City Union Bank Limited · NSE:CUB
City Union Bank — Q1 FY2022-23 Earnings Presentation
54 slides from City Union Bank's earnings presentation, Aug 8, 2022
Slide 1: Cover letter: Investor presentation to exchanges
(>) City UNION BANK LIMITED cus! / CIN : L65110TN1904PLC001287 CcCuB Regd. Office : 149, T.S.R. (Big) Street, Kumbakonam - 612 001, Thanjavur District, Tamil Nadu. Telephone No : 0435 - 2402322 Fax : 0435 - 2431746 ‘TRUST AND EXCELLENCE SINCE 1904 E-mail : shares@cityunionbank.com Website : www.city
Slide 2: June 2022
JUNE 2022
Slide 3: Disclaimer
Disclaimer 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. Certain
Slide 4: Table of Contents
TABLE OF CONTENTS 4 10 14 Overview Performance Highlights – Financial Performance & June 2022 Business Profile 39 41 48 50 Branch Network Technology Initiatives Shareholding Pattern Corporate Governance 3
Slide 5: Overview
AISA TIP AA OVERVIEW ~
Slide 6: Overview Facts & Figures
OVERVIEW City Union Bank Ltd., the oldest Private Sector Bank in India, was founded on October 31, 1904 and is headquartered at Kumbakonam,Tamil Nadu, India. The main focus of the Bank – lending to MSME, Retail / WholesaleTrade Wholesale with granular asset profile including providing short term and
Slide 7: Key Milestones
KEY MILESTONES Rights Issue @ 1 : 4- Bonus Issue @ Amalgamation of ‘TheCity Entered into Preferential allotment to reward the existing 1 : 10 - Forward Bank Limited’ & agreement withTCS TCS for equity shares shareholders & employees rewarded Scheduled bank since ‘The Union Bank Limited’ for core ban
Slide 8: A Specialized Banking Model Aligned to Target Segment – SME/MSME
CITY UNION BANK - A SPECIALIZED BANKING MODEL ALIGNED TO TARGET SEGMENT – SME / MSME SME / MSME Prudent Risk Invested in Purely retail focus Management Robust Infrastructure Liability Franchise SME/MSME specialized SME exposures’ result in Comprehensive No Certificate of Deposit business model focus
Slide 9: Competitive Advantages
COMPETITIVE ADVANTAGES NETWORK STRONG TRACK RECORD Pan India presence with 727 branches Continuous profitability and dividend payout in all Strong presence in South India (644 branches) 115+ years of operations of which 495 are in Tamil Nadu alone Business growth of 20%+ CAGR in last 10 years ROBUST
Slide 10: Credit Rating
CREDIT RATING ICRA has assigned “AA-” for Long Term - issuers with this rating are considered to have “High Degree of Safety” regarding timely servicing of financial obligations. “A1+-” for Certificate of Deposits (CD) - issuers with this rating are considered to have “Strong Degree of Safety” regar
Slide 11: Performance Highlights – June 2022
PERFORMANCE HIGHLIGHTS – JUNE 2022 10
Slide 12: Q1 FY 2023 Performance – A Snapshot
Q1 FY 2023 PERFORMANCE – A SNAPSHOT Deposits increased by 9% from Rs.446 Bn to Rs.488 Bn Y-o-Y Advances registered a growth of 12% from Rs.364 Bn to Rs.409 Bn Y-o-Y Total business grown by 11% from Rs.810 Bn to Rs.897 Bn Y-o-Y Y Gross Profit increased by 17% to Rs.4,471 Mn from Rs.3,808 Mn (Q1-Vs-Q1
Slide 13: Q1 FY 2023 vs Q1 FY 2022 Performance – A Snapshot
