Rbl Bank Ltd. · NSE:RBLBANK
Rbl Bank — Q2 FY20 Earnings Presentation
57 slides from Rbl Bank's earnings presentation, Oct 22, 2019
Slide 1: Investor Presentation: 2nd Quarter/Half Year FY20
Investor Presentation 2nd Quarter/ Half Year FY 20 Oct 22, 2019
Slide 2: Disclaimer
Disclaimer By attending the meeting / telephonic call where this presentation is made, or by reading the presentation materials, you agree to be bound by the following limitations: The information in this presentation has been prepared by RBL Bank Limited (the “Company”) for use in presentations by
Slide 3: Glossary and Key Notes
Glossary and Key Notes AEPS Aadhaar Enabled Payment System INR Indian Rupee Agri Agribusiness Banking IPO Initial Public Offering API Application Programming Interface LAP Loan Against Property ARC Asset Reconstruction Company MF Mutual Funds ATM Automated Teller Machine Mn Million BC Business Corre
Slide 4: Table of Contents
Table of Contents Topic Page Number Key Performance Highlights 5 RBL Vision 2020 12 Financial Performance 16 Distribution Network 33 Shareholding Pattern and Ratings 35 Micro-banking Update 37 Credit Cards Update 42 Annexures 47 4
Slide 5: Key Performance Highlights
Key Performance Highlights
Slide 6: Q2/H1 FY20 Financial Highlights
Q2/ H1 FY20 Financial Highlights Q2/ H1 FY20 continues to track well to business drivers, Profitability impacted by short term challenges Total Revenue growth in Q2 FY20 of 41% YOY (H1 FY20 of 45% YoY) NII growth of 47% YoY in Q2 FY20 (H1 FY20 growth of 47% YOY); Other Income growth of 33% YoY in Q2
Slide 7: Q2 FY20 Highlights
Q2 FY20 Highlights YoY Growth QoQ Growth Net interest Income Rs. 869cr 47% 6% Core Fee Income Rs. 388cr 19% (6%) Net Total Income Rs. 1,310cr 41% 1% Operating Profit Rs. 636cr 42% 3% Net Profit Rs. 54cr (73%) (80%) 7
Slide 8: Half Year FY20 Highlights
Half Year FY20 Highlights YoY Growth Net interest Income Rs. 1,686cr 47% Core Fee Income Rs. 799cr 30% Net Total Income Rs. 2,609cr 45% Operating Profit Rs. 1,255cr 42% Net Profit Rs. 321cr (19%) 8
Slide 9: Q2 FY20 Highlights Contd....
Q2 FY20 Highlights Contd…. YoY Growth QoQ Growth Advances Rs. 58,476cr 27% 3% Wholesale Rs. 30,471cr 12% (1%) Advances Non-Wholesale Rs. 28,005cr 49% 7% Advances Deposits Rs. 62,829cr 31% 3% CASA Rs. 16,620cr 42% 6% 9
Slide 10: Key Indicators
Key Indicators Pre-IPO Advances Deposits Net Profit RoA BVPS FY 11 1,905 2,042 12 0.5% Rs. 50 FY 16 21,229 24,349 292 1.0% Rs. 91 (84% CAGR FY 11-16) (64% CAGR FY 11-16) (88% CAGR FY 11-16) Post Listing Performance Advances YoY NIM Net Profit RoA Q3 FY17 26,773 46% 3.4% 129 1.17% Q4 FY17 29,449 39%
Slide 11: Key Indicators – Business Breakup
Key Indicators – Business Breakup Advances by Segment (%) Deposit Breakup (%) 13.5% 10.4% 37.9% 16.1% 34.4% 73.5% 14.2% Term Deposits Saving Deposits CIB CB Retail Assets DB&FI Current Deposits 11
Slide 12: RBL Vision 2020
RBL Vision 2020 ‘te
Slide 13: Performance to Vision 2020 Goals
Performance to Vision 2020 Goals RBL Vision 2020 Actual Q2 FY20 (Post IPO/Sept 2016) CAGR since Q2 FY17: 33% Advances 30-35% CAGR Q2 FY20 : 27% FY 16: 18.6%; FY 17: 22.0%; 0.75 - 1% increase CASA Ratio FY 18: 24.3%; FY 19: 25.0%; every year Q2 FY20: 26.5% Other Income % ~ 1/3rd of Net Total Income 3
Slide 14: Key Initiatives of Vision 2020
Key Initiatives of Vision 2020 Leveraging technology to acquire, engage and service clients API banking, Abacus (Digital savings account); Fintech Partnerships (Moneytap, Technology Zeta) ; Credit card partnerships (Bajaj Finserv, BookMyShow, ET Money) Enhancing distribution through a combination of
