Karnataka Bank Ltd. · NSE:KTKBANK
Karnataka Bank — The Karnataka Bank — Q3 FY25 Earnings Presentation
43 slides from Karnataka Bank's earnings presentation, Jan 31, 2025
Slide 1: Exchange filing cover letter
Karnataka Bank Ltd. Your Family Bank, Across India Regd. & Head Office Phone : 0824-2228184 P. B. No.599, Mahaveera Circle E-Mail : Comsec@ktkbank.com Kankanady Website : www.karnatakabank.com Mangaluru – 575 002 CIN : L85110KA1924PLC001128 SECRETARIAL DEPARTMENT 31.01.2025 HO:SEC:268:2024-25 To: 1.
Slide 2: Investor Presentation Q3 FY25
INVESTOR PRESENTATION Q3 FY25 Banking with Legacy, 100 Years of Trust & Excellence Embracing the Future
Slide 3: Table of Contents
Table of Contents Independent Board and 01 Experienced Management Team 02 Financial Highlights Accelerating our Transformation 03 Journey 04 Our Strengths and Strategies
Slide 4: Key Achievements During Q3 FY25
Key Achievements During Q3 FY25 Beginning of transformative steps leading to stable financial position… Deposits and Advances Growth Stakeholder Value Asset Quality Gross Advances1 NII Excl Impact of Penal Charges Reclassification - 3.64% Rs. 817 Crore (Q3 FY25) 3.11% Growth: INR cr. 11.6% 2,113 3.4
Slide 5: Q3 FY25 Performance at a Glance
Q3 FY25 Performance at a Glance Q3FY25 9MFY25 Assets • Continued improvement in Gross Advances Retail Advances Deposits CASA book quality due to improved focus on collection and 77,860 38,182 1,00,119 30,352 recovery mechanisms 11.6% YoY 15.3% YoY 8.6% YoY 4.7% YoY • Retail advances grew by 4% QoQ.
Slide 6: Q3 and 9M FY25 Performance at a Glance
Q3 and 9M FY25 Performance at a Glance Profitability Gross Interest Income for Q3 FY25 has grown 6.17% YoY while Interest Expense grew 12.86% over the same period owing to increase in deposit rates, Consequently, NII for Q3 FY25 decreased 4.21% YoY. NII for 9M FY25 grew 2.64% YoY. As a result
Slide 7: Experienced Management Team
Experienced Management Team… Strengthening of Management, making the Organization Future Ready Srikrishnan H Sekhar Rao Abhishek Sankar Bagchi MD & CEO Executive Director Chief Financial Officer Former MD & CEO, Jio Payments Former COO, CSB Bank; National Former CFO, NSDL Payments Bank; Bank; ED, Ye
Slide 8: Guided by an Independent Board
…Guided by an Independent Board With no Shareholder Holding >5% Share Capital in the Bank P Pradeep Kumar Justice A V Chandrashekar Kalmanje Gururaj Acharya Part Time Chairman, Independent Independent Director Independent Director Director Former Judge, High Court of Senior Partner, M/s. K G Acharya
Slide 9: Financial Highlights
Financial Highlights Banking with Legacy, Celebrating 100 years of trust Embracing the Future
Slide 10: Karnataka Bank at a Glance (Q3)
Financial Highlights Karnataka Bank at a Glance Particulars Q3FY25 Q3FY24 Growth Y-o-Y Q2FY25 Growth Q-o-Q Total Business 1,77,978 1,61,936 9.91% 175,284 1.5% Gross Advances / % Retail 77,860 / 49.04% 69,741 / 47.50% 11.64% / 154bps 75,316 / 48.74% 3.38% / 30bps Deposits 1,00,119 92,195 8.59% 99,968
Slide 11: Karnataka Bank at a Glance (Q3, continued)
Financial Highlights Karnataka Bank at a Glance Particulars Q3FY25 Q3FY24 Growth Y-o-Y Q2FY25 Growth Q-o-Q Fee Income or Commission Income 250 205 21.95% 223 12.11% Non-interest Income / Total Income 292 / 2,535 326 / 2,439 (10.34%) / 3.96% 270 / 2,504 8.31% / 1.25% Credit Cost 0.12% 0.25% (13bps) 0
Slide 12: Karnataka Bank at a Glance (9M)
