South Indian Bank Limited · NSE:SOUTHBANK
South Indian Bank — Q1 FY18 Earnings Presentation
56 slides from South Indian Bank's earnings presentation, July 2017
Slide 1: Investor Presentation July 2017
Experience Next Generation Banking Investor Presentation July - 2017
Slide 2: Safe Harbor
Safe Harbor 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. Certa
Slide 3: Contents
Contents Q1 FY18 Highlights Business Strategy Performance Matrix Next Generation Bank An Inflection Point About Us 3
Slide 4: Q1 FY18 Highlights
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Slide 5: Key Performance Highlights - Q1 FY18
Key Performance Highlights- Q1 FY18 Rs Crs CASA Deposits Advances Q1 FY18 16,586 Q1 FY18 65,791 Q1 FY18 47,264 Q1 FY17 13,454 Q1 FY17 57,889 Q1 FY17 42,024 23% 14% 12% Net Interest Income Other Income Q1 FY18 461 Q1 FY18 219 Q1 FY17 374 Q1 FY17 173 23% 26% PPOP PAT Q1 FY18 379 Q1 FY18 101 Q1 FY17 Q1
Slide 6: Recent Updates
Recent Updates • South Indian Bank has tied up with PFG Forex for remittance facility for the benefit of Indian expatriates from Australia • Under this arrangement, NRIs can enjoy cost-effective and fast remittance services using SIB's Express facility • NRIs can visit the PFG Forex outlets across A
Slide 7: Business Strategy
ayy Business Strategy aI:
Slide 8: Our Strategy
Our Strategy… • Focus on retail loan products Expand • Efficient branches for faster processing of loans Retail • Continuous training of work force Business • Advanced technology for ease of customers • Invest in Brand Building • Cluster based approach in industry hubs Strengthen SME Base • Sole Ban
Slide 9: Performance in Line with Strategy
…Performance in Line with Strategy Expand Retail, SME & Strengthen SME Base Improve CASA Agriculture Business Rs. 28,367 Crs Rs. 10,851 Crs Rs. 16,586 Crs INCREASE INCREASE INCREASE 15% YoY 10% YoY 23% YoY Enhance Asset Quality Improve share of other (Restructured Book) Income Rs. 501 Crs Rs. 219 Cr
Slide 10: Shall continue to focus on Core Strengths
Shall continue to focus on Core Strengths 01 Increase … 02 Retail Business … 03 SME Business … CASA More Products Sole Banker Retail SME Relationships Relationships 06 Sustainable… 05 Increase… 04 Improve Asset Quality Fee Income NIM 10
Slide 11: Increase Retail & SME Business
...Increase Retail & SME Business 01 02 03 Centralized Retail Hub Marketing & • Home Loan Cluster Processing • Auto Loan Branches • MSME Loan Centre (Kochi) • LAP Loan Processing Retail Business Branch Profitability • Enhanced risk management • Penetrate further in the • Focus on particular existing
Slide 12: Focus on Housing Loans in Retail
…by focus on Housing Loans in Retail Retail Breakup Housing: Key Initiatives Rs Crs +20% 12,002 • Retail hub in Kochi to increase focus on 11,566 housing finance 1,369 10,358 10,409 1,329 • Two more hubs to be set up – one in 10,002 986 South India and one in North India 1,094 1,154 801 1,063 1,094
Slide 13: Becoming a Banker of Choice to SMEs
…becoming a Banker of Choice to SMEs Average SME Loan / Account SME Loan Book by Geography – Q1 FY18 Rs Lakhs Rest of India 19.69 24% Kerala 43% 17.66 15.76 16.10 15.56 South (Ex- Kerala) 33% SME Highlights • Dedicated JGM appointed to ensure focus and better coordination with regions • Focused ‘Gre
Slide 14: With the Help of our Branch Network
…with the help of our Branch Network Total Branch Network +2.9% 822 834 850 851 738 794 FY13 FY14 FY15 FY16 FY17 Q1 FY18 Total ATM Network +10.9% No of 1,287 1,320 1,344 Branch Location* 1,200 Branches 1,000 Kerala 463 800 South India (Ex-Kerala) 246 Rest of India 142 Total 851 FY13 FY14 FY15 FY16 F
Slide 15: Our Experienced Employees