Slide 15: Our Fundamentals Have Resulted in Consistent Strong Performance
Our Fundamentals Have Resulted in Consistent Strong Performance Key Pillars Robust corporate governance framework and processes Broad Based Shareholder and Strong Capital Base Professional and experienced management team Eminent Board of Directors 15
Slide 16: Financial Performance
Financial Performance 16
Slide 17: Strong Operating Profit Momentum Continues; Accelerated Provisioning Impacts Net Profit
Strong Operating Profit Momentum Continues; Accelerated Provisioning Impacts Net Profit Parameter Q2 FY20 Q2 FY19 YoY Q1 FY20 QoQ H1 FY20 H1 FY19 Net Interest Income 869 593 47% 817 6% 1,686 1,146 Other Income 442 333 33% 481 (8%) 923 659 Net Total Income 1,310 926 41% 1,299 1% 2,609 1,805 Operating
Slide 18: Strong Growth in Business and CASA Continues
Strong Growth in Business and CASA Continues Parameter Sep 30,2019 Sep 30,2018 YoY Advances 58,476 45,873 27% Deposits 62,829 47,790 31% Investments 19,778 13,749 44% Parameter Sep 30,2019 Sep 30,2018 June 30,2019 CASA 26.5% 24.5% 25.8% GNPA 2.60% 1.40% 1.38% NNPA 1.56% 0.74% 0.65% Net Stressed Asse
Slide 19: Well Diversified Other Income Profile; Cards Driving Core Fee Income
Well Diversified Other Income Profile; Cards Driving Core Fee Income Other Income Core Fee Income Breakup 923 799 13% 9% 659 614 388 411 8% 441 481 7% 9% 9% 333 325 52% 15% 12% 40% 8% 87% 57% 2% 47% 40% 4% 3% 88% 93% 2% 13% 10% 85% 3% 12% 14% 3% 98% 9% 24% 16% 19% 23% 12% 11% 10% 12% 10% 12% Q2 FY19
Slide 20: Cost Growth Driven by Business Expansion; Credit Costs due to Increased Provisions
Cost Growth Driven by Business Expansion; Credit Costs due to Increased Provisions Operating Expenses Net Credit Cost by Business (bps) 26* 35* 93* 51* 129* 1,354 64 60 680 674 923 46 60% 477 53% 59% 26 61% 24 5% 22 54% 6% 7% 16 5% 14 5% 8% 12 6% 7% 7% 28% 9 9 8% 33% 6 7 4 29% 2 4 3 32% 27% 3 2 1 Q2
Slide 21: Changing Advances Mix and Improving Yields Helping NIMs
Changing Advances Mix and Improving Yields Helping NIMs Yield Sep 30,2019 Sep 30,2018 YoY Proportion H1 20 C&IB 22,143 18,826 18% 9.2% CB 8,328 8,303 0% (8.6%) 52% Wholesale 30,471 27,129 12% Retail Assets 20,138 12,407 62% LAP 7,295 4,532 61% Credit Cards 8,003 3,613 121% Retail Agri 1,470 1,541 (5
Slide 22: Diversified Loan Portfolio
Diversified Loan Portfolio Break up of advances - Tenor of Advances Secured/Unsecured 58,476 58,476 56,837 56,837 6% 9% 7% 10% 45,873 42,198 8% 27% 29% 7% 9% 8% 18% 8% 20% 23% 21% 64% 65% 66% 68% 63% 64% Sep 30, 2018 June 30, 2019 Sep 30, 2019 Sep 30, 2018 June 30, 2019 Sep 30, 2019 Secured Unsecure
Slide 23: Borrowers' External Rating Profile
Borrowers’ External Rating Profile* Sep 30, 2018 June 30, 2019 Sep 30, 2019 3.8% 6.5% 8.7% 25.3% 27.1% 27.4% 38.4% 33.9% 33.7% 26.7% 27.1% 24.0% 5.9% 5.4% 6.0% External Ratings External Ratings External Ratings AAA AA- & Above A- & Above BBB- & Above BB+ & Below * Based on standard exposures; Unrate
Slide 24: Diversified Industry Mix
Diversified Industry Mix Top 10 Industry* Outstanding % of Outstanding FB+NFB Industry FB-NFB Split FB+NFB Exposure Exposure NBFC (ex. HFC & DFI) 4,029 99:1 5.3% Construction 3,956 33:67 5.2% Engineering 3,551 35:65 4.6% Retail/ Distribution 2,965 76:24 3.9% Real Estate 2,500 92:8 3.3% Power 2,436 7
Slide 25: Specific Asset Disclosures