Financial Highlights Karnataka Bank at a Glance Particulars 9MFY25 9MFY24 Growth Y-o-Y FY24 Total Business 1,77,978 1,61,936 9.91% 171,059 Gross Advances / % Retail 77,860 / 49.04% 69,741 / 47.50% 11.64% / 30bps 73,002 / 46.60% Deposits 1,00,119 92,195 8.59% 98,058 Retail Term Deposits 69,743 63,176
Slide 13: Karnataka Bank at a Glance (9M, continued)
Financial Highlights Karnataka Bank at a Glance Particulars 9MFY25 9MFY24 Growth Y-o-Y FY24 Fee Income or Commission Income 701 634 10.57% 928 Non-interest Income / Total Income 841 / 7,596 900 / 6,997 (6.47%) / 8.56% 1319 / 9,617 Credit Cost 0.32% 0.67% (35bps) 0.84% Slippage Ratio 1.35% 1.90% (55b
Slide 14: Balance Sheet
Financial Highlights Balance Sheet Particulars 9MFY25 9MFY24 Growth Y-o-Y FY24 Property & Assets Cash & Balance With RBI 4,761.86 5,220.79 (8.79%) 7,656.07 Balance With Banks & Money At Call & 1,012.55 140.56 620.37% 336.67 Short Notice Investments 22,830.89 24,432.70 (6.56%) 24,302.05 Advances 76,4
Slide 15: Profitability
Profitability Operating Revenue (INR Cr.) Other Income (INR Cr.) 4,618 4,178 419 3,445 326 94 32 279 292 270 81 25 47 32 21 43 6 18 1,154 1,253 1,182 293 1,103 1,085 226 220 246 202 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 FY22 FY23 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Fee / Commission Income
Slide 16: Profitability
Profitability Net Interest Margin 1 Non-Interest Income to Total Income 3.70% 3.52% 13.29% 13.71% 12.09% 3.20% 3.26% 11.07% FY22 FY23 FY24 9MFY25 FY22 FY23 FY24 9MFY25 Return on Equity Return on Assets 15.42% 1.21% 1.19% 1.14% 13.71% 11.94% 7.40% 0.56% FY22 FY23 FY24 9MFY25 FY22 FY23 FY24 9MFY25 15
Slide 17: Liability Profile
Liability Profile Deposit Profile (INR Cr.) 98,058 98,058 100,164 99,968 100,119 92,195 87,368 80,387 25,167 25,167 24,918 24,993 24,674 23,910 23,491 5,671 5,819 5,678 21,673 6,181 6,181 5,084 5,316 4,827 66,710 63,201 66,710 69,575 69,156 69,767 53,887 58,561 FY22 FY23 FY24 Q3 FY24 Q4 FY24 Q1 FY25
Slide 18: Advances
Advances Gross Advances Profile 1 (INR Cr.) Sectoral Loan Exposure 2 13.8% 2.0% 7.6% Mid Corporates2 Other Retail Agriculture 9.8% 2.9% Gold 77,860 Mortagage 75,455 75,316 2.7% 73,002 73,002 69,741 14.0% Vehicle NBFC 28% 61,303 29% 27% 11.4% 18.8% 28% 28% 57,769 27% Large Corporates MSME 2.6% 14.4%
Slide 19: Asset Quality
Asset Quality GNPA & NNPA Provision Coverage (Incl. & excl. TWO) 3.90% 80.86% 79.22% 3.74% 73.47% 80.75% 79.22% 80.14% 80.64% 3.53% 77.97% 3.64% 3.53% 3.54% 55.50% 56.21% 58.21% 2.42% 3.21% 56.21% 53.97% 55.15% 56.03% 3.11% 38.80% 1.70% 1.58% 1.55% 1.58% 1.66% 1.46% 1.39% FY22 FY23 FY24 Q3 FY24 Q4 F
Slide 20: Asset Quality: Restructured Portfolio
Asset Quality Restructured Portfolio GNPA & Restructured Assets (INR Cr.) Standard Restructured Portfolio (incl Related Accounts) 11.0% 7.9% 5.7% 6.3% 5.7% 5.4% 4.9% 4.5% 2.4% 16.8% 6,366 21.3% Others Personal MSME Loans 2,251 4,864 1.8% 4,157 4,374 4,157 3.6% 4,063 Agriculture 3,683 3,533 LRD 2,293
Slide 21: Asset Quality: Movement of NPA
Asset Quality Movement of NPA Quarterly Annual Particular (INR Cr.) Q3 FY25 Q2 FY25 Q1 FY25 FY24 Opening Gross NPA 2,414.92 2,668.45 2,578.42 2,292.91 Additions 292.69 242.67 416.49 1,650.20 Sub Total ( A ) 2,707.61 2,911.12 2,994.91 3,943.11 Slippage ratio 0.40 0.33 0.59 2.80 Reduction Up-gradation
Slide 22: Asset Quality: Sector-wise Breakup Analysis
