Indian Overseas Bank · NSE:IOB
Indian Overseas Bank — Q2 FY2019-20 Earnings Presentation
43 slides from Indian Overseas Bank's earnings presentation, Nov 4, 2019
Slide 1: Performance Analysis Q2/H1 2019-20 Analyst Presentation
इण्डियन ओवरसीज़ बैंक Indian Overseas Bank PERFORMANCE ANALYSIS Q2/H1 2019-20 Analyst Presentation
Slide 2: Our Heritage
OUR HERITAGE Indian Overseas Bank (IOB) was founded on 10th February 1937 by Shri.M.Ct.M. Chidambaram Chettyar. Objective was to specialize in foreign exchange business and take Bank across the globe. IOB started business simultaneously – at Karaikudi, Chennai and Rangoon in Burma (presently M
Slide 3: Key Strengths - Qualitative
KEY STRENGTHS - QUALITATIVE Customer Touch Points: 3272 Domestic 82 years of Banking Branches, 4 Overseas Trust of 36 million Expertise active customers Branches, 2995 ATMs, 2723 BCs Special Focus on Digital initiative and Improving CASA, strong technology Housing Loan, Jewel penetration Loan & redu
Slide 4: Highlights – Quantitative – Sept'19
HIGHLIGHTS – QUANTITATIVE – SEPT’ 19 Maintains Healthy CASA of Provision Coverage 38.06% with a Y-o-Y growth of Ratio(PCR) improved 212 bps to 75.85% from 61.97% RAM portfolio grew in Sep’18 (Y-o-Y) by 4.85% (Y-o-Y) aided by 10.68% growth in retail segment. GNPA Ratio Business per Employee reduced b
Slide 5: Top Line Movement – Sept'19
TOP LINE MOVEMENT– SEPT’19 Rs. In Crores As on YoY(%) QoQ(%) Particulars Growth Growth Sep-18 Mar-19 Jun-19 Sep-19 Savings Bank 4.73 0.18 67437 70652 70502 70628 Current Deposit 9.27 2.38 12782 14575 13643 13967 CASA Deposits 5.46 0.53 80219 85227 84145 84595 Term Deposits -3.70 0.47 142950 137307 1
Slide 6: Top Line Movement – Sept'19
TOP LINE MOVEMENT– SEPT’19 Rs. In Crores As on YoY(%) QoQ(%) Particulars Growth Growth Sep-18 Mar-19 Jun-19 Sep-19 Retail Credit 28318 31588 31053 31341 10.68 0.93 Agri Credit 5.15 1.35 32132 33353 33337 33788 MSME Credit -0.55 -0.27 32437 33164 32345 32259 -16.71 -11.74 Corporate/Others 48085 47895
Slide 7: P & L Movement – Sept'19
P & L MOVEMENT– SEPT’19 Rs. In Crores As on YoY(%) QoQ(%) Particulars Growth Growth Sep-18 Mar-19 Jun-19 Sep-19 Interest Income 4284 4556 4336 4276 -0.19 -1.38 Non Interest Income 1065 917 670 748 -29.77 11.64 Interest Expenditure 3075 3077 3048 3072 -0.10 0.79 Operating Expenses 969 1265 1130 1206
Slide 8: Highlights
HIGHLIGHTS Maintains healthy Global CASA Ratio of 38.06% and Domestic CASA Ratio of 38.47% as at Sept’ 2019. Global CASA has grown by 5% on Y-o-Y basis. Retail Term Deposit has grown by more than 3% on Q-o-Q basis. Global Deposits recorded a positive growth ( Q-o-Q) despite shedding of bulk
Slide 9: Highlights
HIGHLIGHTS Interest Income remain stable on Y-o-Y basis despite reduction in MCLR. Other income recorded a growth of 11.68% on Q-o-Q basis. Interest paid on deposits marginally increased (Q-o-Q) as a result of increase in average deposits. Operating Profit for Q2 2019-20 stood at Rs. 746 cro
Slide 10: Business Performance - Global
BUSINESS PERFORMANCE - GLOBAL Rs in Crores Particulars Mar-18 Sept-18 Mar-19 Jun-19 Sept-19 YoY(%) QoQ(%) CASA Deposits 79678 80219 85227 84145 84595 5.46 0.53 Total Deposits 216832 223169 222534 221171 222258 -0.41 0.49 Advances 150999 150040 151996 147606 143351 -4.46 -2.88 Business Mix 367831 373
