 17,484 17,484 Total RWA 197,135 202,605 Tier-I capital funds 27,932 28,000 Tier-II capital funds 2,762 2,80
Slide 24: Distribution: Deriving efficiency from footprint
Distribution: Deriving efficiency from footprint Consistently expanding existing network Continuous investment in expanding Pan India footprint 1 29 Sep-23 Sep-24 1 new Outlets 37 opened in H1FY25 Banking 3 2 1,408 1,533 Outlets# 30 27 2 ATMs/ 2,052 15 33 16 1,937 Recyclers* 10 3 3 63 2 LITE BRANCH
Slide 25: Innovation through partnerships
Innovation through partnerships Liability Instant Digital Partners Loans EMIs and Credit Merchant Cards Payments Gold Loan and Cross Border Priority remittance Lending partners Support Systems 24
Slide 26: Growth through partnerships
Growth through partnerships Partners Growth Share in FY’25 Key metrics1 Cards Issued: ENR: 1.3 1.4 1.4 1.2 1.2 1.2 1.2 1.2 Co-branded 1.0 1.0 credit cards 47% Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Card programs under CUG3 TD Balance CASA Balance: 7%2 1.4 1.5 1.5 1.3 1
Slide 27: Digitization as a Multiplier
Digitization as a Multiplier 512 Edu. Institutions 335 HUMAN AT THE CORE Feddy is Live on onboarded to Fee RPA Process collection Solution “Careerbook” 92% running Approx 5.5 Lakh transactions queries answered Serviced by Feddy in this Digitally (Retail 20K ₹ cr + Corporate) 790 quarter Retail Mobil
Slide 28: Digitization as a Multiplier - Major Initiatives
Digitization as a Multiplier Major Initiatives Persistently pioneering innovation by increasing DIGITAL footprints. UPI Circle Feddy knows your Language: Feddy can now respond to customer queries in This functionality allows users to “delegate” UPI 14 different Indian languages, include - Hindi, pay
Slide 29: Digital migration
Digital migration Branch vs. Digital Transactions (₹ in Lakh)* Corporate Digital Products - Active Users1 94.30% 50 ,00 0 44,658 80 00 250 93.82% 94% 40,482 42,060 219 93.60% 38,065 45 ,00 0 70 00 35,541 6,444 6593 93% 6,059 40 ,00 0 200 185 171 60 00 92.42% 147 35 ,00 0 5563 138 92% 5,111 50 00 150
Slide 30: Strengthening our presence in Transaction Banking offerings
Strengthening our presence in Transaction Banking offerings Enhanced Adoption of Digital Channels across Corporate Clients Improving Adoption 16.26% growth in transaction Improving Digital Volumes volumes over the last FY 1.99x growth in API calls recorded on a YoY basis. Growing Trade Solutions Sig
Slide 31: Digital lending and card spends
Digital lending and card spends Digital Personal Card spends (₹ in Cr)1 Loans 1,30,000 3,80 0 16 00 21 00 Credit Cards – Market share 1,24,237 1,483 1,462 1,21,718 1,429 1,380 1,20,000 1,17,607 1,16,109 3,60 0 14 00 1,345 19 00 Cards O/s: Spends: 1,713 1,701 3,567 1,07,872 1,625 1,10,000 3,40 0 12 0
Slide 32: Appendix
Appendix FEDERAL BANK YOUR PERFECT BANKING PARTNER
Slide 33: Balance sheet & shareholding pattern
Balance sheet & shareholding pattern ₹ in Cr Jun-24 Sep-24 Share holding pattern (Sep-24) LIABILITIES Capital 490 490 Reserves & surplus 30,075 30,966 Deposits 2,66,065 2,69,107 24% Borrowings 21,710 23,749 34% Other liabilities & provisions 9,632 11,231 TOTAL 3,27,971 3,35,543 2% ASSETS Cash & bala
Slide 34: Financials
Financials ₹ in Cr Q2 FY24 Q1 FY25 Q2 FY25 Q-o-Q Y-o-Y Interest income 5,455 6,331 6,577 4% 21% Interest expenses 3,399 4,039 4,210 4% 24% Net interest income 2,056 2,292 2,367 3% 15% Other income 730 915 964 5% 32% Operating expense 1,462 1,706 1,766 3% 21% Total income 6,186 7,246 7,541 4% 22% Tot