Asset Quality Sector-wise Breakup Analysis Gross Advances Breakup (INR Cr.) Non-Performing Assets Breakup (INR Cr.) Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 MSME 15,425 14,774 14,832 14,677 14,569 MSME 1,194 1,163 1,011 923 955 Agriculture 9,235 10,029 10,901 1
Slide 23: Efficiency Ratio
Efficiency Ratio Cost to Income Ratio* 56.9% 52.6% 53.2% 47.1% FY22 FY23 FY24 9MFY25 Business per Employee (INR Cr.) Staff Cost (INR Cr.) 20.3 1,373 19.8 19.8 19.0 19.2 1,069 18.6 1,015 17.0 437 336 320 350 343 16.0 FY22 FY23 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 FY22 FY23 FY24 Q3 FY24 Q4 FY2
Slide 24: Key Ratios
Key Ratios Capital Adequacy Ratio Risk Weighted Assets (INR Cr.) 56.6% 53.9% 53.9% 55.8% 53.9% 54.9% 54.8% 54.0% 17.5% 18.0% 18.0% 17.6% 17.6% 17.6% 62,533 61,351 62,533 63,554 63,634 63,228 15.7% 1.8% 15.9% 1.8% 1.7% 1.7% 1.6% 53,378 3.3% 51,855 3.0% 2.2% 16.2% 16.2% 15.9% 15.9% 16.0% 12.7% 14.2% 1
Slide 25: Shareholder Value
Shareholder Value Shareholding Pattern EPS & Market Capitalisation 45.0 10,000 39.8 40.0 37.9 * 35.8 35.0 Others, Foreign 0.4% Institutions, 8,000 7,897 11.2% 30.0 7,198 Domestic 6,000 25.0 Institutions, 20.2% 20.0 Indian Body 4,000 Public, Corporate, 15.5 4,238 15.0 13.9 60.5% 5.3% 1,899 NRIs, 2.4%
Slide 26: Accelerating our Transformation Journey
Accelerating our Transformation Journey Banking with Legacy, Celebrating 100 years of trust Embracing the Future
Slide 27: Targeted Performance Improvement to Boost Returns
Targeted Performance Improvement to Boost Returns Cost to Income %: 52.0% - 56.0% Manage Operating Expenses NNPA: 1.0% - 1.3% Enhance Asset Quality ROA %: CASA %: 1.1% - 1.2% 30.0% - 32.0% Effective Capital Allocation Stable Source of Funding NIM %: 3.2% - 3.4% Consistent Interest Margins Cost of Fu
Slide 28: Products
Products Building a Comprehensive Portfolio of Products Customer-centric approach for creating products Leverage Cross-sell & Up-sell opportunities Comprehensive product suite Pipeline of products for continuous growth Retail Agriculture MSME Retail loans Liability Products ADC Channels Agri Schemes
Slide 29: Digital and Technology: Digital Touchpoints
Digital and Technology Digital Touchpoints 3,701,879 772,900 5,490,143 Mobile App Installations Net Banking Users Debit Cards 3.1% QoQ 1.3% QoQ 1.3% QoQ 110,467 1,506 QR related metrics ATM Networks 9.4% QoQ 0.1% QoQ 28
Slide 30: Digital and Technology: Awards
Digital and Technology Awards Outstanding work in Best Innovation & Account Aggregator Leveraging Data for Partnership Ecosystem Awards 2024 Growth Initiatives for Financial Inclusion ET BFSI Excellor Award 2024 Assocham 19th Annual Summit & Awards SAMVAAD 2024 (by Sahamati) 29
Slide 31: Moving towards a Digital-First Bank
Digital and Technology Moving towards a Digital-First Bank Creating a disruptive ”Bank within a Bank” Our Objectives Infrastructure to Meet Our Objectives First-in-class digital factory Increase in Customer Base Products and Business Solutioning have been integrated into the Technology and Digital H
Slide 32: Scalable and Reliable Architecture
Digital and Technology Scalable and Reliable Architecture Embedding data & analytics in business processes for data-driven decision making Foundation of Architecture Integration with the Business Impact on the Business First-in-class scalable central data Retail Loan Propensity repository on cloud w
Slide 33: Best in class Analytics Factory