Q1 FY 2023 VS Q1 FY 2022 PERFORMANCE – A SNAPSHOT (in INR Mn) 487,721 409,341 897,062 153,870 9% 12% 11% 25% 446,059 363,955 810,014 122,991 Deposits Advances Total Business CASA 4,471 2,251 5,249 39.78% 17% 30% 17% % 3,808 1,730 4,476 40.60% Gross Profit Net Profit Net Interest Cost to Income Incom
Slide 14: FY 2022 vs FY 2021 Performance – A Snapshot
FY 2022 VS FY 2021 PERFORMANCE – A SNAPSHOT (in INR Mn) 476,897 411,560 888,457 155,294 7% 11% 9% 20% 445,373 370,206 815,579 129,814 Deposits Advances Total Business CASA 15,953 7,602 19,165 40.37% 9% 28% 5% % 14,678 5,928 18,297 41.72% Gross Profit Net Profit Net Interest Cost to Income Income 1.3
Slide 15: Financial Performance & Business Profile
FINANCIAL PERFORMANCE & BUSINESS PROFILE 14
Slide 16: Q1 FY 23 vs Q1 FY 22 Performance - A Snapshot
Q1 FY 23 VS Q1 FY 22 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q1 FY 2023 Q1 FY 2022 INC / (DEC) Growth Growth % Deposits 487,721 446,059 41,662 9% Advances 409,341 363,955 45,386 12% Total Business 897,062 810,014 87,048 11% Demand Deposits 46,401 33,370 13,031 39% Savi
Slide 17: Q1 FY 23 vs Q1 FY 22 Performance - A Snapshot
Q1 FY 23 VS Q1 FY 22 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q1 FY 2023 Q1 FY 2022 INC / (DEC) Growth % Q4 FY 2022 Net Interest Income 5,249 4,476 773 17% 5,007 Other Income 2,175 1,934 241 12% 2,029 Operating Expenses 2,953 2,602 351 13% 2,638 Gross Profit 4,471 3,808
Slide 18: FY 22 vs FY 21 Performance - A Snapshot
FY 22 VS FY 21 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS FY 2022 FY 2021 INC / (DEC) Growth Growth % Deposits 476,897 445,373 31,524 7% Advances 411,560 370,206 41,354 11% Total Business 888,457 815,579 72,878 9% Demand Deposits 46,193 37,537 8,656 23% Saving Deposits 10
Slide 19: FY 22 vs FY 21 Performance - A Snapshot
FY 22 VS FY 21 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS FY 21-22 FY 20-21 INC / (DEC) Growth % Net Interest Income 19,165 18,297 868 5% Other Income 7,591 6,887 704 10% Operating Expenses 10,803 10,506 297 3% Gross Profit 15,953 14,678 1,275 9% Provisions & Contingencie
Slide 20: Provisions & Contingencies – Breakup
PROVISIONS & CONTINGENCIES – BREAKUP (in INR Mn) PARTICULARS Q1 FY 23 Q1 FY 22 FY 21-22 FY 20-21 Provision for: - Tax 700 400 2,250 1,000 - Bad Debts 1,400 2,330 5,535 5,990 - Contingency / Covid 19 120 -830 - 80 310 - Standard Assets - 130 550 1,045 - Restructuring / FITL - 3 107 265 - Others - 45
Slide 21: Q1 FY 23 vs Q1 FY 22 – Income and Expenses Breakup
Q1 FY 23 VS Q1 FY 22 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP Q1 FY Q1 FY Q1 FY Q1 FY PARTICULARS Growth % PARTICULARS Growth % 2023 2022 2023 2022 Interest on Loans 9,018 8,560 5% Int Exp on Deposits 5,194 5,405 -4% Interest on Investments 1,895 1,
Slide 22: FY 22 vs FY 21 – Income and Expenses Breakup
FY 22 VS FY 21 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP FY FY FY FY PARTICULARS Growth % PARTICULARS Growth % 2022 2021 2022 2021 Interest on Loans 34,540 35,078 -2% Int Exp on Deposits 21,197 22,348 -5% Interest on Investments 6,305 5,828 8% Other
Slide 23: Strong Deposits and Advances Growth
