South Indian Bank Limited · NSE:SOUTHBANK
South Indian Bank — The South Indian Bank — Q4 FY20 Earnings Presentation
60 slides from South Indian Bank's earnings presentation, Jun 26, 2020
Slide 1: Cover letter to stock exchanges: Presentation to Investors and Analysts
~ ~SOUTH ~INDIAN Bank DEPT: SECRETARIAL REF No. SEC/ST EX.STT/31 /2020-21 June 26, 2020 National Stock Exchange oflndia Ltd., Exchange Plaza, 5th Floor, Plot No.C/1, G Block, Bandra-Kurla Complex,Bandra (E), Mumbai- 400 051. SCRIP CODE: SOUTHBANK BSE Ltd. Corporate Relationship Department, First Flo
Slide 2: Investor Presentation - June 2020
Bank On Us Investor Presentation - June 2020
Slide 3: Contents
Contents Q4 & FY20 Highlights Business Strategy Performance Matrix Next Generation Bank About Us 2
Slide 4: Q4 FY20 Highlights
Z Q4 FY20 Highlights © \
Slide 5: Key Quarterly Highlights – Q4 FY20
Key Quarterly Highlights – Q4 FY20 Rs. Cr. CASA Customer Deposits Advances Mar 2020 20,760 Mar 2020 80,700 Mar 2020 65,524 Mar 2019 19,467 Mar 2019 73,597 Mar 2019 63,636 7% 10% 3% Net Interest Income Other Income PCR Q4 FY20 596 Q4 FY20 394 Q4 FY20 54.2% Q4 FY19 499 Q4 FY19 Q4 FY19 42.5% 236 19% 67
Slide 6: Key Quarterly Highlights – Q4 FY20
Key Quarterly Highlights – Q4 FY20 Rs. Cr. PPOP Provisions (excl. tax) Net Profit Q4 FY20 533 Q4 FY20 724 Q4 FY20 (144) Q4 FY19 328 Q4 FY19 Q4 FY19 71 219 Impact of One-off’s on Net Profit Net Profit Excl. Net Profit Excl. Impact of one-offs on Net Rs. In Profit Crs One – off’s One – off’s Extraordi
Slide 7: Key Highlights – FY20
Key Highlights – FY20 PPOP Provisions (excl. tax) Net Profit FY20 1646 FY20 1496 FY20 105 FY19 1239 FY19 FY19 248 858 33% 74% 58% Net Interest Income Other Income FY20 2318 FY20 1046 FY19 2020 FY19 726 15% 44% 6
Slide 8: Business Strategy
ayy Business Strategy aI:
Slide 9: Our Strategy…
Our Strategy… • Retail Banking Department to focus on retail loan & liability/investment products • Efficient branches & processing centers for faster processing of loans Expand Retail • Outbound Sales team Business • Continuous training of work force • Advanced technology for ease of customers • In
Slide 10: …Performance in Line with Strategy
…Performance in Line with Strategy Strengthen Retail base Improve CASA Rs. 21,173 Cr Rs. 20,760 Cr INCREASE INCREASE 7% YoY 15% YoY Expand Agriculture & Reduction of MSME base Corporate Exposure Rs. 25,692 Cr Rs. 18,659 Cr INCREASE DECREASE 8% YoY 15% YoY 9
Slide 11: Shall continue to focus on
Shall continue to focus on 01 Increase … 02 Retail Business … 03 SME Business … CASA More Products Sole Banker Retail MSME Relationships Relationships 06 Sustainable… 05 Increase… 04 Improve Asset Quality Fee Income NIM 10
Slide 12: Increase Retail & MSME Business
...Increase Retail & MSME Business 01 02 03 Centralized Retail Hub Marketing & • Home Loan Processing • Auto Loan • MSME Loan Centre (Kochi) • Mortgage Loan Processing Retail Business • Entire Loan underwriting • Penetrate further in the existing centralised set of Customers • Enhanced risk manageme
Slide 13: …by focus on Housing Loans in Retail
…by focus on Housing Loans in Retail Retail Breakup Housing: Key Initiatives Rs. Cr. • Retail centre in Kochi to increase 21,173 focus on retail loans 19,284 19,834 19,070 18,458 • Dedicated Officers for marketing 5,352 5,249 Retail Loans 4,864 5,075 4,633 • Tailor made products for different 2,757
Slide 14: …becoming a Banker of Choice to SMEs
