South Indian Bank Limited · NSE:SOUTHBANK
South Indian Bank — Q4 FY18 Earnings Presentation
63 slides from South Indian Bank's earnings presentation, May 2018
Slide 1: Investor Presentation May 2018
Investor Presentation May - 2018
Slide 2: Safe Harbor
Safe Harbor 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. Certa
Slide 3: Contents
Contents Q4 FY18 Highlights Business Strategy Performance Matrix Next Generation Bank An Inflection Point About Us 3
Slide 4: Q4 FY18 Highlights
Z 04 FY18 Highlights © \
Slide 5: Key Highlights
Key Highlights Financial Results in line with guidance FY18 Advances growth at ~17% Retail (excluding Gold), SME and Agriculture Loan book growth at ~20% Increase of ~23% YoY in Transaction Fee and Technology income for FY18 We have ‘Zero’ accounts in our watchlist of Large Corporate Loan Book 5
Slide 6: Award Wins
Award Wins IBA Technology Awards 2018 Winner – Best Technology Bank of the Year Winner - Best Payment Initiatives Winner - Best use of Digital & Channel Technologies Runner up – Best Financial Inclusion Initiatives Runner up – Best IT Risk & Cyber Security Initiatives 6
Slide 7: Award Wins
Award Wins ASSOCHAM - Won Social Banking Excellence Award 2017 (Priority Sector Lending) 7
Slide 8: Award Wins
Award Wins FIEO Regional Export Award 2015-16 Best Financial Services & Foreign Exchange Earner in Southern Region (Gold) 8
Slide 9: Key Performance Highlights- Q4 FY18
Key Performance Highlights- Q4 FY18 CASA Rs Crs Deposits Advances Q4 FY18 17,142 Q4 FY18 72,030 Q4 FY18 55,109 Q4 FY17 15,746 Q4 FY17 66,117 Q4 FY17 47,084 9% 9% 17% Net Interest Income Other Income Q4 FY18 492 Q4 FY18 179 Q4 FY17 439 Q4 FY17 138 12% 30% PPOP PAT Q4 FY18 Q4 FY18 114 311 Q4 FY17 281
Slide 10: Business Strategy
ayy Business Strategy aI: 10
Slide 11: Our Strategy…
Our Strategy… • Focus on retail loan products Expand • Efficient branches for faster processing of loans Retail • Continuous training of work force Business • Advanced technology for ease of customers • Invest in Brand Building • Cluster based approach in industry hubs Strengthen SME Base • Sole Ban
Slide 12: …Performance in Line with Strategy
…Performance in Line with Strategy Expand Retail, SME & Strengthen SME Base Improve CASA Agriculture Business Rs. 33,314 Crs Rs. 12,965 Crs Rs. 17,142 Crs INCREASE INCREASE INCREASE 20% YoY 18% YoY 9% YoY Enhance Asset Quality Improve share of other (Restructured Book) Income in FY18 Rs. 297 Crs Rs.
Slide 13: Shall continue to focus on Core Strengths
Shall continue to focus on Core Strengths 01 Increase … 02 Retail Business … 03 SME Business … CASA More Products Sole Banker Retail SME Relationships Relationships 06 Sustainable… 05 Increase… 04 Improve Asset Quality Fee Income NIM 13
Slide 14: ...Increase Retail & SME Business
...Increase Retail & SME Business 01 02 03 Centralized Retail Hub Marketing & • Home Loan Cluster Processing • Auto Loan Branches • MSME Loan Centre (Kochi) • LAP Loan Processing Retail Business Branch Profitability • Enhanced risk management • Penetrate further in the • Focus on particular existing