STRONG DEPOSITS AND ADVANCES GROWTH (in INR Mn) DEPOSITS ADVANCES 4,76,897 4,87,721 4,45,370 3,84,480 4,08,325 4,11,560 4,09,341 3,45,762 3,70,206 3,30,652 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 30-JUN-2022 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 30-JUN-2022 BUSINESS CASA 8,88,457 8
Slide 24: Income Growth Over the Years
INCOME GROWTH OVER THE YEARS… (in INR Mn) NET INTEREST INCOME GROWTH OTHER INCOME GROWTH 7,591 19,165 6,799 6,887 18,297 16,115 16,752 5,144 5,249 (3M) 2,175 (3M) 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 30-JUN-2022 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 30-JUN-2022 CEB GROWTH NET PR
Slide 25: Key Business Indicators
KEY BUSINESS INDICATORS PARTICULARS Q1 FY 23 Q1 FY 22 Q4 FY 22 FY 21-22 FY 20-21 Cost of Deposits 4.43% 4.95% 4.54% 4.68% 5.36% Yield on Advances 9.04% 9.40% 9.26% 9.36% 9.91% Yield on Investments 5.82% 5.61% 5.70% 5.71% 5.86% Net Interest Margin 3.95% 3.86% 4.01% 3.98% 4.00% Cost to Income 39.78% 4
Slide 26: Key Business Ratios – Yearly Trends
KEY BUSINESS RATIOS – YEARLY TRENDS NET INTEREST MARGIN RETURN ON ASSETS 5.00% 1.70% 1.64% 1.60% 4.50% 4.32% 1.46% 1.50% 1.40% 1.35% 3.98% 4.00% 3.98% 3.95% 4.00% 1.30% 1.20% 1.15% 3.50% 1.10% 1.00% 1.00% 3.00% 0.90% 31-MAR-19 31-MAR-20 31-MAR-21 31-MAR-22 30-JUN-22 31-MAR-19 31-MAR-20 31-MAR-21 31-
Slide 27: Cost of Deposits & Yield on Advances
COST OF DEPOSITS & YIELD ON ADVANCES (in %) 16 14 13.49 13.43 13.18 12.83 12.10 12 11.46 10.95 10.76 9.91 10 9.36 9.04 8.44 8.37 8.15 7.62 8 6.82 6.29 6.17 6.20 6 5.36 4.68 4.43 4 2 0 Mar 13 Mar 14 Mar 15 Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Mar 21 Mar 22 Jun 22 Spread between cost of deposits and yie
Slide 28: Efficiency
EFFICIENCY COST INCOME RATIO (%) CASA RATIO (%) 42.47 32.56 31.55 42.12 29.15 41.72 25.22 24.97 40.37 39.78 31-Mar-2019 31-Mar-2020 31-Mar-2021 31-Mar-2022 30-Jun-2022 31-Mar-2019 31-Mar-2020 31-Mar-2021 31-Mar-2022 30-Jun-2022 BUSINESS PER EMPLOYEE PROFIT PER EMPLOYEE (in INR Mn) (in INR Mn) 165.45
Slide 29: Loan Book – Products Composition
LOAN BOOK – PRODUCTS COMPOSITION % toTotal Advances 1% Working capital loans yielding higher interest constitute 62% of advances Bills Purchased & Bills Discounted Re-pricing possible at short intervals Term Loan thus reducing interest rate risk 37% Cash Credit & Demand Loan ~90% of our loan book is
Slide 30: Loan Book Sectoral Deployment – Position as on 30.06.2022
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 30.06.2022 (in INR Mn) Large Loans collateralized Industries by Deposits 5,936 2% Retail Traders 6,258 2% 9,352 2% NBFC Personal Loans 4,207 1% 2% 9,470 Infrastructure 3,490 1% Others 13,904 3% Housing Loan 19,809 5% Wholesale Traders 6% 43% 24,322 SECT
Slide 31: Loan Book Sectoral Deployment – Secured & Unsecured Advances
LOAN N BOOK SECTORAL DEPLOYMENT – POSITION AS ON 30.06.2022 (in INR Mn) SECURED & UNSECURED ADVANCES Particulars Amount (INR Mn) (%) Secured Loans 406,735 99% Unsecured Loans 2,606 1% Total 409,341 Trading & MSME loans constitute about 51% Diversified credit portfolio reduces credit risk and Lower t
Slide 32: Loan Book – Advances to Major Industries
