Federal Bank Ltd. (india) · NSE:FEDERALBNK
Federal Bank Ltd. (india) — The Federal Bank — Non-Deal Roadshow (June 2023)
27 slides from Federal Bank Ltd. (india)'s roadshow presentation, Jun 14, 2023
Slide 1: Exchange filing cover letter: Presentation to Investors/Analysts
Secretarial Department SD/ LODR/91/2023-24 June 14,2023 The Manager The Manager Listing Department Department of Corporate Services The National Stock Exchange of India Limited BSE Limited Exchange Plaza, Bandra-Kurla Complex, Phiroze Jeejeebhoy Towers, Bandra (E), Mumbai – 400 051. Floor 25, Dalal
Slide 2: Corporate presentation June 2023
* Corporate presentation June 2023 * Trademark application is under process currently
Slide 3: Federal Bank at a Glance
Federal Bank at a Glance SCALE PROFITABILITY REACH Net advances: (All amounts in INRmm) Return on Assets: Branches: 1,355 (Mar-23) 1,744,469 1.28% (FY23) 1,318,786 “Gross advances market share of 1.25% Mar-21 Mar-23 1 “Increased by 43 bps since FY21 ATMs & Cash recyclers: Deposits: (All amounts in I
Slide 4: Execution playbook proven with Consistent Performance
Execution playbook proven with Consistent Performance FY2021 FY2022 FY2023 FY 2024 & Beyond ENVIRONMENT • 1st wave of COVID • 2nd wave of COVID • Geopolitical tensions at center stage • Geoeconomic fragmentation ECONOMIC • GDP contraction leading to slowing • Geopolitical tension at centre stage glo
Slide 5: Business Architecture designed to foster growth & deliver sustainable returns
Business Architecture designed to foster growth & deliver sustainable returns BUSINESS ARCHITECTURE DESIGNED TO BE PAPERLESS, CONTACTLESS & CASHLESS Diversified product mix & consistent growth 4D mantra as an enabler Solid foundational structure Robust credit framework Pursuing high margin lending p
Slide 6: Attractive macro-economic and industry dynamics with strong growth tailwinds
Attractive macro-economic and industry dynamics with strong growth tailwinds India is expected to be the fastest growing major economy1 from … with highly underpenetrated credit… FY24E onwards… 216% Nominal GDP growth % (YoY) Domestic credit to private sector (% of GDP) - CY2021 197% 178% India Chin
Slide 7: Key Highlights
Key Highlights Retail oriented with a strong liability franchise 1 Diversified advances portfolio with a focus towards expanding high margin lending products 2 KEY LEVERS Multi-pronged distribution approach 3 Data driven decision making & robust risk control framework leading to improvement in asset
Slide 8: Retail oriented with a strong liability franchise
1 Retail oriented with a strong liability franchise Growing deposit base Deposit Market Share1 Multiple debit card offerings CASA + Dep <= INR 20mm Other (Amounts in INRmm) +17% 2,133,860 1.13% 5th largest private 4.9% share on total 1,726,445 1,817,006 32.68% March 24, 2023 sector bank on spends am
Slide 9: Diversified advances portfolio…
2 Diversified advances portfolio… Consistent Growth & Scale Up Gross advances Mix Net Advances (Amounts in INRmm) (As of Mar-23) +20% 1,744,469 Granular Retail Book 1,449,283 1,318,786 Other Housing Agri BuB LAP Auto Personal CV / CE retail 26% 24% 15% 10% 6% 3% 2% 14% 17% 21% 14% 18% 29% 37% 71% 11
Slide 10: … with a focus towards expanding high margin lending products
2 … with a focus towards expanding high margin lending products Credit Cards 14,864 543K+ High margin lending products1 451% Gross advances Cards-In-Force2 YoY growth (INRmm) Personal Loans 23,929 37% Gross advances YoY growth (INRmm) Digital loan platform 33.1% Mar-23 MSME (BuB + CoB) 314,472 26K+
Slide 11: Distribution - A Multi Pronged Approach
3 Distribution - A Multi Pronged Approach Continuous investment in Fintech arrangements expanding Pan India footprint Mar-21 Mar-23 Added 73 branches in FY23 Branches Branches Digital 1,272 1,355 Customers LITE BRANCH @ & many more…. HEAVY DISTRIBUTION Core Sales / Magnify reach through Driven by al
Slide 12: Fintech arrangements and Digitization strategy as a growth driver
3 Fintech arrangements and Digitization strategy as a growth driver Attracting multiple Fintech arrangements... … with key enablers in place… … driving business results Further enhanced and enriched ✓ Favourable structure: Served through ✓ Contributors driving business growth through continuous inno
Slide 13: Data driven decision making with analytics as a backbone