…becoming a Banker of Choice to SMEs Average MSME Loan / Account MSME Loan Book by Geography Rs. Lakhs 53.8 53.8 54.2 54.9 Rest of 49.9 India 22% Kerala 46% South (Ex- Kerala) 32% Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 SME Highlights • Dedicated executive to ensure focus and better coordination with reg
Slide 15: …with the help of our Wide Network
…with the help of our Wide Network Customer Touch Points +2% 876 900 909 923 929 847 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Total ATM Network 3% 1,382 1,406 1,424 1,287 1,320 1,200 Locations* No. Kerala 508 South India (Ex-Kerala) 272 Rest of India 149 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 To
Slide 16: … and our Experienced Employees
… and our Experienced Employees Employee Addition Total Employees: 7,998* 304 7,998 7,822 80 57 105 6% 11% 28% 13% 42% < 1 Year 1-2 Years 2-5 Years Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Closing 5-10 Years > 10 Years *Full-time officers and clerks 15
Slide 17: Performance Matrix
ayy Performance Matrix 16
Slide 18: Strong Deposit Franchise
Strong Deposit Franchise Deposits (excl. CDs) Rs. Cr. Mar 2020 Mar 2020 Mar 2020 69,827 10,874 80,700 8% 19% 10% 64,478 9,119 73,597 Mar 2019 Mar 2019 Mar 2019 Retail Deposit Bulk Deposit Total Deposits CASA Deposits Mar 2020 Mar 2020 Mar 2020 Rs. Cr. 3,208 17,552 20,760 4% 9% 7% 3,332 16,135 19,467
Slide 19: Deposits across Regions
Deposits across Regions Mar 2019 Mar 2020 5.5% 7.3% 1.4% 1.4% 2.2% 0.8% 1.9% 4.9% 4.8% 1.8% 6.8% 6.7% 52.4% 8.9% 9.1% 58.0% 10.2% 16.0% Kerala Andhra Pradesh Kerala Andhra Pradesh Maharashtra Telangana Maharashtra Telangana Tamil Nadu West Bengal Tamil Nadu West Bengal Karnataka Others Karnataka Oth
Slide 20: Retail Deposits Growing...
Retail Deposits Growing... Breakup of Deposits 82,946 84,874 Rs. Cr. 80,420 81,723 83,034 Term 45,011 46,372 48,279 49,281 49,066 Savings Current Bulk 16,135 16,269 17,075 17,518 17,552 CD 3,332 3,449 3,539 3,904 3,208 9,119 10,454 10,536 9,748 10,874 6,823 5,179 3,517 4,423 2,334 Mar-19 Jun-19 Sep-
Slide 21: Break Up of Non-Resident Deposits
Break Up of Non-Resident Deposits NRI Deposits Mar Jun Sep Dec Mar Deposit Type Rs. Cr. 2019 2019 2019 2019 2020 23,710 23,105 NR SB 4,397 4,449 4,576 4,754 5,068 22,640 21,436 21,877 NR CD 23 23 25 27 26 FCNR (B), RFC & 1,837 1,886 1,925 1,942 1,907 Others Low-Cost NRI Deposit 6,257 6,358 6,526 6,7
Slide 22: Composition of Loan Book
Composition of Loan Book Corporate Advances (Rs. 25 Cr and above ) Advances (Excl. Corporate) (Below Rs. 25 Cr) Rs. Cr. Rs. Cr. +11% -13% 21,436 20,595 45,621 46,865 19,697 19,713 42,200 43,057 44,223 18,659 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Segment wise Break Up
Slide 23: Large Corporate Loan Book
Large Corporate Loan Book Standard Large Corporate Advances (Rs.100 Cr and above ) -41% 11,044 10,592 10,121 10,146 9,997 9,437 6,516 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 22
Slide 24: Advances growing Across Regions
Advances growing Across Regions Mar 2019 Mar 2020 1.1% 1.3% 3.1% 3.0% 3.3% 3.6% 2.8% 4.6% 3.0% 4.7% 5.7% 6.3% 40.7% 43.1% 6.4% 4.9% 13.4% 11.4% 18.8% 18.9% Kerala Telengana Kerala Telangana Tamil Nadu West Bengal Tamil Nadu West Bengal Maharashtra Gujarat Maharashtra Gujarat NCT of Delhi Andhra Prad
Slide 25: Composition of Loan Book
Composition of Loan Book Break up of Loan book Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Advances (Rs. Cr) Number Value Number Value Number Value Number Value Number Value Less than 5 Cr 358,679 30,480 364,352 30,967 370,095 31,725 369,517 32,821 374,069 33,462 5 - 25 Cr 1,155 10,431 1,166 10,789 1,183 11,