… and our Experienced Employees Employee Addition Total Employees: 7,256* 7,256 279 6,975 5 6 3 7% 1% 26% 33% 33% Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Closing < 1 Year 1-2 Years 2-5 Years 5-10 Years > 10 Years *Employees include full-time officers and clerks. 15
Slide 16: Performance Matrix
ayy Performance Matrix 16
Slide 17: Strong Deposit Franchise
Strong Deposit Franchise Core & Non-Core Deposits Rs Crs Jun-17 Jun-17 Jun-17 55,712 10,079 65,791 15% 9% 14% 48,634 9,255 57,889 Jun-16 Jun-16 Jun-16 Core Deposit Non-Core Deposit Total Deposit CASA Deposits Jun-17 Jun-17 Jun-17 Rs Crs 3,064 13,522 16,586 40% 20% 23% 2,187 11,267 13,454 Jun-16 Jun-
Slide 18: Core Deposits Growing
Core Deposits Growing... Breakup of Deposits CASA Deposit Rs Crs Rs Crs 66,117 65,791 +23% 63,595 60,192 16,586 57,889 13,454 3,064 2,187 11,267 13,522 38,498 39,162 37,415 36,279 35,230 Jun-16 Jun-17 Current Savings Term Deposits 12,994 Rs Crs 13,540 13,522 +11% 11,267 11,299 2,753 39,162 2,399 2,9
Slide 19: NRI Deposits Growing
NRI Deposits Growing… NRI Deposits CASA Rs Crs In (%) 17,389 16,821 16,317 15,476 25.9 15,025 25.2 23.2 23.8 22.8 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 19
Slide 20: Composition of Loan Book
Composition of Loan Book Corporate Advances (Above Rs 25 Crs) Retail Advances Rs Crs Rs Crs 17,198 17,982 17,901 17,536 29,183 29,728 15,998 26,026 27,230 27,252 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Segment wise Break Up of Total Loan Book Rs Crs 6,876 , 17,536 , 14.
Slide 21: Key Focus: Retail, SME & Agriculture
Key Focus : Retail, SME & Agriculture Retail excluding Gold Gold ( Average LTV – 65%) Rs Crs Rs Crs 10,245 10,641 1,417 1,432 1,361 1,290 1,321 Retail Loans (Excl. 8,585 8,925 9,119 Gold), Agriculture & SME has grown by 15% Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Agricu
Slide 22: Advances Growing Across Regions
Advances growing Across Regions Rs Crs 47,084 47,264 44,428 45,234 42,024 14,170 13,541 13,413 13,632 12,715 14,693 15,034 13,923 14,054 13,315 17,092 17,548 18,221 18,689 15,994 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Rest of India South Ex- Kerala Kerala 22
Slide 23: Net Interest Income - Quarter
Net Interest Income - Quarter Net Interest Income Cost of Deposits & Yield on Advances Rs Crs In % +23% Cost Of Deposit Yeild on Advances 445 439 461 418 374 10.89 10.59 10.32 9.97 10.06 6.98 6.75 6.53 6.33 6.24 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 Net Interest Marg
Slide 24: Net Interest Income - Cumulative
Net Interest Income - Cumulative Net Interest Income Cost of Deposits & Yield on Advances Rs Crs In % +23% Cost of Deposits Yield on Advances 1,675 10.89 10.73 1,236 10.59 10.43 10.06 819 6.98 6.86 6.75 6.64 374 461 6.24 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun -16 Sept -16 Dec -16 Mar -17 Jun -17 Net
Slide 25: Improving Operating Efficiency
Improving Operating Efficiency Employee Additions C/I Ratio In % 279 52.57 51.08 48.53 49.20 3 5 -6 44.19 -32 Jun -16 Sept -16 Dec -16 Mar -17 Jun -17 Jun -16 Sept -16 Dec -16 Mar -17 Jun -17 Business per Employee Business per Branch Rs Crs Rs Crs 13.5 13.8 14.3 129 13.0 13.2 115 117 119 120 Jun-16
Slide 26: Sustainable Other Income
Sustainable Other Income Total Other Income led by …. …Sustainable : Transaction Fees + Technology Rs Crs Rs Crs 259 86 84 79 74 219 67 173 146 138 54 59 54 48 45 25 26 22 27 30 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Transaction Fees Technology Profit on Sale of Invest
Slide 27: Break Up of Provisions
Break Up of Provisions Rs Crs Q1-FY 18 Q1-FY 17 Q4-FY 17 For NPA & NPI 184.4 93.1 231.6 For Depreciation on Investments 26.1 -5.4 23.3 For Standard Assets -6.9 22.2 -21.1 For Restructured Advances/Sacrifices & FITL -0.2 4.1 -34.0 For Unhedged Forex Exposure -0.7 0.3 -2.4 Others 21.7 -0.2 -32.2 Taxes
Slide 28: Non Performing Assets
