City Union Bank Limited · NSE:CUB
City Union Bank — Investor Presentation (December 2022)
56 slides from City Union Bank's investor presentation, December 2022
Slide 1: City Union Bank - December 2022
City UNION BANK
Slide 2: 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 3: Table of Contents
TABLE OF CONTENTS 4 10 15 Overview Performance Highlights – Financial Performance & December 2022 Business Profile 42 44 51 53 Branch Network Digital Initiatives Shareholding Pattern Corporate Governance 3
Slide 4: Overview
OVERVIEW 4
Slide 5: 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 6: 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 7: 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 8: Competitive Advantages
COMPETITIVE ADVANTAGES NETWORK STRONG TRACK RECORD Pan India presence with 752 branches Continuous profitability and dividend payout in all Strong presence in South India (669 branches) 115+ years of operations of which 519 are in Tamil Nadu alone Business growth of 15% CAGR in last 10 years ROBUST
Slide 9: 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 10: Performance Highlights – December 2022
PERFORMANCE HIGHLIGHTS – DECEMBER 2022 10
Slide 11: Q3 FY23 / 9M FY23 Performance – A Snapshot
Q3 FY 23 / 9M FY 23 PERFORMANCE – A SNAPSHOT Deposits increased by 7% from Rs.467 Bn to Rs.500 Bn Y-o-Y Advances registered a growth of 12% from Rs.384 Bn to Rs.430 Bn Y-o-Y Total business grown by 9% from Rs.851 Bn to Rs.930 Bn Y-o-Y Gross Profit increased by 35% to Rs.4,973 Mn from Rs.3,696 Mn (Q3
Slide 12: Q3 FY23 vs Q3 FY22 Performance – A Snapshot
Q3 FY 23 VS Q3 FY 22 PERFORMANCE – A SNAPSHOT (in INR Mn) 499,974 430,087 930,061 146,055 7% 12% 9% 5% 467,217 383,871 851,088 139,184 Deposits Advances Total Business CASA 4,973 2,178 5,557 36.24% 35% 11% 13% % 3,696 1,961 4,900 43.13% Gross Profit Net Profit Net Interest Cost to Income Income 1.34
Slide 13: 9M FY23 vs 9M FY22 Performance – A Snapshot
9M FY 23 VS 9M FY 22 PERFORMANCE – A SNAPSHOT (in INR Mn) 499,974 430,087 930,061 146,055 7% 12% 9% 5% 467,217 383,871 851,088 139,184 Deposits Advances Total Business CASA 14,009 7,194 16,485 38.12% 21% 31% 16% % 11,555 5,512 14,158 41.41% Gross Profit Net Profit Net Interest Cost to Income Income
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 15
Slide 16: Q3 FY23 vs Q3 FY22 Performance - A Snapshot
Q3 FY 23 VS Q3 FY 22 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q3 FY 23 Q3 FY 22 INC / (DEC) Growth Growth % Q2 FY 23 Deposits 499,974 467,217 32,757 7% 498,776 Advances 430,087 383,871 46,216 12% 427,016 Total Business 930,061 851,088 78,973 9% 925,792 Term Deposits 353
Slide 17: Q3 FY23 vs Q3 FY22 Performance - A Snapshot
Q3 FY 23 VS Q3 FY 22 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q3 FY 23 Q3 FY 22 INC / (DEC) Growth % Q2 FY 23 Net Interest Income 5,557 4,900 657 13% 5,679 Other Income 2,243 1,600 643 40% 1,735 Operating Expenses 2,827 2,804 23 1% 2,849 Gross Profit 4,973 3,696 1,277 3
Slide 18: 9M FY23 vs 9M FY22 Performance - A Snapshot
9M FY 23 VS 9M FY 22 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS 9M FY 23 9M FY 22 INC / (DEC) Growth % Net Interest Income 16,485 14,158 2,327 16% Other Income 6,153 5,562 591 11% Operating Expenses 8,629 8,165 464 6% Gross Profit 14,009 11,555 2,454 21% Provisions & Cont
