City Union Bank Limited · NSE:CUB
City Union Bank — Q2 FY2024 Earnings Presentation
52 slides from City Union Bank's earnings presentation, Oct 27, 2023
Slide 1: City Union Bank Limited – Exchange filing cover letter
CITY UNION BANK LIMITED @) CIN : L65110TN1904PLC001287— _ : 7 Regd. Office ; 149, T.S.R. (Big) Street, Kumbakonam - 612 001, Thanjavur District, Tamil Nadu. ice ; wR. . 4 d : - 2431746 CUB Telephone No : 0435 - 2402322 Fax : 0435 - 243174 ee E-mail: shares@cityunionbank.com - Website : www.cityunion
Slide 2: Investor Presentation September 2023
INVESTOR PRESENTATION September 2023
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. Certai
Slide 4: Table of Contents
Table of Contents Overview ................................................................................................................................. ................................................................................................................... 04 Performance Highlights –
Slide 5: Overview
OVERVIEW 04
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 in Kumbakonam, Tamil Nadu, India. The main focus of the Bank – lending to MSME, Retail / Wholesale Trade with a granular asset profile including providing Short-term and long
Slide 7: Key Milestones
KEY MILESTONES 1998 Initial Public 1957 Offering (IPO); Took over Listing bank’s 1904 Common shares on the Incorporation Wealth BSE, NSE & MSE 06 of Bank Limited the Bank 02 04 03 1965 05 2002 01 1945 Scheduled bank Amalgamation Entered into since of ‘The City Forward Bank agreement with 22.03.1945
Slide 8: City Union Bank – Specialized banking model aligned to SME/MSME
CITY UNION BANK A SPECIALIZED BANKING MODEL ALIGNED TO TARGET SEGMENT – SME / MSME Prudent Risk Invested in Robust Purely retail Liability SME / MSME focus Management Infrastructure Franchise SME/MSME specialized SME exposures’ result in Comprehensive employee No Certificate of Deposit busin
Slide 9: Competitive Advantages
COMPETITIVE ADVANTAGES NETWORK STRONG TRACK RECORD • Continuous profitability and dividend payout • Pan India presence with 752 branches in all 115+ years of operations • Strong presence in South India (669 • Business growth of about 15% CAGR in last branches) of which 519 are in 10 years Tamil Nadu
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” r
Slide 11: Performance Highlights – September 2023
PERFORMANCE HIGHLIGHTS – SEPTEMBER 2023 10
Slide 12: Q2 FY 2024 Performance – A Snapshot
Q2 FY 2024 PERFORMANCE – A SNAPSHOT • Deposits increased by 6% from Rs.499 Bn to Rs.527 Bn Y-o-Y • Advances registered a growth of 2% from Rs.427 Bn to Rs.437 Bn Y-o-Y and by 3% from Rs.424 Bn in Q1 FY 24 • The total business grew by 4% from Rs.926 Bn to Rs.964 Bn Y-o-Y Y • Profitability and efficie
Slide 13: Q2 FY 24 vs Q2 FY 23 Performance – A Snapshot
Q2 FY 24 VS Q2 FY 23 PERFORMANCE – A SNAPSHOT (in INR Mn) 527,140 436,881 964,021 155,903 6% 2% 4% 498,776 427,016 925,792 156,094 Deposits Advances Total Business CASA 3,886 2,806 5,384 46.34% 1% % 4,565 2,765 5,679 38.43 % Gross Profit Net Profit Net Interest Cost to Income Income 1.69% 14.36% 3.7
Slide 14: H1 FY 24 vs H1 FY 23 Performance – A Snapshot
H1 FY 24 VS H1 FY 23 PERFORMANCE – A SNAPSHOT (in INR Mn) 527,140 436,881 964,021 155,903 6% 2% 4% 498,776 427,016 925,792 156,094 Deposits Advances Total Business CASA 8,009 5,079 10,610 44.17% 1% % 9,036 5,016 10,928 39.10 % Gross Profit Net Profit Net Interest Cost to Income Income 1.54% 13.26 %
Slide 15: FY 23 vs FY 22 Performance – A Snapshot
FY 23 VS FY 22 PERFORMANCE – A SNAPSHOT (in INR Mn) 523,979 439,708 963,687 156,569 10% 7% 8% 1% 476,897 411,560 888,457 155,294 Deposits Advances Total Business CASA 18,180 9,375 21,628 38.85% 14% 23% 13% % 15,953 7,602 19,165 40.37 % Gross Profit Net Profit Net Interest Cost to Income Income 1.46%
Slide 16: Financial Performance & Business Profile
FINANCIAL PERFORMANCE & BUSINESS PROFILE 15
Slide 17: Q2 FY 24 vs Q2 FY 23 Performance – Financial Performance