Slide 35: Key Indicators
Key Indicators Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Book Value 110.70 115.41 119.45 123.80 126.86 (Per Share in ₹) Shareholder value EPS 16.57 16.54 14.97 16.60 17.11 (annualized) CASA + Deposits < ₹3Cr Granularity (% of Total Deposits) 83% 83% 82% 80% 80% ROA % 1.36 1.39 1.22 1.27 1.28 Profitabi
Slide 36: Fresh slippages break up
Fresh slippages break up ₹ in cr Fresh slippages NPA Composition Retail Agri BuB CV/CE CoB CIB Q1 FY25 Q2 FY25 500 479 Business NPA NPA Gross NPA 450 428 78 417 Retail 1,723 1,841 17 400 33 11 Agri 930 969 365 49 12 352 63 BuB 954 948 350 42 14 23 62 CV/CE 59 66 7 7 300 74 55 CoB 620 613 88 68 71 Co
Slide 37: Top Sectors in Wholesale Advance Portfolio
Top Sectors in Wholesale Advance Portfolio Top Sector wise CB,CIB Balance O/s as a % of Gross Advances (Sep-24)* MFIs, HFCs and NBFCs other than DFIs 9.69% Trade 3.13% Services 21.13% Real Estate Activities (Other than 3.09% Residential Mortgages) Other Services 2.98% Banking and Finance other than
Slide 38: Top 20 exposure as a % of portfolio
Top 20 exposure as a % of portfolio Top 20 Depositors and Borrowers exposure as a % of total portfolio 11.15 10.94 10.71 10.77 10.89 10.65 10.32 10.11 10.03 7.51 7.43 6.87 7.03 6.66 5.83 5.19 4.51 3.42 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 % Top 20 Depositors % Top 20 Borrow
Slide 39: Group companies
Group companies Fedbank Financial Services Subsidiary Federal Operations & Services (FedServ) Subsidiary 61.16% 100% ▪ A wholly owned subsidiary company of Federal Bank ▪ Marketing Retail Asset Products of the Bank ▪ Provides operational & technology-oriented services to ▪ Retail Hubs established at
Slide 40: Fedbank Financial Services
Fedbank Financial Services Subsidiaries – Q2FY25 update NPAs Gross NPA and Net NPA stands Disbursals at 1.9% & 1.5%, respectively. ₹3,810.40 Cr disbursed in Q2FY25, KEY HIGHLIGHTS reflecting growth of 29.91% YoY. ❑ 61.16% stake held by Federal Bank Limited ❑ For Q2FY25, ROA and ROE reported at Low C
Slide 41: Corporate governance & ESG snapshot
Corporate governance & ESG snapshot Strong & Diverse 11 73% Total Board Independent Strong Board & Diverse Board Members Directors Women Women Focus on Gender 43% 18% Representation Representation diversity in workforce in the Board Diversity & Inclusion Social Responsibility Governance Structure De
Slide 42: Public Commitments
ESG performance snapshot Achieved the committed target well in advance of the deadline of March 2025. Finance women Grow green portfolio In-house solar power Water conservation Bank Premises to be Gender diversity ratio Public Commitments entrepreneurs – size generation capacity capacity green certi
Slide 43: Award-winning franchise & other initiatives / highlights
Award-winning franchise & other initiatives / highlights 'Best Use of Programmatic for Social Good’ 50 years of Rishta Celebrations - Kolkata Award Federal Bank launches India’s first QR- e4M Real Time Programmatic Advertising Awards 2024 based coin vending machine Shri. Venkatraman Venkateswaran, G
Slide 44: External ratings
External ratings Fixed Deposit A1+ (Short term) Fixed Deposit AAA Certificate of Deposit A1+ India Ratings Tier 2 (Capital) Bonds & Research Pvt Ltd, IND AA+ CARE AA+ CARE Fixed Deposits (short term) and Certificate of Deposits enjoy highest rating in that class 43
Slide 45: Thank You
Thank You 44