Slide 19: FY22 vs FY21 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 20: FY22 vs FY21 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 21: Provisions & Contingencies – Breakup
PROVISIONS & CONTINGENCIES – BREAKUP (in INR Mn) PARTICULARS Q3 FY 23 Q3 FY 22 9M FY 23 9M FY 22 FY 21-22 Provision for: - Tax 550 500 2,000 1,650 2,250 - Bad Debts 2,700 875 5,150 4,385 5,535 - Covid 19 (250) 300 (130) (530) - 80 - Standard Assets (150) 10 (150) 450 550 - Restructuring / FITL - - -
Slide 22: Q3 FY23 vs Q3 FY22 – Income and Expenses Breakup
Q3 FY 23 VS Q3 FY 22 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP Q3 FY Q3 FY Q3 FY Q3 FY PARTICULARS Growth % PARTICULARS Growth % 23 22 23 22 Interest on Loans 9,695 8,646 12% Int Exp on Deposits 5,732 5,272 9% Interest on Investments 2,168 1,656 31%
Slide 23: 9M FY23 vs 9M FY22 – Income and Expenses Breakup
9M FY 23 VS 9M FY 22 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP 9M FY 9M FY 9M FY 9M FY PARTICULARS Growth % PARTICULARS Growth % 23 22 23 22 Interest on Loans 28,266 25,838 9% Int Exp on Deposits 16,453 16,044 3% Interest on Investments 6,197 4,560 3
Slide 24: FY22 vs FY21 – 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 25: Strong Deposits and Advances Growth
STRONG DEPOSITS AND ADVANCES GROWTH (in INR Mn) DEPOSITS ADVANCES 4,76,897 4,99,974 4,45,370 4,08,325 4,11,560 4,30,087 3,84,480 3,45,762 3,70,206 3,30,652 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 31-DEC-2022 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 31-DEC-2022 BUSINESS CASA 8,88,457 9
Slide 26: Income Growth Over the Years
INCOME GROWTH OVER THE YEARS… (in INR Mn) NET INTEREST INCOME GROWTH OTHER INCOME GROWTH 19,165 18,297 7,591 6,799 6,887 6,153 (9M) 16,752 5,144 16,485 (9M) 16,115 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 31-DEC-2022 31-MAR-2019 31-MAR-2020 31-MAR-2021 31-MAR-2022 31-DEC-2022 CEB GROWTH NET P
Slide 27: Key Business Indicators
KEY BUSINESS INDICATORS PARTICULARS Q3 FY 23 Q3 FY 22 9M FY 23 9M FY 22 FY 21-22 Cost of Deposits 4.62% 4.58% 4.52% 4.72% 4.68% Yield on Advances 9.16% 9.29% 9.20% 9.39% 9.36% Yield on Investments 5.91% 5.76% 5.86% 5.71% 5.71% Net Interest Margin 3.88% 4.00% 3.97% 3.97% 3.98% Cost to Income 36.24% 4
Slide 28: Key Business Ratios – Yearly Trends
KEY BUSINESS RATIOS – YEARLY TRENDS NET INTEREST MARGIN RETURN ON ASSETS 5.00% 1.70% 1.64% 1.60% 1.51% 4.50% 4.32% 1.50% 1.40% 1.35% 3.98% 4.00% 3.98% 3.97% 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 31-DEC-22 31-MAR-19 31-MAR-20 31-MAR-21 31-
Slide 29: 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 9.20 8.44 8.37 8.15 7.62 8 6.82 6.29 6.17 6.20 6 5.36 4.68 4.52 4 2 0 Mar 13 Mar 14 Mar 15 Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Mar 21 Mar 22 Dec 22 Spread between cost of deposits and yie
Slide 30: Efficiency
EFFICIENCY COST INCOME RATIO (%) CASA RATIO (%) 42.47 32.56 42.12 41.72 29.15 29.21 25.22 24.97 40.37 38.12 31-Mar-2019 31-Mar-2020 31-Mar-2021 31-Mar-2022 31-Dec-2022 31-Mar-2019 31-Mar-2020 31-Mar-2021 31-Mar-2022 31-Dec-2022 BUSINESS PER EMPLOYEE PROFIT PER EMPLOYEE (in INR Mn) (in INR Mn) 165.45
Slide 31: Loan Book – Products Composition