Slide 26: Rating Profile of Large Corporate Loan Book
Rating Profile of Large Corporate Loan Book Standard Advances above Rs. 100 Cr. External Rating 18.1% 19.1% 20.0% 19 % 22.8% 36.0% 35.7% 35% 39.3% 37.7% 14.8% 16 % 15.0% 15.8% 16.8% 21 % 14.4% 19.5% 23.9% 26.5% 8.4% 8.2% 10% 5.2% 3.0% Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 AAA AA A BBB <BBB 25
Slide 27: Key Focus: Retail, MSME & Agriculture
Key Focus: Retail, MSME & Agriculture Retail (Incl. Gold) Rs. Cr. 21,173 Retail Loans and 18,458 19,070 19,284 19,834 Agriculture rose by 15% and 14% resp., while MSME grew by 5% Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Agriculture (Incl. Agri Gold) MSME (Incl. MSME Gold) Rs. Cr. Rs. Cr. 9,746 9,873 Over
Slide 28: Advances growing Across Regions
Advances growing Across Regions Rs. Cr. 65,334 65,524 63,652 63,920 63,636 17,293 16,977 18,574 18,353 17,579 20,683 20,715 19,325 19,570 19,898 25,737 25,729 26,443 27,358 27,832 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Rest of India South Ex- Kerala Kerala 27
Slide 29: Net Interest Income - Quarter
Net Interest Income - Quarter Net Interest Income Cost of Deposits & Yield on Advances Rs. Cr. In % Cost Of Deposit Yield on Advances 584 602 596 9.78 9.82 536 9.51 9.69 9.59 499 6.30 6.32 6.24 6.14 6.00 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Net Interest Margin C
Slide 30: Net Interest Income - Cumulative
Net Interest Income - Cumulative Net Interest Income Cost of Deposits & Yield on Advances Rs. Cr. In % 2,317 Cost of Deposits Yield on Advances 2,020 1,722 9.73 9.76 9.74 9.54 9.69 1,120 6.15 6.32 6.28 6.23 6.19 536 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Mar -19 Jun -19 Sep -19 Dec -19 Mar -20 Net Inter
Slide 31: Improving Operating Efficiency
Improving Operating Efficiency Employee Additions Cost-to-Income Ratio In % 57 304 55.4 55.7 53.4 -105 -80 50.6 51.1 -33 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Business per Employee Business per Branch Rs. Cr. Rs. Cr. 17.6 17.9 17.9 17.3 164 165 166 15.9 163
Slide 32: Non Interest Income
Non Interest Income Core Fee Income Treasury & Forex Income Rs. Cr. Rs. Cr. 49 79 63 57 34 33 36 42 33 29 226 75 65 57 57 57 65 83 49 32 14 13 10 11 12 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Transaction Fees Technology Other Profit on Sale of Investments Forex Investme
Slide 33: Break Up of Provisions
Break Up of Provisions Particulars (Rs. Cr.) Q4 FY20 Q3 FY20 Q4 FY19 For NPA & NPI 360 203 191 For Depreciation on Investments 263 23 40 For Standard Assets 89 16 14 For Restructured Advances/Sacrifices & FITL 15 8 3 For Unhedged Forex Exposure - - 1 Others (3) 12 (30) Taxes (47) 32 38 Total Provisi
Slide 34: Non-Performing Assets
Non-Performing Assets Gross NPA Net NPA 4.96 4.96 4.98 4.92 4.92 3.48 3.34 3.45 3.44 3.41 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Gross NPA Movement Net NPA Movement Rs. Cr. Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Rs. Cr. Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Opening 2,930 3,13
Slide 35: Stressed Assets - QoQ
Stressed Assets - QoQ Gross Basis Net Basis Rs. Cr. Q3 FY20 Q4 FY20 Q3 FY20 Q4 FY20 NPA 3,244 3,262 2,212 2,151 Restructured Standard Advance 742 848 703 803 Other Stressed Advances - - - - Total Stressed Assets 3,986 4,109 2,915 2953 Advances 65,335 65,524 64,329 64,439 Stressed Assets 6.1% 6.3% 4.