Corporate Governance Loan Book – Advances to Major Industries (i n I N R M n ) Advances to Major Industries 30th June 2022 TEXTILE a) Cotton 17,877 (4%) b) Other Textiles 23,674 (6%) METALS a) Iron & Steel 8,692 (2%) Amount % to Total Industry Name b) Other Metals 7,416 (2%) (in INR Mn) Advances PAP
Slide 33: Loan Book - Driver to Growth – Q1 FY 23
LOAN BOOK - DRIVER TO GROWTH – Q1 FY 23 During the last few quarters, we have given more thrust to Gold Loans which is increased by 37% from Rs.69,060 Mn in Q1 FY 22 to Rs.94,944 Mn in Q1 FY 23. Also, the % of Gold Loans portfolio to Gross Advances improved to 23% (in INR Mn) GOLD LOAN PORTFOLIO J
Slide 34: Asset Quality
ASSET QUALITY (in INR Mn) GROSS NPA QTM & GROSS NPA % NET NPA QTM & NET NPA % 19,332 19,035 11,911 11,612 18,932 10,752 14,134 7,785 9,771 5.11% 5,915 4.70% 4.65% 2.97% 2.95% 2.89% 4.09% 2.29% 1.81% 2.95% 31-Mar-19 31-Mar-20 31-Mar-21 31-Mar-22 30-Jun-22 31-Mar-19 31-Mar-20 31-Mar-21 31-Mar-22 30-Ju
Slide 35: Asset Quality Position – Movement Over the Years
ASSET QUALITY POSITION – MOVEMENT OVER THE YEARS (In INR MN) FY MAR-18 FY MAR-19 FY MAR-20 FY MAR-21 FY MAR-22 Q1 FY 23 NPA Opening balance 6,820 8,565 9,771 14,134 18,932 19,332 Additions A 5,749 6,322 11,104 11,131 12,757 2,702 Recovery made 1,623 1,980 1,644 1,950 4,424 1,054 Upgradations 433 496
Slide 36: Asset Quality – Gold Loan Portfolio
ASSET QUALITY – GOLD LOAN PORTFOLIO Position as on 30th June 2022 (In INR MN) No. of A/cs Balance Gold Loan –Total 762,316 94,944 Of which, - Standard Accounts 761,776 94,866 - N PA 540 78 Gross NPA 19,035 % of Gold Loan NPA to Gold Loan Portfolio 0.08% % of Gold Loan NPA to Gross NPA 0.41% 35
Slide 37: Restructured Accounts
RESTRUCTURED ACCOUNTS Quarterwise balance outstanding in respect of Restructured Standard borrowers (In INR MN) Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Type of Restructuring No. of No. of No. of No. of No. of Amt Amt Amt Amt Amt Borrowers Borrowers Borrowers Borrowers Borrowers MSME 299 12629 333 15398 3
Slide 38: Security Receipts
SECURITY RECEIPTS During Q1 FY 23, we have not sold any accounts to ARC. Balance outstanding of Security Receipts wrt NPA sold to ARC Period ended Amount (in INR Mn) Mar-20 2474 Dec-20 1444 Mar-21 1429 Jun-21 1308 Sep-21 1177 Dec-21 1118 Mar-22 917 Jun-22 819 In the FY 13-14 & 14-15, we had sold som
Slide 39: Investments – At a Glance
INVESTMENTS – AT AGLANCE Investments Breakup and Category-wise (in INR Mn) Particulars JUN 2022 JUN 2021 SLR Securities 136,619 99,516 Non-SLR Securities 1,492 1,784 Total Investments 138,111 101,300 Yield on Investments 5.82% 5.61% Investments Breakup: -A FS 28,379 (21%) 7,334 (7%) - HTM 109,732 (7
Slide 40: Branch Network
BRANCH NETWORK 39
Slide 41: Strong Presence in the South
STRONG PRESENCE IN THE SOUTH As of June 2022 - 727 branches. 644 branches are located in South India out of which 495 in Tamil Nadu. No. of % of % of % of State Branches Deposits Advances Business Ta milna du 495 81 66 74 Ka rnataka 41 6 5 6 Andhra prades h 49 2 8 5 1 Telengana 35 3 6 4 3 2 Maharash
Slide 42: Digital Banking Initiatives
DIGITAL BANKING INITIATIVES 41
Slide 43: Digital Transaction Growth