Specific Asset Disclosures • Increased stress in the economy and deterioration in the credit environment has had an impact on us, more than we initially anticipated • As a result, we expect the total stressed / NPA is conservatively approx. Rs. 1,800 crore. This includes the 4 groups (East based gro
Slide 26: Exposures to Specific Sectors
Exposures to Specific Sectors • Total outstanding of the real estate sector is approx. Rs. 2,500 crore , fully secured • This exposure is to 44 accounts with an average ticket size of Rs. 57 crore • There is no case in SMA 1 or SMA 2 in this portfolio • Average maturity of between 1-2 years • Total
Slide 27: Asset Quality Impacted by Stress in Select Accounts
Asset Quality Impacted by Stress in Select Accounts Gross NPA by business segment Quarter Ended Business segment Sep June Sep Sep June Sep 30,2019 30,2019 30,2018 30,2019 30,2019 30,2018 Movement of Gross NPAs C&IB 842.4 139.5 92.1 Opening Balance 789 755 596 % of total advances 1.43% 0.24% 0.20% (+
Slide 28: Capital Adequacy - Well Capitalized to Support Growth
Capital Adequacy - Well Capitalized to Support Growth Particulars Sep 30, 2019 Sep 30, 2018 June 30, 2019 Tier 1 Capital Funds* 7,542 6,969 7,443 Tier 2 Capital Funds 685 712 719 Total Capital Funds 8,227 7,681 8,162 Total RWA 66,976 55,867 65,740 Tier 1 CRAR* 11.3% 12.5% 11.3% Total CRAR* 12.3% 13.
Slide 29: CASA Growth Driving Overall Deposit Growth
CASA Growth Driving Overall Deposit Growth 42% yoy growth in CASA, while total deposits grew by 31% CASA : 24.5% CASA : 25.8% CASA : 26.5% CASA : 11,712 CASA : 15,706 CASA : 16,620 60,811 62,829 9.3% 10.4% 47,790 16.5% 16.1% 11.9% 12.6% 74.2% 73.5% 75.5% Sep 30, 2018 June 30, 2019 Sep 30, 2019 Term
Slide 30: Diversified Borrowing Streams
Diversified Borrowing Streams Borrowing Breakup 13,953 12,284 5% 4% 6% 3% 9,610 40% 35% 8% 1% 53% 56% 51% 38% Sep 30, 2018 June 30, 2019 Sep 30, 2019 Refinance FCY Inter-bank CBLO/LAF Tier II 30
Slide 31: Steady Investment Book
Steady Investment Book Investment Breakup 19,778 16,639 3% 5% 13,749 5% 10% 6% 11% 4% 12% 9% 12% 77% 82% 76% Sep 30, 2018 June 30, 2019 Sep 30, 2019 G-Sec Debentures & Bonds Money Market /Equities/MF Others Yield Yield Q2 FY20 Q2 FY19 Q1 FY20 H1 FY20 H1 FY19 Total Investments 7.6% 7.4% 7.6% 7.6% 7.3
Slide 32: NIM Improvement Helped by Higher Yields due to Changing Mix
NIM Improvement Helped by Higher Yields due to Changing Mix Pre-IPO FY 11 FY 12 FY 13 FY 14 FY 15 FY 16 Yield on Advances 10.9% 12.6% 13.1% 12.9% 12.3% 11.7% Cost of Funds 5.8% 8.3% 9.6% 9.4% 8.4% 7.6% Cost of Deposits 5.8% 8.1% 8.9% 8.8% 8.3% 7.7% Post Listing Performance Q1 FY18 Q2 FY18 Q3 FY18 Q4
Slide 33: Distribution Network
Distribution Network 33
Slide 34: Our Growing, Multi-Layered Distribution Network
Our Growing, Multi-Layered Distribution Network Locations Customers (Mn.) Chandigarh 3 6.51 6.92 7.32 5.33 5.82 GIFT 30 2 city 10 New Delhi branch September December March 31, June 30, September 12 30, 2018 31, 2018 2019 2019 30, 2019 10 6 Channel Breakup 2 Channels Number of transaction points 26 1
Slide 35: Shareholding Pattern & Ratings
Shareholding Pattern & Ratings 35
Slide 36: Diversified Shareholding & Strong/Improving Rating Profile
Diversified Shareholding & Strong/Improving Rating Profile Shareholding by category (%) Ratings Instrument Rating 1.6 1.9 Basel III compliant Tier II ICRA AA- hyb (Stable) 10.4 bonds CARE AA- (Stable) 27.5 (Re-affirmed dated Oct 3, 2019) 18.6 Certificate of Deposits ICRA A1+ 17.6 22.5 Medium term fi
Slide 37: Micro-banking Update
Micro-banking Update 37
Slide 38: Micro-banking Distribution Network