Slide 11: Deposit Composition
DEPOSIT COMPOSITION Rs in Crores Parameters Mar-17 Mar-18 Sep-18 Mar-19 Jun-19 Sep-19 Savings Deposits 63232 66742 67437 70652 70502 70628 Current Deposits 13037 12936 12782 14575 13643 13967 Bulk Deposits 29195 27906 32291 28285 28958 25728 Retail Term Deposits 100514 103743 102826 105284 104834 10
Slide 12: Risk Spread - Assets
RISK SPREAD - ASSETS Rs in Crores Details March 16 March 17 March 18 Sept 18 March 19 June 19 Sep-19 Retail 22653 23887 28183 28318 31588 31053 31341 Agri 30237 29348 30820 32132 33353 33337 33788 MSME 31804 30564 32615 32437 33164 32345 32259 Corporate/Others 70734 58852 46898 48085 47895 45375 400
Slide 13: Retail Performance
RETAIL PERFORMANCE Rs in Crores SHARE OF RETAIL ON TOTAL ADVANCES 180000 21.64% 25.00% 160000 20.34% 21.86% 140000 16.75% 20.00% 120000 14.57% 11.07% 15.00% 100000 80000 11.17% 10.00% 60000 40000 5.00% 20000 0 0.00% Mar'14 Mar'15 Mar'16 Mar'17 Mar ’18 Mar-19 Sep-19 Gross Domestic Retail Advance % Sh
Slide 14: Priority Sector Advances - Overview
PRIORITY SECTOR ADVANCES - OVERVIEW 60.00% Priority sector % 81000 51.33% 50.22% FY Achievement achievement 47.47% 75851 50.00% 71000 40.33% 75390 2016-17 70040 61000 63984 40.00% (Avg of 4 Qtrs) 63984 40.33% 51000 41000 30.00% 2017-18 31000 (Avg of 4 Qtrs) 70040 47.47% 20.00% 21000 10.00% 2018-19 1
Slide 15: Agriculture Advance Performance
AGRICULTURE ADVANCE PERFORMANCE % of Y-o-Y Growth Oustanding 3000 10.00% 35000 33340 33788 8.18% 6.59% 2500 8.00% 34000 4.69% 2000 33000 6.00% +2520 5.15% 30820 1500 +138 32000 4.00% 2 +178 1000 31000 0 29438 2.00% 30000 500 0.00% 29000 0 2016-17 2017-18 2018-19 Sep'18 Sep'19 28000 -500 -2.00% -798
Slide 16: Agri Advances – Priority Sector
AGRI ADVANCES – PRIORITY SECTOR 32000 18.02% 18.18% 20.23% 21.14% 20.74% 20.57% 31000 22.00% 30205 31045 30632 31070 30000 30236 29851 21.00% 29000 28585 28000 28865 27189 20.00% 27000 26561 26438 26583 19.00% 26000 18.00% 25000 17.00% 24000 23000 16.00% 22000 15.00% 2015-16 2016-17 2017-18 2018-19
Slide 17: MSME Performance
MSME PERFORMANCE Rs in Crores Share of MSME on Domestic Advances 23.55% Gross 180000 21.43% 22.71% 24.00% MSME 162837 23.01% 22.62% FY Domestic % Share 160000 155428 Advance 142651 138516 140973 146001 142987 143356 23.00% adv 140000 22.50% Mar'15 162837 32251 19.81% 22.00% 120000 Mar'16 155428 3180
Slide 18: Income & Expenses
INCOME & EXPENSES Rs in Crores Q2 Q4 Q1 Q2 YoY QoQ Particulars 18-19 18-19 19-20 19-20 (%) (%) Interest Income 4284 4556 4336 4276 -0.20 -1.40 Non Interest Income 1065 917 670 748 -29.73 11.68 Total Income 5349 5474 5006 5024 -6.08 0.35 Interest Expended 3075 3077 3048 3072 -0.10 0.79 Staff Expenses
Slide 19: Profitability
PROFITABILITY Rs in Crores Q2 Q4 Q1 Q2 YoY QoQ Particulars 2018-19 2018-19 2019-20 2019-20 (%) (%) Operating Profit 1304 1132 828 746 -42.79 -9.9 Provisions 1791 3117 1170 3000 67.50 156.4 of which NPA Provisions 1678 3961 1259 2734 62.93 117.2 Other Provisions 113 -844 -89 266 135.40 398.9 Net Prof
Slide 20: Other Income
OTHER INCOME Rs in Crores Q2 H1 Q1 Q2 H1 YoY QoQ Particulars 18-19 18-19 19-20 19-20 19-20 (%) (%) Exchange & Commission 254 465 201 220 421 -9.42 9.56 Proft on Sale of Investments 10 82 181 88 269 227.12 -51.26 Profit on Exchange 137 256 167 134 301 17.53 -19.81 All other income 664 1340 122 306 42