4 Data driven decision making with analytics as a backbone Empoweringwell-informeddecisions across levelsand functions Customer Relationship Asset Delinquency Process Fraud Risk Engagement Management Underwriting Management Optimisation Micro-Segmentation Anomaly Detection OptimisationM odels Acquis
Slide 14: Robust risk control framework leading to improvement in asset quality
4 Robust risk control framework leading to improvement in asset quality GNPA (%) NNPA (%) PCR (%) 70.021 3.41 1.19 2.80 0.96 12.36 0.691 65.54 65.14 Mar-21 Mar-22 Mar-23 Mar-21 Mar-22 Mar-23 Mar-21 Mar-22 Mar-23 Slippage Rate (%) Risk Adjusted NIM (%) Sourcing Independence of origination and underwr
Slide 15: Highly Granular Fee Income Franchise
5 Highly Granular Fee Income Franchise Robust Traction in Fee Income Pillars of Fee Income Business (Amounts in INRmm) 20,662 13% 14,925 14% Strong Opportunity Digital Analytics Multi 11,790 collaborations in The Capabilities & CRM Channel 63% 12% Customer Base Solution Distribution 62% 61% Selected
Slide 16: Group entities driving further value creation
6 Group entities driving further value creation Fedbank Financial Services Subsidiary Federal Operations & Services (FedServ) Subsidiary 73.2% 100% Scale: (42% YoY growth) Retail focused PAT: (74% YoY growth) NBFC offering Provides operational and Driving INR 79,997mm INR 1,801mm gold loans & instal
Slide 17: Experienced management team…
7 Experienced management team… 12+ 11+ Shalini Warrier 7+ Shyam Srinivasan Ashutosh Khajuria Executive Director Chief Mentor & Officer on Special Duty Managing Director & CEO Joined Federal Bank as the COO in 2015 and is currently Part of Federal Bank since 2011 and has served as the MD & CEO since
Slide 18: … and strong corporate governance
7 … and strong corporate governance 10 80% Total Board Independent Strong & Diverse Board Members Directors Women Women 41% 20% Focus on Gender diversity Representation Representation in workforce in the Board Investor Recognition Employee Recognition Governance Structure ESG Green Equity Investment
Slide 19: Strong financial track record
Strong financial track record NIM expansion, growing fee income, efficiency gains and reducing credit costs… NIM (%) Fee Income (% of total income) “Driven by pivot to 3.16 3.20 13.31 high margin lending 10.80 “Growth achieved products while 9.48 while adding retaining the granularity to the fee mom
Slide 20: Strong financial track record (cont’d)
Strong financial track record (cont’d) … resulting in increase in net profit and return ratios coupled with prudent use of capital Profit after tax (INRmm) RoE (%) 15.02 “Net profit in FY23 1 130,106 crossing INR 30,000mm “464 bps increase in growing at a CAGR of 10.38 10.87 RoE since FY21 18,898 38
Slide 21: Multiple levers in place for ROA expansion
Multiple levers in place for ROA expansion RoA (%) Key Levers for RoA Expansion 1.28 Consistent growth in advances and deposits 0.94 0.85 Enhance yields with focus on high margin lending products Increase fee income and cross-selling by leveraging data FY21 FY22 FY23 Improve efficiency with lite bra
Slide 22: Appendix
Appendix
Slide 23: Financials – Balance Sheet
Financials – Balance Sheet Data on a standalone basis Particulars (All amounts in INRmm) Mar-21 Mar-22 Mar-23 CAGR (21 -23) CAPITAL AND LIABILITIES Capital 3,992 4,205 4,232 3% Reserves and Surplus 157,252 183,733 210,830 16% Deposits 1,726,445 1,817,006 2,133,860 11% Borrowings 90,685 153,931 193,1
Slide 24: Financials – Income statement
Financials – Income statement Data on a standalone basis Particulars (All amounts in INRmm) FY21 FY22 FY23 CAGR (21-23) Interest Income 137,579 136,608 168,036 11% Interest Expenses 82,242 76,988 95,715 8% Net Interest Income 55,337 59,620 72,321 14% Other Income 19,587 20,891 23,300 9% Operating Ex
Slide 25: Glossary
Glossary Term Description Term Description Term Description AGRI Agriculture Loans DSA Direct Sales Agents NR Non-resident AI Artificial Intelligence ESG Environmental, Social, and Governance OEMs Original Equipment Manufacturers APIs Application Programming Interface GDP Gross Domestic Product PCR
Slide 26: Disclaimer
Disclaimer IMPORTANT: You must read the following before continuing. The following applies to this document, the oral presentation of the information in this document by The Federal Bank Limited (the “Bank”) or any person on behalf of the Bank, and any question-and-answer session that follows the or
Slide 27: Thank You
Thank You