Micro-banking Distribution Network • 133 BC branches opened in H1 FY20 (117 branches in Q2) State Name % of Portfolio % of Portfolio • 63 RBL Finserve branches opened in H1 FY20 (57 branches in Q2 FY20) Sept’19 Mar’19 • 238 Banking Outlets Tamil Nadu 13.80% 14.60% Bihar 13.30% 14.40% Maharashtra 11.
Slide 39: Micro-banking - Portfolio Highlights
Micro-banking - Portfolio Highlights Loan Book Portfolio Mix Sept 30th 2019 In Rs. crores 31% 41% RBL Finserve & 55% Direct 65% 5,151 Other BCs 45% 5,028 3,560 3,917 2,161 2.65 Mn active loan accounts Mar 31,2017 Mar 31,2018 Mar 31,2019 Sept 30,2018 Sept 30,2019 Quarter on Quarter Disbursement Top 3
Slide 40: Micro-banking - Through the door Mix
Micro-banking - Through the door Mix Bureau Rejection Rate Borrowing Cycle with RBL Bank 21% 21% 23% 26% 31% 33% 29% 30% 79% 79% 77% 74% 28% 26% 69% Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY 20 Q2 FY19 Q3 FY19 Q4 FY19 Q1FY20 Q2FY20 First Cycle Repeat Cycle Bureau Hit Rate* Loan Tenor 1.3% 82% 82% 36.6%
Slide 41: Micro-banking – Average Ticket Size Below Industry
Micro-banking – Average Ticket Size Below Industry Gradual ticket size increase ~ 14% over 2 years. Market ticket sizes have grown faster and are more – both for industry and peers. Peers : Two largest banks, two prominent SFB’s and two large MFI’s Source : Equifax 90 – 179 dpd – RBL vs Industry Loa
Slide 42: Credit Card Update
Credit Card Update 42
Slide 43: Credit Card Base Increasing Steadily
Credit Card Base Increasing Steadily Cards in Force ( In Mn) Card Additions ( In Mn) 2.29 2.02 0.39 0.38 1.71 0.31 0.34 1.43 0.26 1.19 0.21 0.97 0.20 0.80 Mar Jun Sep Dec Mar Jun Sep Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 31,2018 30,2018 30,2018 31,2018 31,2019 30,2019 30,2019 Advances Breakup (I
Slide 44: Credit Cards - Sticky Customer Spends
Credit Cards - Sticky Customer Spends Total Spends (In Rs Crore) Consumer Loans 20.79 20.09 18.6 20.79 19.39 19.19 19.0 1,760 7,035 1,435 5,936 1,186 4,712 4,403 1,024 4,208 850 790 755 3,234 636 2,378 544 512 412 382 285 214 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1
Slide 45: Credit Cards – Stable Revolving Balances
Credit Cards – Stable Revolving Balances RBL - Revolve Rate Revolve rate stable and maintained 47.18% 45.84% between 44%- 46% - the ideal balance in 45.45% terms of generating revenue while keeping 44.23% the risk in check. Note : Revolve rate is measured as total balances of customers (including te
Slide 46: Credit Cards – Delinquency Trends Better Than Industry
Credit Cards – Delinquency Trends Better Than Industry 6 MOB $30+ rate – RBL vs Industry Early delinquency trends for new 6.0% acquisition at 6 MOB (months on book) 5.0% 4.0% 4.6% Consistently maintained below industry 3.0% cohort. This is on account of active 2.0% 3.1% “steering wheel” approach inv
Slide 47: Annexures
Annexures 47
Slide 48: Board of Directors
Board of Directors Mr. Vishwavir Ahuja Mr. Prakash Chandra Managing Director and CEO Non – Executive Part Time Chairman Previously, Managing Director & Country Executive Officer of Bank Previously, Chairman of Central Board of Direct Taxes of America for Indian Sub-continent (CBDT) Mr. Sivanandhan D
Slide 49: Professional and Experienced Leadership Team
Professional and Experienced Leadership Team Mr. Vishwavir Ahuja Mr. Rajeev Ahuja Managing Director and CEO Executive Director Managing Director & Country Executive Officer of Bank of America Previously, associated with Citibank India, Bank of America, India for Indian Sub-continent from 2007-2009 a
Slide 50: Professional and Experienced Leadership Team (Contd.)