LOAN BOOK – PRODUCTS COMPOSITION % toTotal Advances 1% Working capital loans yielding higher interest constitute 64% of advances Bills Purchased & Bills Discounted Term Loan 35% Cash Credit & Re-pricing possible at short intervals Demand Loan thus reducing interest rate risk 64% Loan Book Products C
Slide 32: Loan Book Sectoral Deployment – Position as on 31.12.2022
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 31.12.2022 (in INR Mn) Loans collateralized by Deposits 6,013 Retail Trade Large 6,759 Industries Personal Loan 7,620 NBFC 9,296 4,384 3% Infrastructure Others 2% 2% 3,389 17,089 2% 4% Wholesale Traders 14,926 3% Housing Loan 5% 20,533 44% SECTORAL MSME
Slide 33: Loan Book Sectoral Deployment – Secured & Unsecured Advances
LOAN N BOOK SECTORAL DEPLOYMENT – POSITION AS ON 31.12.2022 (in INR Mn) SECURED & UNSECURED ADVANCES Particulars Amount (INR Mn) (%) Secured Loans 427,660 99% Unsecured Loans 2,427 1% Total 430,087 100% Trading & MSME loans constitute 50% of loan portfolio Diversified credit portfolio reduces credit
Slide 34: 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 31st December 2022 TEXTILE a) Cotton 18,989 (4%) b) Other Textiles 26,110 (6%) METALS a) Iron & Steel 10,055 (2%) Amount % to Total Industry Name b) Other Metals 9,467 (2%) (in INR Mn) Advances
Slide 35: Loan Book - Driver to Growth – Q3 FY23
LOAN BOOK - DRIVER TO GROWTH – Q3 FY 23 During the last few quarters, we have given more thrust to Gold Loans which is increased by 31% from Rs.81,697 Mn in Q3 FY 22 to Rs.107,239 Mn in Q3 FY 23. Also, the % of Gold Loans portfolio to Gross Advances improved to 25% (in INR Mn) GOLD LOAN PORTFOLIO
Slide 36: Asset Quality
ASSET QUALITY (in INR Mn) GROSS NPA QTM & GROSS NPA % NET NPA QTM & NET NPA % 19,332 19,887 11,911 18,932 18,618 11,287 11,245 10,752 14,134 7,785 9,771 5.11% 5,915 4.70% 4.62% 4.36% 2.97% 2.95% 2.67% 4.09% 2.69% 2.29% 1.81% 2.95% 31-Mar-19 31-Mar-20 31-Mar-21 31-Mar-22 30-Sep-22 31-Dec-22 31-Mar-19
Slide 37: Asset Quality Position – Movement Over the Years
ASSET QUALITY POSITION – MOVEMENT OVER THE YEARS (In INR MN) FY MAR-18 FY MAR-19 MAR FY MAR-20 FY MAR-21 FY MAR-22 Q3 FY 23 9M FY 23 NPA Opening balance 6,820 8,565 9,771 14,134 18,932 18,618 19,332 Additions A 5,749 6,322 11,104 11,131 12,757 4,391 9,708 Recovery made 1,623 1 1,980 1,644 1,950 4,42
Slide 38: Asset Quality – Gold Loan Portfolio
ASSET QUALITY – GOLD LOAN PORTFOLIO (In INR MN) No. of A/cs Balance Gold Loan –Total 617,943 107,239 Of which, - Standard Accounts 617,391 107,191 - N PA 552 48 Gross NPA 19,887 % of Gold Loan NPA to Gold Loan Portfolio 0.04% % of Gold Loan NPA to Gross NPA 0.24% 38
Slide 39: Restructured Accounts
RESTRUCTURED ACCOUNTS Quarterwise balance outstanding in respect of Restructured Standard borrowers (In INR Mn) Dec-21 Mar-22 Jun-22 Sep-22 Dec-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 314 15226 395 15032 3
Slide 40: Security Receipts
SECURITY RECEIPTS During Q3 FY 23, we have not sold any accounts to ARC on SR basis Balance outstanding of Security Receipts wrt NPA sold to ARC Period ended Amount (in INR Mn) Mar-20 2474 Mar-21 1429 Mar-22 917 Jun-22 819 Sep-22 804 Dec-22 12 In the FY 13-14 & 14-15, we had sold some of the NPA ac
Slide 41: Investments – At a Glance