Slide 15: …by focus on Housing Loans in Retail
…by focus on Housing Loans in Retail Retail Breakup Housing: Key Initiatives Rs Crs 13,787 • Retail hub in Kochi to increase focus 13,027 on housing finance 12,234 1,543 12,002 1,422 11,566 1,045 • Dedicated Officers for marketing 1,369 1,436 1,329 1,008 Retail Loans 986 1,047 801 3,826 • Marketing
Slide 16: …becoming a Banker of Choice to SMEs
…becoming a Banker of Choice to SMEs Average SME Loan / Account SME Loan Book by Geography – Q4 FY18 Rs Lakhs Rest of India 26.50 25% Kerala 43% 23.50 21.25 South (Ex- 19.69 Kerala) 17.66 32% SME Highlights • Dedicated JGM appointed to ensure focus and better coordination with regions • Focused ‘Gre
Slide 17: …with the help of our Branch Network
…with the help of our Branch Network Total Branch Network +3.0% 794 822 834 850 854 738 FY13 FY14 FY15 FY16 FY17 FY18 Total ATM Network +11.6% No of 1,382 Branch Location* 1,287 1,320 Branches 1,200 1,000 Kerala 464 800 South India (Ex-Kerala) 248 Rest of India 142 Total 854 FY13 FY14 FY15 FY16 FY17
Slide 18: … and our Experienced Employees
… and our Experienced Employees Employee Addition Total Employees: 7,287* 83 7,287 6,977 191 77 279 9% 3% 25% 29% 34% Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Closing < 1 Year 1-2 Years 2-5 Years 5-10 Years > 10 Years *Full-time officers and clerks. 18
Slide 19: Performance Matrix
ayy Performance Matrix 19
Slide 20: Strong Deposit Franchise
Strong Deposit Franchise Core & Non-Core Deposits Rs Crs Mar-18 Mar-18 Mar-18 57,469 14,561 72,030 6% 22% 9% 54,216 11,902 66,117 Mar-17 Mar-17 Mar-17 Core Deposit Non-Core Deposit Total Deposit CASA Deposits Mar-18 Mar-18 Mar-18 Rs Crs 3,058 14,084 17,142 11% 8% 9% 2,753 12,994 15,747 Mar-17 Mar-17
Slide 21: Core Deposits Growing...
Core Deposits Growing... Breakup of Deposits CASA Deposit Rs Crs Rs Crs 72,030 +9% 67,142 68,109 17,142 66,117 65,791 15,747 2,753 3,058 12,994 14,084 40,408 38,498 39,618 39,746 39,162 Mar-17 Mar-18 Current Savings Term Deposits 14,084 Rs Crs 12,994 13,526 13,799 +5% 13,522 3,058 38,498 40,408 2,75
Slide 22: NRI Deposits Growing…
NRI Deposits Growing… NRI Deposits CASA Rs Crs In (%) 18,375 18,855 17,389 17,850 16,821 25.2 24.6 24.9 23.8 23.8 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 22
Slide 23: Break Up of Non Resident Deposits
Break Up of Non Resident Deposits Deposit Type (Rs Crs) Q4-FY 17 Q1-FY 18 Q2-FY 18 Q3-FY 18 Q4-FY 18 NRE SB 2,908 3,089 3,106 3,212 3,335 NRO SB 508 520 539 603 618 FCNR (B), RFC & Others 1,446 1,508 1,568 1,598 1,634 Low Cost NRI Deposit (Sub 4,862 5,117 5,213 5,413 5,587 Total) NRE Term Deposit 11
Slide 24: Composition of Loan Book
Composition of Loan Book Corporate Advances (Above Rs 25 Crs) Retail Advances Rs Crs Rs Crs 20,438 33,851 34,671 17,901 17,872 18,598 31,845 17,536 29,183 29,728 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Segment wise Break Up of Total Loan Book Rs Crs 7,919 , 20,438 , 14.