Q2 FY 24 VS Q2 FY 23 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q2 FY 24 Q2 FY 23 INC / (DEC) Growth Growth % Q1 FY 24 Deposits 527,140 498,776 28,364 6% 516,548 Advances 436,881 427,016 9,865 2% 424,048 Total Business 964,021 925,792 38,229 4% 940,596 Demand Deposits 45,
Slide 18: Q2 FY 24 vs Q2 FY 23 Performance – Income and Profit
Q2 FY 24 VS Q2 FY 23 PERFORMANCE - A SNAPSHOT FINANCIAL PERFORMANCE (in INR Mn) PARTICULARS Q2 FY 24 Q2 FY 23 INC / (DEC) Growth % Q1 FY 24 Net Interest Income 5,384 5,679 -295 -5% 5,226 Other Income 1,821 1,735 86 5% 1,915 Operating Expenses 3,339 2,849 490 17% 2,998 Gross Profit 3,866 4,565 -699 -
Slide 19: H1 FY 24 vs H1 FY 23 Performance
H1 FY 24 VS H1 FY 23 PERFORMANCE - A SNAPSHOT FINANCIAL PERFORMANCE (in INR Mn) PARTICULARS H1 FY 24 H1 FY 23 INC / (DEC) Growth % Net Interest Income 10,609 10,928 -319 -3% Other Income 3,736 3,910 -174 -4% Operating Expenses 6,336 5,802 534 9% Gross Profit 8,009 9,036 -1,027 -11% Provisions & Cont
Slide 20: FY 23 vs FY 22 Performance – Financial Performance
FY 23 VS FY 22 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS FY 2023 FY 2022 INC / (DEC) Growth Growth % Deposits 523,979 476,897 47,082 10% Advances 439,708 411,560 28,148 7% Total Business 963,687 888,457 75,230 8% Demand Deposits 47,637 46,193 1,444 3% Saving Deposits 108
Slide 21: FY 23 vs FY 22 Performance – Income and Profit
FY 23 VS FY 22 PERFORMANCE - A SNAPSHOT FINANCIAL PERFORMANCE (in INR Mn) PARTICULARS FY 23 FY 22 INC / (DEC) Growth % Net Interest Income 21,628 19,165 2,463 13% Other Income 8,104 7,591 513 7% Operating Expenses 11,552 10,803 749 7% Gross Profit 18,180 15,953 2,227 14% Provisions & Contingencies 8
Slide 22: Provisions & Contingencies – Breakup
PROVISIONS & CONTINGENCIES – BREAKUP (in INR Mn) PARTICULARS Q2 FY 24 Q2 FY 23 H1 FY 24 H1 FY 23 FY 22-23 Provision for: - Tax 500 750 850 1,450 2,400 - Bad Debts 280 1,050 2,680 2,450 6,900 - Contingency 300 - -350 120 -175 - Standard Assets -30 - -210 - -200 - Restructuring 10 - -40 - -120 Total 1
Slide 23: Q2 FY 24 vs Q2 FY 23 – Income and Expenses Breakup
Q2 FY 24 VS Q2 FY 23 – INCOME AND EXPENSES BREAKUP INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP (in INR Mn) PARTICULARS Q2 FY 24 Q2 FY 23 Growth % PARTICULARS Q2 FY 24 Q2 FY 23 Growth % Interest on Loans 10,280 9,553 8% Int Exp on Deposits 7,179 5,528 30% Interest on Investments 2,393 2,134 12%
Slide 24: H1 FY 24 vs H1 FY 23 – Income and Expenses Breakup
H1 FY 24 VS H1 FY 23 – INCOME AND EXPENSES BREAKUP INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP (in INR Mn) PARTICULARS H1 FY 24 H1 FY 23 Growth % PARTICULARS H1 FY 24 H1 FY 23 Growth % Interest on Loans 20,369 18,751 10% Int Exp on Deposits 14,020 10,722 31% Interest on Investments 4,606 4,029
Slide 25: FY 23 vs FY 22 – Income and Expenses Breakup
FY 23 VS FY 22 – INCOME AND EXPENSES BREAKUP INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP (in INR Mn) FY FY FY FY PARTICULARS Growth % PARTICULARS Growth % 2023 2022 2023 2022 Interest on Loans 38,009 34,540 10% Int Exp on Deposits 22,805 21,197 8% Interest on Investments 8,351 6,305 32% Other
Slide 26: Deposits and Advances Growth – Over the Years
DEPOSITS AND ADVANCES GROWTH – OVER THE YEARS DEPOSITS ADVANCES (in INR Mn) 5,23,979 5,16,548 5,27,140 4,39,708 4,36,881 4,76,897 4,11,560 4,24,048 4,45,370 3,70,206 4,08,325 3,45,762 31-3-2020 31-3-2021 31-3-2022 31-3-2023 30-6-2023 30-9-2023 31-3-2020 31-3-2021 31-3-2022 31-3-2023 30-6-2023 30-9-2
Slide 27: Income Growth Over the Years
INCOME GROWTH OVER THE YEARS… (in INR Mn) NET INTEREST INCOME OTHER INCOME 8,104 21,628 7,591 19,165 6,799 6,887 18,297 16,752 (6 M) (6 M) 10,609 3,736 31-MAR-2020 31-MAR-2021 31-MAR-2022 31-MAR-2023 30-SEP-2023 31-MAR-2020 31-MAR-2021 31-MAR-2022 31-MAR-2023 30-SEP-2023 CEB NET PROFIT 9,375 3,338 7
Slide 28: Key Business Indicators
KEY BUSINESS INDICATORS PARTICULARS Q2 FY 24 Q2 FY 23 H1 FY 24 H1 FY 23 Q1 FY 24 FY 22-23 Cost of Deposits 5.51% 4.51% 5.44% 4.47% 5.36% 4.66% Yield on Advances 9.77% 9.39% 9.65% 9.22% 9.53% 9.23% Yield on Investments 6.28% 5.86% 6.19% 5.84% 6.10% 5.89% Net Interest Margin 3.74% 4.09% 3.70% 4.02% 3.