Professional and Experienced Leadership Team (Contd.) Mr. Ramnath Krishnan Mr. Pankaj Sharma Chief Risk Officer Chief Operations Officer Previously, Country Chief Risk Officer , HSBC Malaysia Berhad Previously, Head Retail Operations, Axis Bank (31) (20) Mr. Mohit Kapoor Mr. Bhavtaran Singh (Sunny)
Slide 51: Borrowers' Rating Profile
Borrowers’ Rating Profile Sep 30, 2018 June 30, 2019 Sep 30, 2019 3.3% 3.3% 2.1% 2.1% 3.6% 2.7% 11.1% 10.5% 10.2% 16.1% 15.4% 16.0% 32.6% 31.2% 33.3% 38.3% 36.6% 38.6% 47.3% 44.9% 47.5% 38.7% 39.3% 39.1% 7.0% 9.8% 6.5% 5.7% 3.0% 4.3% Internal Borrower Internal Facility Ratings Internal Borrower Inte
Slide 52: Profit & Loss Statement
Profit & Loss Statement Particulars Q2 FY20 Q2 FY19 Q1 FY20 H1 FY20 H1 FY19 Income Interest Earned 2,126 1,463 2,023 4,149 2,828 Interest Expended 1,257 870 1,205 2,463 1,682 Net Interest Income 869 593 817 1,686 1,146 Other Income 442 333 481 923 659 Total Income 1,310 926 1,299 2,609 1,805 Expendi
Slide 53: Balance Sheet Statement
Balance Sheet Statement Particulars Sep 30, 2019 June 30, 2019 Sep 30, 2018 Liabilities Capital 431 428 431 Reserves and Surplus 7,368 7,409 6,609 Deposits 62,829 60,811 47,790 Borrowings 13,953 12,284 9,610 Other Liabilities 3,096 3,113 2,716 Total 87,678 84,045 67,156 Assets Cash & Balances with R
Slide 54: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars Q2 FY20 Q2 FY19 Q1 FY20 H1 FY20 H1 FY19 Income Interest Earned 2,190 1,464 2,083 4,274 2,828 Interest Expended 1,257 870 1,205 2,463 1,681 Net Interest Income 933 594 878 1,811 1,147 Other Income 443 333 484 927 658 Total Income 1,376 926 1,362 2,738
Slide 55: Consolidated Balance Sheet Statement
Consolidated Balance Sheet Statement Particulars Sep 30, 2019 June 30, 2019 Sep 30, 2018 Liabilities Capital 431 428 431 Reserves and Surplus 7,353 7,395 6,619 Deposits 62,824 60,807 47,774 Borrowings 13,953 12,284 9,610 Other Liabilities 3,110 3,139 2,768 Total 87,671 84,053 67,202 Assets Goodwill
Slide 56: Our Recent History
Our Recent History FY 11 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 H1 Particulars FY20 Net Worth 1,075 1,131 1,594 2,012 2,224 2,960 4,242 6,544 7,336 7,610 Deposits 2,042 4,739 8,341 11,599 17,099 24,349 34,588 43,902 58,394 62,829 Advances (Net) 1,905 4,132 6,376 9,835 14,450 21,229 29,449 40
Slide 57: Thank you
Thank you Contact us at: ir@rblbank.com +91-22-4302 0600 Please email us your contact details at the above id to get added to our investor relations mailing list Please visit our Investor Relations website – https://ir.rblbank.com/ 57