Slide 25: Composition of Corporate Loan Book
Composition of Corporate Loan Book 78% of Corporate Loan Book is Investment Grade 10.88% Rs Crs 29.29% 12.09% 0.5% 0.2% 0.2% 0.1% 0.0% 18.9% 18.3% 19.2% 24.7% 26.4% 2.10% 1.60% 15.9% 2.83% 19.0% 18.6% 21.2% 3.37% 24.6% 3.83% 3.65% 12.60% 32.8% 38.3% 35.0% 5.76% 4.15% 28.1% 7.85% 27.2% Financial Inte
Slide 26: Key Focus : Retail, SME & Agriculture
Key Focus : Retail, SME & Agriculture Retail excluding Gold Gold ( Average LTV – 65%) Rs Crs Rs Crs 12,430 1,321 1,361 1,320 1,328 1,357 10,914 11,699 Retail Loans (Excl. 10,245 10,641 Gold), Agriculture & SME has grown by 20% (Y-o-Y) Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sep-17 Dec-17 Ma
Slide 27: Advances growing Across Regions
Advances growing Across Regions Rs Crs 55,109 52,449 49,717 47,084 47,264 15,983 14,898 14,515 14,170 13,541 16,624 15,975 15,440 14,693 15,034 21,576 22,502 18,221 18,689 19,762 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Rest of India South Ex- Kerala Kerala 27
Slide 28: Net Interest Income - Quarter
Net Interest Income - Quarter Net Interest Income Cost of Deposits & Yield on Advances Rs Crs In % Cost Of Deposit Yeild on Advances 503 509 492 439 461 9.97 10.06 10.03 9.88 9.61 6.33 6.24 6.05 6.01 6.04 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 Net Interest Margin Cost
Slide 29: Net Interest Income - Cumulative
Net Interest Income - Cumulative Net Interest Income Cost of Deposits & Yield on Advances Rs Crs In % Cost of Deposits Yield on Advances 1,966 1,675 10.43 1,473 10.06 10.05 9.99 9.89 964 6.64 6.24 6.14 6.10 461 6.08 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar -17 Jun -17 Sept -17 Dec -17 Mar -18 Net Inte
Slide 30: Improving Operating Efficiency
Improving Operating Efficiency Employee Additions C/I Ratio In % 279 191 49.20 47.17 45.12 44.19 42.63 -6 -77 Mar -17 Jun -17 Sept -17 Dec-83 -17 Mar -18 Mar -17 Jun -17 Sept -17 Dec -17 Mar -18 Business per Employee Business per Branch Rs Crs Rs Crs 14.3 14.1 14.5 14.9 129 130 132 134 13.8 120 Mar-
Slide 31: Sustainable Other Income
Sustainable Other Income Total Other Income led by …. …Sustainable : Transaction Fees + Technology Rs Crs Rs Crs 280 98 100 94 86 84 219 179 159 64 67 69 138 59 54 27 30 29 31 31 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Transaction Fees Technology Profit on Sale of Inves
Slide 32: Break Up of Provisions
Break Up of Provisions Rs Crs Q4-FY 18 Q4-FY 17 Q3-FY 18 For NPA & NPI 151.7 231.6 229.8 For Depreciation on Investments 8.5 23.3 4.5 For Standard Assets -6.2 -21.1 6.5 For Restructured Advances/Sacrifices & FITL -10.1 -34.0 -0.3 For Unhedged Forex Exposure -0.1 -2.4 0.5 Others 4.8 -32.2 -86.7 Taxes
Slide 33: Non Performing Assets
Non Performing Assets Gross NPA Net NPA 3.61% 3.57% 3.40% 3.59% 2.54% 2.57% 2.35% 2.60% 2.45% 1.45% Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 Gross NPA Movement Net NPA Movement Rs Crs Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 Rs Crs Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 Openin
Slide 34: Stressed Assets - QoQ
Stressed Assets - QoQ Gross Basis Net Basis Rs Crs Q3-FY 18 Q4-FY 18 Q3-FY 18 Q4-FY 18 NPA 1,755 1,980 1,211 1,416 Restructured Standard Advance 248 57 248 57 Other Stressed Advances 0 0 0 0 Total Stressed Assets 2,023 2,037 1,459 1,473 Advances 52,184 55,109 51,615 54,539 Stressed Assets as % of Ad
Slide 35: Restructured Advances Breakup
Restructured Advances Breakup Restructured Assets Break-up Sector Standard Restructure – Q4FY18 Rs Crs 571 513 509 501 262 28% 261 261 261 35% 297 240 309 252 37% 240 248 Sugar 57 Construction EPC Iron, Steel & Basic Metals Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Restructured NPA Restructured Standard Ad