Slide 21: Profitability Metrics
PROFITABILITY METRICS Rs in Crore Total Income/Non Interest Income/% Operating Profit/Total Income/Total Expense Share of Non Interest Income 5689 5689 1700 5348 5474 6000 6000 5348 5474 25.00 5006 5006 5024 5024 1466 5000 1500 5000 19.91 20.15 20.00 1304 4342 4000 16.76 1300 4000 14.89 15.00 4278 1
Slide 22: Performance Ratio
PERFORMANCE RATIO Cost of Deposits (%) Yield on Advances 5.43 7.60 7.31 7.22 7.12 7.13 7.13 5.41 6.95 7.10 5.40 5.40 5.39 6.60 5.37 6.10 5.37 5.60 5.34 5.10 Q2 18-19 Q4 18-19 Q1 19-20 Q2 19-20 June 18 Sept 18 Dec 18 Mar 19 June 19 Sept 19 Net Interest Margin Cost to Income Ratio 2.40 61.79 2.31 57.7
Slide 23: NPA Management
NPA MANAGEMENT Rs in Crores FY Q2 FY Q1 Q2 Details 17-18 18-19 18-19 19-20 19-20 i) Opening Gross NPAs 35098 38146 38180 33398 33262 a. Cash Recoveries 1105 1723 3673 483 552 b. Upgradation 2330 342 1452 431 291 c. Write-Offs 7018 1425 7683 1171 5689 d. Sale to ARCs 3254 289 708 0 13 e. Other Reduct
Slide 24: Movement of NPA
MOVEMENT OF NPA GNPA Movement NNPA Movement 30 18 25.28 24.73 15.33 22.53 16 14.34 25 21.97 20 14 20 12 10.81 11.04 9.84 15 10 8 10 6 5 4 2 0 0 FY Q2 FY Q1 Q2 FY Q2 FY Q1 Q2 17-18 18-19 18-19 19-20 19-20 17-18 18-19 18-19 19-20 19-20 Gross NPA (%) Net NPA (%) Provision Coverage Ratio 80 75.85 71.39
Slide 25: Movement of RWA & CRAR
MOVEMENT OF RWA & CRAR Rs in Crores Particulars Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Market Risk RWA 15189 15189 14859 12538 11944 11320 11950 Operational Risk 14759 14759 15779 15779 15779 16642 16642 RWA Credit Risk RWA 104960 104960 96903 96770 94862 93196 91846 Total RWA (A) 134909 1
Slide 26: Capital Conservation
CAPITAL CONSERVATION RAM Share to Domestic Advances 80.00 70.86 CRAR 67.20 68.07 12.50% 11.86% 70.00 66.14 12.00% 58.74 11.50% 60.00 54.49 11.00% 48.83 10.21% 10.02% 50.00 10.50% 10.00% 40.00 9.50% 30.00 9.00% 8.50% 7.98% 20.00 8.00% 7.50% 10.00 Jun-18 Mar-19 Jun-19 Sep-19 0.00 Mar-15 Mar-16 Mar-17
Slide 27: Movement of External Rated Corporate Borrower Accounts
MOVEMENT OF EXTERNAL RATED CORPORATE BORROWER ACCOUNTS Rs in Crores Sep-18 Jun-19 Sep-19 Investment Grade % to % to gross Exposur % to Exposure gross Exposure Adv e gross Adv Adv AAA 4130 2.8% 4258 2.9% 5489 3.8% AA 4293 2.9% 3873 2.6% 4348 3.0% A 4338 2.9% 5985 4.1% 6015 4.2% Sub Total 12760 8.5% 1
Slide 28: Investments
INVESTMENTS Rs in Crores Global Investments 79697 76573 72248 70263 69209 Mar-17 Mar-18 Sep-18 Mar-19 Sep-19 Parameters Mar-16 Mar-17 Mar-18 Sep-18 Mar-19 Sep-19 Domestic Investments 76155 68627 66619 72008 65380 76159 SLR 64028 58009 53019 56259 47858 54642 Non SLR 12127 10618 13600 15749 17522 215
Slide 29: Strategic Investments – Joint Venture
STRATEGIC INVESTMENTS – JOINT VENTURE IOB entered into Non Life Insurance Business with Universal Sompo General Insurance (USGI) Company Limited with equity participation of 18% along with the other Banks and Institutions Shareholding Shareholding % Name of Entity Investment % 6.00% 12.81% 18.06% In
Slide 30: Valuations
VALUATIONS Q2 Q1 Q2 Particulars (Rs. Crs) 2018-19 2019-20 2019-20 Earning per Share (`) -Ve -ve -ve Book Value per Share (`) 7.16 6.05 3.66 Adjusted Book Value per Share (`) [(Net Worth - Net -ve -ve -ve NPA)/No of Shares] Price/Book Value (`) 1.83 2.01 2.56 Price/Adjusted Book Value (`) -Ve -Ve -ve