Non Performing Assets Gross NPA Net NPA 3.96% 3.96% 3.98% 2.89% 2.77% 3.61% 2.52% 2.54% 2.45% 1.45% Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 Gross NPA Movement Net NPA Movement Rs Crs Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 Rs Crs Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 Openin
Slide 29: Stressed Assets - QoQ
Stressed Assets - QoQ Gross Basis Net Basis Rs Crs Q4-FY 17 Q1-FY 18 Q4-FY 17 Q1-FY 18 NPA 1,149 1,696 675 1,183 Restructured Standard Advance 309 240 309 240 Other Stressed Advances 606 0 606 0 Total Stressed Assets 2,064 1,936 1,590 1,423 Advances 46,846 46,992 46,366 46,474 Stressed Assets as % o
Slide 30: Restructured Advances Breakup
Restructured Advances Breakup Restructured Assets Break-up Sector Standard Restructure – Q1FY18 Rs Crs 1,387 1,293 1,295 442 532 16% 653 9% 571 501 945 262 75% 761 261 642 309 240 Infra Roads Construction EPC Others Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Restructured NPA Restructured Standard Advance 30
Slide 31: Restructured Standard Asset Book
Restructured Standard Asset Book Rs Crs Restructured Standard Advance Increase in Fresh Uday – SDL Decrease in Slippages to Closing Opening Existing Addition Investments Balance NPA Balance Balance Infra Roads 176 - 3 - - - 179 Construction 22 - - - - - 22 EPC Others 110 - 2 73 - - 39 Total 309 - 5
Slide 32: Movement in Restructured Accounts
Movement in Restructured Accounts Movement in Restructured Accounts Rs Crs Shift of focus from 0 5 Large Corporate 73 to SMEs 0 2 Defocusing from 571 Power & Infra Sectors 501 Special Recovery Cell & Opening Fresh Increase Upgradation Closure Dec in Closing Asset Monitoring Cell Addition in Balance
Slide 33: Adequate Provisioning
Adequate Provisioning NPA Provisioning Rs Crs 102.6 Provision Coverage 141.4 489.7 451.0 Ratio - 44.64% NPAs in the initial period of recognition require lower provisioning Opening Additions Deductions Closing 33
Slide 34: Fresh Slippages/Advance Ratios
Fresh Slippages/Advance Ratios Retail Slippage Agriculture Slippage 0.86% 0.90% 0.55% 0.61% 0.49% 0.35% 0.38% 0.34% 0.27% 0.11% Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 Jun-16 Sept-16 Dec-16 Mar-17 Jun-17 SME Slippage Corporate Slippage 0.85% 3.51% 0.64% 0.55% 0.51% 2.37% 0.39% 0.65% 0.64% 0.00% Jun-16 S
Slide 35: Well Capitalized to support Growth
Well Capitalized to support Growth BASEL III In % 12.4 12.1 11.7 11.1 11.1 1.5 1.4 1.8 1.7 1.7 10.9 10.8 9.9 9.5 9.4 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Tier 2 Tier 1 35
Slide 36: Balance Sheet Overview - Q1 FY18
Balance Sheet Overview- Q1 FY18 Rs Crs Q1-FY 18 Q1-FY 17 Y-o-Y (%) Q4-FY 17 Q-o-Q (%) Capital & Liabilities 73,195 64,504 13.47% 74,312 -1.50% Capital 180 135 33.56% 180 0.03% Reserves and Surplus 4,822 3,916 23.15% 4,665 3.36% Deposits 65,791 57,889 13.65% 66,117 -0.49% Borrowings 1,147 1,395 -17.7
Slide 37: Profit & Loss Overview - Q1 FY18
Profit & Loss Overview- Q1 FY18 Rs Crs Q1-FY18 Q1-FY 17 Y-o-Y (%) Q4-FY17 Q-o-Q (%) Net Interest Income 461 374 23.30% 439.10 4.92% Other Income 219 173 26.45% 137.71 59.25% Total Income 680 547 24.30% 576.81 17.89% Operating Expenses 301 288 4.49% 296.01 1.52% Operating Profit 379 259 46.25% 280.80
Slide 38: Key Metrics - Quarterly
Key Metrics- Quarterly FY15 FY16 FY17 FY18 Particulars Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Net Interest Margin 2.7% 2.9% 2.5% 2.7% 2.5% 2.8% 2.9% 2.6% 2.7% 2.8% 2.7% 2.7% 2.8% (NIM) CRAR Basel III 12.2% 12.1% 11.4% 12.1% 11.4% 11.9% 11.7% 11.8% 11.7% 11.1% 11.1% 12.4% 12.1% RoAA (Annualized) 0.5%
Slide 39: Next Generation Bank
ayy Next Generation Bank © 39
Slide 40: Present across Customer Touch Points
Present across Customer Touch Points Traditional & Alternate Channels SIB Mirror + Mobile Banking ATMs Branches 1,344 ATMs across India 851 Branches & 51 Extension Counters Internet Banking Point of Sale 40