Slide 36: Restructured Standard Asset Book
Restructured Standard Asset Book Rs Crs Restructured Standard Advance Increase in Fresh Uday – SDL Decrease in Slippages to Closing Opening Existing Addition Investments Balance NPA Balance Balance Infra Roads 190 - - - - 190 - Construction 22 - - - 1 - 21 EPC Others 36 - - - - - 36 Total 248 - - -
Slide 37: Movement in Restructured Accounts
Movement in Restructured Accounts Movement in Restructured Accounts Rs Crs Shift of focus from 0 Large Corporate 0 8 to SMEs 219 1 Defocusing from 509 Stressed Sectors 297 Special Cell & Asset Monitoring Cell Opening Fresh Increase Upgradation Closure Dec in Closing Addition in Balance in Standard I
Slide 38: Adequate Provisioning
Adequate Provisioning NPA Provisioning Rs Crs 171 170 540 541 Provision Coverage Ratio – 41.2% Opening Additions Deductions Closing 38
Slide 39: Fresh Slippages/Advance Ratios
Fresh Slippages/Advance Ratios Retail Slippage Agriculture Slippage 0.86% 0.90% 0.71% 0.61% 0.44% 0.34% 0.38% 0.27% 0.18% 0.18% Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 Mar-17 Jun-17 Sept-17 Dec-17 Mar-18 SME Slippage Corporate Slippage 0.85% 0.78% 3.51% 0.64% 2.37% 2.36% 0.30% 0.53% 0.18% 0.00% Mar-17 J
Slide 40: Well Capitalized to support Growth
Well Capitalized to support Growth BASEL III 12.7 In % 12.4 12.5 12.1 11.7 1.5 1.4 2.3 1.4 2.4 10.9 10.8 10.4 10.4 10.1 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Tier 2 Tier 1 40
Slide 41: Balance Sheet Overview- Q4 FY18
Balance Sheet Overview- Q4 FY18 Rs Crs Q4-FY 18 Q4-FY 17 Y-o-Y (%) Q3-FY 18 Q-o-Q (%) Capital & Liabilities 82,686 74,312 11.3% 79,314 4.3% Capital 181 180 0.3% 181 0.2% Reserves and Surplus 5,060 4,665 8.5% 4,940 2.4% Deposits 72,030 66,117 8.9% 68,109 5.8% Borrowings 4,043 1,958 106.5% 4,678 -13.6
Slide 42: Profit & Loss Overview- Q4 FY18
Profit & Loss Overview- Q4 FY18 Rs Crs Q4-FY18 Q4-FY 17 Y-o-Y (%) Q3-FY18 Q-o-Q (%) Net Interest Income 492 439 12.1% 509 -3.4% Other Income 179 138 29.7% 159 12.5% Total Income 671 577 16.3% 668 0.4% Operating Expenses 360 296 21.6% 338 6.5% Operating Profit 311 281 10.7% 330 -5.8% Provisions (Ex-T
Slide 43: Key Metrics- Quarterly
Key Metrics- Quarterly FY15 FY16 FY17 FY18 Particulars Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Net Interest Margin 2.7 2.8 2.9 2.9 2.7 2.7 2.9 2.5 2.7 2.5 2.8 2.9 2.6 2.7 2.8 2.7 (NIM) % CRAR Basel III 12.2 12.1 11.4 12.1 11.4 11.9 11.7 11.8 11.7 11.1 11.1 12.4 12.1 11.7 12.5 12.7 RoAA (Annu
Slide 44: Next Generation Bank
ayy Next Generation Bank © 44
Slide 45: Present across Customer Touch Points
Present across Customer Touch Points Traditional & Alternate Channels SIB Mirror + Mobile Banking ATMs Branches 1,382 ATMs across India 854 Branches & 55 Extension Counters Internet Banking Point of Sale 45
Slide 46: Technology Initiatives
Technology Initiatives SIB Mirror is a mobile-led platform with instant account access, balance retrieval, immediate fund transfers, all account intimations, and much more SIB-er Net is a suite of comprehensive internet banking services positioning SIB as a technology-driven bank offering superior s
Slide 47: Personal Banking: Technology Banking
Personal Banking: Technology Banking Active Internet Users Internet Transaction Volume Internet Transaction Value (000)’s (000)’s Rs Crs 954 6,075 899 885 5,594 839 865 4,906 303 4,489 4,700 260 192 205 223 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sep-17 De
Slide 48: Personal Banking: Debit Cards
Personal Banking: Debit Cards No of Active Debit Cards Debit Card Transaction Volumes In Millions In Millions 36.7 37.2 33.7 33.6 33.8 3.8 3.6 3.5 3.3 3.2 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Debit Card Transaction Value Rs Crs 6,949 7,090 6,655 6,685 5,480 Mar-17 Ju