INVESTMENTS – AT AGLANCE Investments Breakup and Category wise (in INR Mn) Particulars Dec 2022 Dec 2021 SLR Securities 143,633 118,657 Non-SLR Securities 919 2,143 Total Investments 144,552 120,800 Yield on Investments 5.86% 5.72% Investments Breakup: -A FS 30,085 (21%) 18,150 (15%) - HTM 114,467 (
Slide 42: Branch Network
BRANCH NETWORK 42
Slide 43: Strong Presence in the South
STRONG PRESENCE IN THE SOUTH As of Dec 2022 - 752 branches. 669 branches are located in South India out of which 519 in Tamil Nadu. We have opened our 500th branch inTamil Nadu. No. of % of % of % of State Branches Deposits Advances Business Ta mi l na du 519 81 67 74 Ka rna ta ka 41 6 5 5 Andhra pr
Slide 44: Digital Initiatives
DIGITAL INITIATIVES 44
Slide 45: New Digital Product Offerings
New Digital Product Offerings Product Offerings 01 02 03 04 05 New Initiatives UPI DHI Connected Voice 123Pay Credit Card Tap & Go Banking Biometric Interoperable Products Whatsapp Pay to Scan & Pay/ Card-less Cash BBPS Banking Contact QR Withdrawal Robotic Digital Technology/ API AI/ Conversational
Slide 46: Pay Tax Online
Pay Tax Online GST & Income Tax CUB customers can now pay their Direct and Indirect Taxes (GST and Income Tax) online using CUB account. This will enable customers to make Tax Payments through Net/Mobile Banking and through Branch Counters
Slide 47: New Digital Initiatives
New Digital Initiatives CUB Dhi Credit Card Introduction of Soft Token as Multi Factor Authentication CUB launched its own credit card - CUB Dhi Credit Card Tied up with VISA for Credit card issuance & technology partnership with 42CS Soft Token for Retail customers Both secured and unsecured cards
Slide 48: Account Aggregator Framework
Account Aggregator Framework on Sahamati Platform Account Aggregator framework allows sharing of financial information from various institutions in a secure and convenient manner. Gone live as FIP (Financial Information Provider) / FIU (Financial Information User) to allow consent requests raised fo
Slide 49: Strategic Partnerships
Strategic Partnerships Corporate Digital Banking Marketing Solutions Digitization Voice Biometric Cards AI/ML Conversational Bot Customer Merchants/ Onboarding Digital Collections Landing
Slide 50: Recent Awards
Recent Awards Indian Banks’ Association SFBC (Kerala) 3 Winner awards in categories Best Digital Best Fintech Best Financial Engagement Collaboration Inclusion 1 Special award for Second Best Bank all over India among other than Large Private Sector Banks. Best Technology Talent
Slide 51: Shareholding Pattern
SHAREHOLDING PATTERN 51
Slide 52: A Well Diversified Investor Base
A WELL DIVERSIFIED INVESTOR BASE Position as on 31-Dec-2022 Major Institutional Shareholders SHAREHOLDERS HOLDING % QIB, NRI, 5.25 0.88 SMALLCAP WORLD FUND, INC 4.95 AXIS MUTUAL FUND 4.92 Corp Bodies, Others, HDFC MUTUAL FUND 4.47 2.19 2.97 CANARA ROBECO MUTUAL FUND 2.69 TEMPLETON INDIA VALUE FUND 2
Slide 53: Corporate Governance
CORPORATE GOVERNANCE 53
Slide 54: 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 55: 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 MD & CEO
Slide 56: City Union Bank Ltd
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
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