Slide 31: Financial Inclusion
FINANCIAL INCLUSION No of PMJDY ACCOUNTS PMJDY Account Balance 1192 1117 4994750 4849392 818 757 4387956 4261330 Mar-17 Mar-18 Mar-19 Sep-19 Mar-17 Mar-18 Mar-19 Sep-19 PMJDY ZERO BALANCE ACCOUNTS Jan Suraksha & APY Enrolments 3049713 3104602 1155960 2688716 2773384 Pmjjby Pmsby 1004976 1014385 9827
Slide 32: Customer Touch Points
CUSTOMER TOUCH POINTS 4000 3500 Year Branches ATM/CR IOB Mitra 3000 Mar-15 3381 3571 2841 2500 Mar-16 3397 3793 2894 2000 Branches Mar-17 3373 3679 2738 1500 ATM Mar-18 3332 3552 2663 1000 BC Mar-19 3280 3450 2705 500 Jun-19 3274 3011 2705 0 Sept-19 3272 2995 2723 BC: IOB Mitra CR: Cash Recyclers Br
Slide 33: Global Footprints – Foreign Branches
GLOBAL FOOTPRINTS – FOREIGN BRANCHES Branches Representative Office JV Subsidiary Remittance Centres Singapore HongKong Singapore – Serangoon Dubai Malaysia Colombo Road Bangkok Joint Venture in Malaysia: Joint Venture with Bank of Baroda (40%) and Andhra Bank (25%) with IOB share of 35% GLOBAL FOOT
Slide 34: Performance Analysis Q2/H1 2019-20
Performance Analysis Q2/H1 2019-20
Slide 35: Digital Initiatives
DIGITAL INITIATIVES Performance Analysis Q2/H1 2019-20 Page 32
Slide 36: New Digital Banking Products: Bank on Wheels
NEW DIGITAL BANKING PRODUCTS BANK ON WHEELS As per EASE guidelines, each bank has to provide Mobile ATM facility (Bank on Wheels) in all districts where they are the lead banks. Indian Overseas Bank has brought Banking Services on wheels to rural and Semi-Urban areas of Tamil Nadu and Kerala in 14
Slide 37: New Digital Banking Products: Cheque Lodgement Kiosk
NEW DIGITAL BANKING PRODUCTS CHEQUE LODGEMENT KIOSK To enhance customer service and with committed “Customer First” concept, IOB has launched self service Cheque Lodgement Kiosks at major commercial centers to facilitate round the clock acceptance of clearing cheques. These kiosks are fully inte
Slide 38: Customer Experience Initiatives
CUSTOMER EXPERIENCE INITIATIVES Customer can call to the specified number for to provide a feedback about our service If you are unhappy with our service please call 8828846220 If you are happy with our service please call 8828846225 Customer can give missed call to 9210622122 to know your acco
Slide 39: Customer Experience Initiatives
CUSTOMER EXPERIENCE INITIATIVES Phone Banking Services initiated in 50 Branches Pan India Door Step Banking Services introduced in selected Branches Pan India Performance Analysis Q2/H1 2019-20 Page 36
Slide 40: Awards & Accolades
AWARDS & ACCOLADES Awarded by MeitY for Outstanding Performance in POS deployment in Northeast for the FY 2018-19. Our Bank has been awarded as one of the Best Performing Bank under the Special Campaign “Warriors of Winning Wednesday-August 2019” by PFRDA for achieving the Target under APY. Perfor
Slide 41: Disclaimer
DISCLAIMER Except for the historical information contained herein, statements in this release which contain words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “fut
Slide 42: Performance Analysis Q2/H1 2019-20
Performance Analysis Q2/H1 2019-20
Slide 43: Thank You
THANK YOU Performance Analysis Q2/H1 2019-20
Indian Overseas Bank — Q2 FY2019-20 Earnings Presentation on 6ix