Slide 29: Key Business Ratios – Yearly Trends
KEY BUSINESS RATIOS – YEARLY TRENDS NET INTEREST MARGIN RETURN ON ASSETS 5.00% 1.70% 1.69% 1.60% 4.50% 1.46% 1.50% 1.40% 1.40% 1.35% 3.98% 4.00% 3.98% 3.89% 4.00% 3.74% 1.30% 3.67% 1.15% 1.20% 3.50% 1.10% 1.00% 1.00% 3.00% 0.90% 31-MAR-20 31-MAR-21 31-MAR-22 31-MAR-23 30-JUN-23 30-SEP-23 31-MAR-20 3
Slide 30: Cost of Deposits & Yield on Advances
COST OF DEPOSITS & YIELD ON ADVANCES (in %) 16 14 13.43 13.18 12.83 12.10 12 11.46 10.95 10.76 9.91 9.65 10 9.36 9.23 8.37 8.15 7.62 8 6.82 6.29 6.17 6.20 6 5.36 5.44 4.68 4.66 4 2 0 Mar 14 Mar 15 Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Mar 21 Mar 22 Mar 23 Sep 23 Spread between cost of deposits and yiel
Slide 31: Loan Book – Products Composition
LOAN BOOK – PRODUCTS COMPOSITION % toTotal Advances Trading & MSME loans constitute about 48% 1% Bills Purchased & Diversified credit portfolio reduces credit risk and Lower Bills Discounted ticket size backed by adequate collaterals Term Loan 35% Cash Credit & Demand Loan Unsecured Advances aggrega
Slide 32: Loan Book Sectoral Deployment – Position as on 30.09.2023
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 30.09.2023 (in INR Mn) Loans collateralized by Deposits 7,138 Retail Traders Large Industries Personal Loans 8,860 6,857 10,105 NBFC 1% Infrastructure 11,663 2% 2% 2,676 Wholesale Traders 3% 15,654 4% Housing Loan 20,232 5% Others 6% 42% 24,135 SECTORAL
Slide 33: 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 September 2023 TEXTILE a) Cotton 19,749 (5%) b) Other Textiles 26,470 (6%) METALS a) Iron & Steel 10,802 (2%) Amount % to Total Industry Name b) Other Metals 9,153 (2%) (in INR Mn) Advanc
Slide 34: Gold Loan Book – Q2 FY 24
GOLD LOAN BOOK – Q2 FY 24 (in INR Mn) GOLD LOAN PORTFOLIO Sep-22 Mar-23 23 Jun-23 Sep-23 Gold Loan – Agriculture 62,250 69,631 64,774 60,639 Gold Loan – Non-Agriculture 38,185 40,641 43,031 48,159 Total Gold Loans 100,435 110,272 107,805 108,798 Gross Advances 427,016 439,708 424,048 436,881 % of Go
Slide 35: Asset Quality
ASSET QUALITY (in INR Mn) GROSS NPA QTM & GROSS NPA % NET NPA QTM & NET NPA % 5.11% 11,911 4.91% 4.70% 10,752 4.66% 10,176 10,386 9,987 4.37% 4.09% 20,811 7,785 20,346 18,932 19,332 19,202 14,134 2.97% 2.95% 2.36% 2.51% 2.34% 2.29% 31-Mar-20 31-Mar-21 31-Mar-22 31-Mar-23 30-Jun-23 30-Sep-23 31-Mar-2
Slide 36: Asset Quality Position – Movement Over the Years
ASSET QUALITY POSITION – MOVEMENT OVER THE YEARS (In INR MN) FY MAR-19 FY MAR-20 MAR FY MAR-21 FY MAR-22 FY MAR-23 Q2 FY 24 H1 FY 24 NPA Opening balance 8,565 9,771 14,134 18,932 19,332 20,811 19,202 Additions A 6,322 11,104 11,131 12,757 13,290 2,247 6,069 Recovery made 1,980 1,644 1,950 4,424 5,76
Slide 37: Restructured Accounts
RESTRUCTURED ACCOUNTS Quarter wise balance outstanding in respect of Restructured Standard borrowers (In INR Mn) Sep-21 Mar-22 Sep-22 Mar-23 Sep-23 Type of Restructuring No. of No. of No. of No. of No. of Amt Amt Amt Amt Amt Borrowers Borrowers Borrowers Borrowers Borrowers MSME 333 15,398 395 15,03