Slide 36: Restructured Advances Breakup
Restructured Advances Breakup Restructured Standard Advance Rs. Cr. 848 742 516 292 214 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Rs. Cr. Sector Breakup Security Receipts Outstanding as on Mar 31, 2020 Book Value Provision NAV 23.0% 1313.36* 548.77 764.59 *of which Rs.993 Crore pertains to a single pool an
Slide 37: Restructured Standard Asset Book
Restructured Standard Asset Book Rs. Cr. Restructured Standard Advances Inc/(Dec) in Upgradation Fresh Slippages to Closing Opening Existing from NPA to Addition NPA Balance Balance Std. Infra Roads - - - - - - Construction - - - - - - EPC Under MSME 552 135 9 - 46 650 Restructuring Under Kerala 190
Slide 38: Fresh Slippages / Advance Ratios
Fresh Slippages / Advance Ratios Retail Slippage Agriculture Slippage 1.15% 0.39% 0.41% 0.30% 0.20% 0.19% 0.17% 0.11% 0.08% 0.10% Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 MSME Slippage Corporate Slippage 0.75% 0.88% 0.78% 1.36% 1.26% 0.63% 0.53% 0.59% 0.26% 0.1
Slide 39: Capital Composition
Capital Composition BASEL III In % 13.4 12.6 12.2 12.1 12.0 2.6 2.6 2.5 2.5 2.4 10.8 10.0 9.7 9.6 9.6 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Tier 2 Tier 1 38
Slide 40: Profit & Loss Overview (Qtrly)
Profit & Loss Overview (Qtrly) Rs. Cr. Q4 FY20 Q4 FY19 Y-o-Y (%) Q3 FY20 Q-o-Q (%) Net Interest Income 596 499 19% 602 (1%) Other Income 394 236 67% 220 79% - Core Fee Income 156 157 (1%) 178 (12%) -Treasury & Forex 238 78 204% 42 (468%) Total Income 990 735 35% 822 20% Operating Expenses 457 407 12
Slide 41: Profit & Loss Overview (Yearly)
Profit & Loss Overview (Yearly) Rs. Cr. 2019-20 2018-19 % Net Interest Income 2,318 2,020 15% Other Income 1,046 726 44% - Core Fee Income 611 563 9% -Treasury & Forex 435 163 166% Total Income 3,363 2,746 22% Operating Expenses 1,718 1,507 14% Operating Profit 1,646 1,239 33% Provisions & Contingen
Slide 42: Balance Sheet Overview
Balance Sheet Overview Rs. Cr. Mar 2020 Mar 2019 Y-o-Y (%) Dec 2019 Q-o-Q (%) Capital & Liabilities 97,032 92,279 5% 96,530 1% Capital 181 181 0% 181 0% Reserves and Surplus 5294 5154 3% 5,468 -3% Deposits 83034 80420 3% 84,874 -2% Borrowings 6893 4903 41% 4,311 60% Other Liabilities & Provisions 16
Slide 43: Key Metrics - Quarterly
Key Metrics - Quarterly FY18 FY19 FY20 Particulars Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Net Interest Margin (NIM) 2.80% 2.95% 2.88% 2.73% 2.60% 2.61% 2.66% 2.46% 2.53% 2.69% 2.72% 2.67% CRAR Basel III 12.1% 11.7% 12.5% 12.7% 12.2% 12.1% 11.8% 12.6% 12.2% 12.1% 12.0% 13.4 RoAA (Annualized) 0.6% 0.02%
Slide 44: Key Metrics - Yearly
Key Metrics - Yearly Particulars 2017-18 2018-19 2019-20 Net Interest Margin (NIM) 2.84% 2.58% 2.66% CRAR Basel III 12.70% 12.61% 13.41% RoAA (Annualized) 0.43% 0.29% 0.11% Provision Coverage 41.15% 42.46% 54.22% CASA 23.80% 24.21% 25.00% Gross NPA 3.59% 4.92% 4.98% Net NPA 2.60% 3.45% 3.34% Book Va
Slide 45: COVID 19: Operational Impact
COVID 19: Operational Impact Quick Response Team is taking proactive steps to ensure business continuity. This is being reviewed periodically. Appropriate measures are taken as part of Business Continuity Plan, in order to ensure that no interruptions occur in any of the business activities. E
Slide 46: COVID 19: Moratorium
COVID 19: Moratorium Assessment of Loan Portfolio under Covid impact Rs. Cr. Current balance As a of SMA 0/1/2 as Of C, where Total Moratorium percentage on Feb 29, 2020 standstill % of C to % of C Sector Portfolio extended to total under benefit taken B to A (A) (B) portfolio moratorium as on 31.03
Slide 47: Next Generation Bank
ayy Next Generation Bank © 46
Slide 48: Present across Customer Touch Points