Digital Transaction Growth Net Banking Mobile Banking UPI Transaction Transaction Volume Transaction Volume %& Average transaction per month Average transaction per month Average transaction per month (Volume in Rs Lakhs) (Volume in Rs Lakhs) (Volume in Rs Lakhs) 26.31| #44 20.04 | #4444 Net Banking
Slide 44: New Product Offerings
New Product Offerings Product Offerings 01 02 03 04 05 New UPI DHI Connected Tap & Go Easy Buy Initiatives 123 Pay Credit Card Banking Card-less Whatsapp Pay to Scan & Pay/ cash BBPS Products Banking Contact QR withdrawal (ICCW) AI / Robotic Digital API Conversational Process Video Technology/ Lendi
Slide 45: Digital Banking Products
Digital Banking Products Retail Banking Corporate Banking Savings Account Opening Using Video KYC Online Current Account Opening Online Address Change Request Positive Pay 24*7 Fund Transfers Digital Signature [Hard / Soft] Cardless Withdrawal Letter of Credit through Net Banking Deposit Online Serv
Slide 46: Strategic Partnerships
Strategic Partnerships Fintech Partnerships Payment Aggregators 45
Slide 47: CUB UPI
CUB UPI UPI 123PAY is an instant payment system for feature phone users UPI Features Digital Payment promoted for financial inclusion for semi-urban / rural customers PAY TO SEND MONEY CONTACT REQUEST IPO USING MONEY UPI ID SCAN & PAY MERCHANT USING CUB & PAYMENTS OTHER BANK A/C Register for UPI wit
Slide 48: Awards
AWARDS INTERNATIONAL SERVICE PRIDE AWARDS 2022 MOST TRUSTED DIGITAL BANK OF THE YEAR City Union Bank received City Union Bank received Economic Times Finnoviti Awards 2022 City Union Bank won the "DATA CON AWARD" "Most Trusted Digital Bank of the Year" Award for 'UPI 123 Pay' by Banking Frontiers Un
Slide 49: Shareholding Pattern
SHAREHOLDING PATTERN 48
Slide 50: A Well Diversified Investor Base
A WELL DIVERSIFIED INVESTOR BASE Position as on 30-Jun-2022 Major Institutional Shareholders SHAREHOLDERS HOLDING % QIB, NRI, 6.77 0.95 HDFC MID – CAP OPPORTUNITIES FUND 4.48 AXIS MUTUAL FUND 4.06 Corp Bodies, Others, FRANKLIN INDIA EQUITY SAVINGS FUND 3.94 0.83 2.82 LIFE INSURANCE CORPORATION OF IN
Slide 51: Corporate Governance
CORPORATE GOVERNANCE 50
Slide 52: A Well Experienced and Strong Board
A WELL EXPERIENCED AND STRONG BOARD Shri. M. Narayanan | B.Sc. FCA, Grad CMA, DISA Dr N. Kamakodi | B.Tech., MBA., PhD., CAIIB Non-Executive Chairman M.D. & C.E.O. Shri. M. Narayanan is a practicing Chartered Accountant by profession and has Dr. N. Kamakodi is serving as MD & CEO of the Bank from Ma
Slide 53: Transparent Corporate Governance Practices
TRANSPARENT ‘CORPORATE GOVERNANCE’ PRACTICES Board consists Various sub- of 9 Independent committees of Code of conduct Directors (including Board functions Disclosure norms KYC / AML for Directors and 1 WomenDirector) to oversee the strictly adhered to Norms strictly Senior Management And 1 Executi
Slide 54: City Union Bank Ltd Investor Contact
CITY UNION BANK LTD Regd.Office :149,TSR Big Street,Kumbakonam Street, – 612001,Tamilandu. Admin Office :"Narayana" No.24 B,Gandhi Gandhi Nagar,Kumbakonam - 612001,Tamil Nadu. Tel :0435-2402322, 2401622,| FAX:0435 0435-2431746 | www.cityunionbank.com INVESTOR CONTACT Name :K.Jayaraman Jayaraman,GM M