Slide 38: Security Receipts
SECURITY RECEIPTS 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 Sep-22 804 Dec-22 12 Mar-23 12 Jun-23 319 Sep-23 313 In Q3 FY 23, we we had written off SRs which had crossed the 8 year time limit to the tune of Rs.792
Slide 39: Investments – At a Glance
INVESTMENTS – AT A GLANCE Investments Breakup and Category wise (in INR Mn) Particulars Sep 2023 Sep 2022 SLR Securities 155,826 146,275 Non-SLR Securities 1,245 1,623 Total Investments 157,071 147,898 Yield on Investments 6.19% 5.84% Investments Breakup: -A FS 39,664 (25%) 33,426 (23%) - HTM 117,40
Slide 40: Digital Initiatives
DIGITAL INITIATIVES 39 39
Slide 41: Product launch at Global Fintech Fest 2023
Product launch at Global Fintech Fest 2023 “Your voice is your password” Hello! UPI - Conversational Aadhaar based PIN Payment generation for UPI 123pay Conversational payments CUB RuPay SELECT Using Alexa* * Under Beta Debit Card 40
Slide 42: New products Launched
New products Launched Soft launch of Digital e-BG Lending - Instant Loans Issuing Electronic Bank Loan Against MSME Property Up to 3Cr Guarantee (e-BG) for our Retail & Corporate Banking Housing Loan Customers and corporate 41
Slide 43: API Banking – Strategic Partnerships
Strategic Partnerships Account Digital Opening Lending Payments API BANKING Correspondent Customer Banking Digital Onboarding Insurance 42
Slide 44: Awards Received During 2023-24
Awards Received During 2023-24 @ The Economics Times DataCon Awards 2023 at IBS awards by Synnex Indian Banking Sumit & Awards 2023 Second Best Bank all over CUB's Angamaly Branch adjudged the Digital Transformation Digital Bank India among other than Large third-best branch in Kerala among old gen
Slide 45: Branch Network
BRANCH NETWORK 44
Slide 46: Pan India Presence with Strong Foothold in the South
PAN INDIA PRESENCE WITH STRONG FOOTHOLD IN THE SOUTH No. of % of % of % of STATE Branches Deposits Advances Business TAMILNADU 519 81% 66% 74% ANDHRAPRADESH 49 2% 7% 5% KARNATAKA 41 6% 5% 5% TELENGANA 36 3% 6% 4% MAHARASHTRA 20 3% 3% 3% GUJARAT 20 1% 3% 2% KERALA 18 1% 2% 2% OTHERS 49 3% 8% 5% TOTAL
Slide 47: Shareholding Pattern
SHAREHOLDING PATTERN 46
Slide 48: A Well Diversified Investor Base
A WELL DIVERSIFIED INVESTOR BASE Position as on 30-Sep-2023 Major Institutional Shareholders SHAREHOLDERS* HOLDING % QIB, NRI, HDFC ASSET MANAGEMENT ** 6.85 6.70 1.19 CAPITAL RESEARCH & MANAGEMENT, USA # 6.76 FRANKLIN TEMPLETON INVESTMENT FUND 4.81 Corp Bodies, Others, SBI MUTUAL FUND ** 4.42 2.12 2
Slide 49: Corporate Governance
CORPORATE GOVERNANCE 48
Slide 50: 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 51: 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 52: Contact
Contact Regd. Office : 149,TSR Big Street, Kumbakonam – 612001,Tamilandu. Admin Office : "Narayana" No.24 B, Gandhi Nagar, Kumbakonam - 612001,Tamil Nadu. Tel : 0435-2402322,2401622,| FAX: 0435-2431746 0435 | www.cityunionbank.com INVESTOR CONTACT Name :K.Jayaraman,GM Mob : +91 9344303740 Locate us