Slide 49: An Inflection Point
An Inflection Point 4) 49
Slide 50: Moving Towards Vision 2020…
Moving Towards Vision 2020… Appointed Entered Opened International Memorandum Centralized Finance of Understanding Marketing & Corporation with Processing NSIC Centre ▪ Provides advisory ▪ Facilitates loans to ▪ Houses the Bank’s support to bank on the MSE and promotes Marketing Dept, Retail medium
Slide 51: About Us
@ yy About Us 51
Slide 52: Milestones
Milestones FIRST among the private FIRST bank in the private sector banks in Kerala to sector in India to open a become a scheduled bank in Currency Chest on behalf of 1946 under the RBI Act the RBI in April 1992 FIRST private sector bank to FIRST bank in the private sector open a NRI branch in to s
Slide 53: Expansion since FY07
Expansion since FY07 Branch Network ATM Network ~2X ~8X 854 1,382 464 783 465 277 248 398 174 122 142 84 201 39 66 51 FY07 FY18 FY07 FY18 Kerala South Ex-Kerala Others (Rest of India) 53
Slide 54: Performance since FY07
Performance since FY07 Net Interest Income Profit After Tax CAGR : 16% Rs Crs Rs Crs CAGR : 11% 1,966 335 104 368 FY07 FY18 FY07 FY18 Business (Advances + Deposits) Gross NPA CAGR : 18% Rs Crs In % 35bps 127,139 3.94 3.59 20,158 FY07 FY18 FY07 FY18 54
Slide 55: Leadership Team
Leadership Team Mr. V. G Mathew , MD & CEO ▪ Post Graduate in Physics and CAIIB with over 37 years of experience ▪ Joined SIB in January, 2014 as Executive Vice President and appointed as MD & CEO in October, 2014 ▪ Significant experience in Retail & Corporate Credit, Technology and Risk Management
Slide 56: Leadership Team
Leadership Team Mr. Thomas Joseph K, EVP (Operations) • Bachelors Degree in Engineering and Diploma in Management & CAIIB • He is associated with SIB since 1984 and heads Departments such as Risk Management, Technology, Marketing, Corporate Financial Management, Human Resource and Inspection & Vigil
Slide 57: Management Team
Management Team Mr. Benoy Varghese Mr. Sanchay Sinha (Country Head – Wholesale Banking) (Country Head – Retail Banking) • Bachelors Degree in Arts & Masters Degree in Business • Bachelor’s degree in Arts, Post Graduate Certificate in Administration and CAIIB Business Management (XLRI) Mr. John Thoma
Slide 58: Management Team
Management Team Mr. Shelly Joseph, General Manager Mr. Reddy N J, General Manager • Masters Degree in Commerce & CAIIB • Masters Degree in Commerce & LLB Mr. C.P. Gireesh, Chief Financial Officer • Bachelors Degree in Mathematics • Fellow member of the Institute of Chartered Accountants of India and
Slide 59: Award Wins
Award Wins Won Digital India Excellence Award 2017 Digital India Excellence Award 2017 for its innovation in mobile app ‘Digital e-lock’ in the 5th PAN-IIM World Management Awards 2017 59
Slide 60: Awards & Recognition
Awards & Recognition Awarded with ISO 27001:2013 Certification The certification process involved an extensive audit, conducted by British Standards Institution against the criteria set out by the ISO 27001:2013 standards on various domains of IT functions 60
Slide 61: Awards & Recognition
Awards & Recognition Won “IBA Banking Technology Awards” Won National Payments Excellence Awards - Won Finnoviti Award - 2017 2016 61
Slide 62: Awards & Recognition
Awards & Recognition Won Two IDRBT Best Bank Awards Bagged “Dun & Bradstreet, India’s Top Banks & Banking Awards 2017” 62
Slide 63: For further information, please contact:
For further information, please contact: Company Investor Relations Advisors The South Indian Bank Ltd. Strategic Growth Advisors Pvt. Ltd. CIN – L65191KL1929PLC001017 CIN - U74140MH2010PTC204285 Mr. C. P. Gireesh, CFO/ Mr. Shogun Jain/ Mr. Sagar Shroff Mr. Vijith S, Dy. General Manager shogun.jain@