Slide 41: Technology Initiatives
Technology Initiatives SIB Mirror is a mobile-led platform with instant account access, balance retrieval, immediate fund transfers, all account intimations, and much more SIB-er Net is a suite of comprehensive internet banking services positioning SIB as a technology-driven bank offering superior s
Slide 42: Personal Banking: Technology Banking
Personal Banking: Technology Banking Active Internet Users Internet Transaction Volume Internet Transaction Value (000)’s (000)’s Rs Crs 899 4,489 4,700 785 839 192 205 611 663 3,054 3,293 157 175 2,551 141 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sep-16 Dec-16 Ma
Slide 43: Personal Banking: Debit Cards
Personal Banking: Debit Cards No of Active Debit Cards Debit Card Transaction Volumes In Millions In Millions 3.4 31.4 33.7 33.6 30.8 27.1 3.3 3.3 3.2 3.2 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Debit Card Transaction Value Rs Crs 6,655 5,777 5,929 *Transaction volumes
Slide 44: An Inflection Point
An Inflection Point 4) 44
Slide 45: Moving Towards Vision 2020
Moving Towards Vision 2020… Appointed Entered Opened International Memorandum Centralized Finance of Understanding Marketing & Corporation with Processing NSIC Centre ▪ Provides advisory ▪ Facilitates loans to ▪ Houses the Bank’s support to bank on the MSE and promotes Marketing Dept, Retail medium
Slide 46: About Us
@ yy About Us 46
Slide 47: Milestones
Milestones FIRST among the private FIRST bank in the private sector banks in Kerala to sector in India to open a become a scheduled bank in Currency Chest on behalf of 1946 under the RBI Act the RBI in April 1992 FIRST private sector bank to FIRST bank in the private sector open a NRI branch in to s
Slide 48: Expansion since FY07
Expansion since FY07 Branch Network ATM Network ~2X ~8X 850 1,320 463 724 465 277 246 394 122 174 141 84 202 66 39 51 FY07 FY17 FY07 FY17 Kerala South Ex-Kerala Others (Rest of India) 48
Slide 49: Performance since FY07
Performance since FY07 Net Interest Income Profit After Tax CAGR : 16% Rs Crs Rs Crs CAGR : 14% 1,675 393 368 104 FY07 FY17 FY07 FY17 Business (Advances + Deposits) Gross NPA CAGR : 19% Rs Crs In % 149bps 112,507 3.94 2.45 20,158 FY07 FY17 FY07 FY17 49
Slide 50: Leadership Team
Leadership Team Mr. V. G Mathew , MD & CEO ▪ Post Graduate in Physics and CAIIB with over 37 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 51: 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 52: Management Team
Management Team Mr. John Thomas, Senior General Manager Mr. Benoy Varghese, Senior General Manager (Business Development Department) (Credit Department) • Bachelors Degree in Science, MBA and CAIIB • Bachelors Degree in Arts & Masters Degree in Business Administration and CAIIB Mr. Raphael T.J., Sen
Slide 53: Management Team
Management Team Mr. C.P. Gireesh, Chief Financial Officer • Bachelors Degree in Mathematics • Fellow member of the Institute of Chartered Accountants of India and Certified Associate of the Indian Institute of Banking & Finance Mr. Jacob EA, Chief Compliance Officer Mr. Jimmy Mathew, Company Secreta
Slide 54: Awards & Recognition
Awards & Recognition Awarded with ISO 27001:2013 Certification The certification process involved an extensive audit, conducted by British Standards Institution against the criteria set out by the ISO 27001:2013 standards on various domains of IT functions 54
Slide 55: Awards & Recognition
Awards & Recognition Won “IBA Banking Technology Awards” Won National Payments Excellence Awards - Won Finnoviti Award - 2017 2016 55
Slide 56: 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 Mr. C. P. Gireesh, CFO Ms. Payal Dave / Mr. Shogun Jain cpgireesh@sib.co.in shogun.jain@sgapl.net / sang