Present across Customer Touch Points Traditional & Alternate Channels SIB Mirror + Mobile Banking ATMs Branches 1,424 ATMs across India 875 Branches & 54 Extension Counters Internet Banking Point of Sale 47
Slide 49: Technology Initiatives
Technology Initiatives Mirror + is an all in one stop for your mobile banking needs, with additional features as IMPS (24/7) fund transfer, NEFT fund transfers, and full access to account information, and much more SIBerNet is a suite of comprehensive internet banking services positioning SIB as a t
Slide 50: Digital Initiatives
Digital Initiatives Channel Enhancements Digital Onboarding of new to bank customers, has Paperless instant account opening using augmented our customer base. Further, our Mobile & Aadhar and PAN. No forms to fill. No Internet Banking channels have been enhanced to facilitate queue. branch processes
Slide 51: Personal Banking: Technology Banking
Personal Banking: Technology Banking Active Internet Users Internet Transaction Volume Internet Transaction Value (000)’s (000)’s Rs. Cr. 1,125 1,178 1,181 9,638 10,102 1,027 1,060 8,783 7,961 8,330 472.00 390.00 403.00 425.00 451.00 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Mar-19 Jun-19 Sep-19 Dec-19 Mar
Slide 52: Personal Banking: Debit Cards
Personal Banking: Debit Cards No. of Active Debit Cards Debit Card Transaction Volumes In Millions In Millions 3.8 27.5 26.5 28.1 29.5 27.8 2.7 2.8 2.9 3.0 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Debit Card Transaction Value Rs. Cr. 8,292 7,948 7,508 7,766 7,321 Mar-19
Slide 53: Increasing Third-Party Tie Ups
Increasing Third-Party Tie Ups • Kotak Mahindra Life Insurance • Max Bupa Health Insurance • SBI Life Insurance • Manipal Cigna Health Insurance • LIC of India • Reliance Asset Management • TATA Asset Management • HDFC Mutual Fund • DSP Blackrock Mutual Funds • Aditya Birla Sun Life Asset Management
Slide 54: About Us
@ About Us 53
Slide 55: Leadership Team
Leadership Team Mr. V. G. Mathew, MD & CEO Post Graduate in Physics and CAIIB with over 40 years of experience Joined SIB in January, 2014 as Executive Vice President and appointed as MD & CEO in October 2014 Significant experience in Retail & Corporate Credit, Technology and Risk Management
Slide 56: Leadership Team
Leadership Team Mr. Thomas Joseph K, EVP (Operations) • Bachelors Degree in Engineering and Diploma in Management & CAIIB • He is associated with SIB since 1984 and heads Departments such as Risk Management, Technology, Marketing, Corporate Financial Management, Human Resource and Inspection & Vigil
Slide 57: Management Team
Management Team Mr. Benoy Varghese (Country Head - Wholesale Banking) • Bachelors Degree in Arts & Masters Degree in Business Administration and CAIIB Mr. Raphael T.J., Chief General Manager (Chief Information Officer) • Bachelors Degree in Commerce, Masters in EXIM, Diploma in Financial Management
Slide 58: Management Team
Management Team Mr. Sanchay Kumar Sinha (Country Head - Retail Banking) • Bachelor’s degree in Arts, Post Graduate Certificate in Business Management (XLRI) Mrs. Chithra H, Chief Financial Officer • Bachelors Degree in Commerce • Fellow member of the Institute of Chartered Accountants of India • Cer
Slide 59: Safe Harbour
Safe Harbour 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. Cert
Slide 60: For further information, please contact:
For further information, please contact: Company Investor Relations Advisors The South Indian Bank Ltd. Strategic Growth Advisors Pvt. Ltd. CIN - L65191KL1929PLC001017 CIN - U74140MH2010PTC204285 Ms. Chithra H, CFO Mr. Shogun Jain / Mr. Sagar Shroff chithra@sib.co.in shogun.jain@sgapl.net / sagar.sh
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