Digital and Technology Best in class Analytics Factory: 360day PitStop Business Dashboards Driving Agility and Precision in Decisions Business Systems ensuring New Insights have Rails for Outcomes Live - Customer Live - Early Warning Signals Relationship Management (EWS) & Collection (CRM) & Custome
Slide 34: Our Strengths and Strategies
Our Strengths and Strategies Banking with Legacy, Celebrating 100 years of trust Embracing the Future
Slide 35: Strategic Roadmap
Strategic Roadmap Creating a Strengthening Financial A Performance-Driven C Position to Create Culture Long-Term Value Delivering Excellence in Digitalisation and Core Businesses with Partnership to Underlying Technology Rebuild Outward-Facing, Accelerate Book Growth Transformative steps Platform le
Slide 36: Driving Excellence in Proven Core Competencies
Driving Excellence in Proven Core Competencies A. Consistent Emphasis on our Strength Areas Our Legacy Building on Our Legacy ▪ Tradition with Innovation 13.6 Mn ▪ Outbound Sales Culture Happy customers ▪ Startup-like Agility 100 Year Legacy 34.6% 46.4% ▪ Capitalise on community network ▪ MSME and R
Slide 37: Diversified Offerings with Established Brand Equity
Driving Excellence in Proven Core Competencies A. Diversified Offerings with Established Brand Equity Retail and Personal Banking Agriculture Banking MSME ▪ Housing ▪ Agriculture & allied activities ▪ Working capital finance for traders & ▪ Vehicle ▪ Farm development manufacturing industries ▪ Gold
Slide 38: Key Capabilities in Government Business
Driving Excellence in Proven Core Competencies A. Key Capabilities in Place to Leverage Opportunities in the Government Business Focused to be one of the top govt. collection Banks Empaneled as 'Agency Bank’ for direct tax collection Integrated on National Jan Samarth portal State-level Treasury int
Slide 39: Strong Geographical Footprint
Driving Excellence in Proven Core Competencies A. Strong Geographical Footprint Steady Growth in Locations Served 7 4 2 9 22 1 10 12 2 937 1,506 1 Branches ATM and Recyclers 3 17 7 20 5 Presence Across All Tiers 9 58 Top 5 States Rural 27 Karnataka 593 23.4% Metro 27.9% Maharashtra 58 7 45 593 Total
Slide 40: Rebuild Outward-Facing, Business-Centric Teams
Creating a Performance Driven Culture B. Rebuild Outward-Facing, Business-Centric Teams Outbound sales team and “Feet on the Street” for growing Inducted 278 Sales Officers and 228 Feet on Ground for liabilities and expanding the home loan book covering key markets and target segments Better control
Slide 41: Foundation in place to Drive Next Leg of Digital Innovation
Digitalisation Propelling Robust Book Growth C. Foundation in place to Drive Next Leg of Digital Innovation ▪ Live with CRM: Integration of customer data and interactions across Marketing and Sales department State-of-the-art ‘Technology, Digital & ▪ Enhance customer engagement and improve Launched
Slide 42: Initiatives towards Digitisation
Digitalisation Propelling Robust Book Growth C. Initiatives towards Digitisation Executed initiatives Planned future initiatives for 2025 Colending partnership Pre-approved and National Back Office Hyperlocal SEO Flow-Based Loans Transformation expansion - UGro Dairy Maintenance Personal Loans Loans
Slide 43: Disclaimer
Disclaimer This presentation has been prepared by Karnataka Bank (the “Bank”) solely for providing information about the Bank. This presentation is confidential and may not be copied or disseminated, in whole or part, in any manner. This presentation has been prepared by the Bank based on informatio