South Indian Bank Limited · NSE:SOUTHBANK
South Indian Bank — Investor Presentation (December 2011)
57 slides from South Indian Bank's investor presentation, December 2011
Slide 1: Investor Presentation Dec 2011
INVESTOR PRESENTATION DEC 2011
Slide 2: South Indian Bank… At A Glance
South Indian Bank… At A Glance 83 Years • Number of years in banking business 674 • Number of branches 614 • Number of ATM’s `58884 Cr • Business as on Dec 2011-2012 27% • Business Growth (Y – to – Y) 25% • Last 5 years business CAGR `280 Cr • Net Profit for the period ended Dec 2011-2012 `102 Cr •
Slide 3: History & Background, Overview, Key Strength, Future Strategy
History & Background Overview Key Strength Future Strategy 3
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Slide 5: History & Pioneering Initiatives
History & Pioneering Initiatives One of the oldest Banks in South India. Incorporated on January 25, 1929. Head Office: Thrissur, Kerala First among private sector Banks in Kerala to became a SCB in 1946. First private sector bank to open a NRI branch in Nov,1992 & an IFB branch in March 1993 First
Slide 6: Management
Management
Slide 7: Shareholding Pattern – as on 31.12.2011
Shareholding Pattern – as on 31.12.2011 Others 3.88% Individuals Individuals Corporates 39.46% FII's Fis and Banks 42.25% FII's Others Corporates Fis and Banks 7.81% 6.60% Diversified shareholding & tradition of good corporate governance practices 7
Slide 8: Vision & Mission
Vision & Mission CORPORATE VISION To emerge as the most preferred bank in the country in terms of brand, values, principles with core competence in fostering customer aspirations, to build high quality assets leveraging on the strong and vibrant technology platform in pursuit of excellence and custo
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Slide 10: Key Strength
Key Strengh Healthy Fundamentals Significant Turnaround Adequately Capitalised; •Benchmarked HR Practices & Introduced •12.03% CRAR & 9.61% Tier 1 ratio Performance Linked Incentive schemes, Asset Quality; ESOP, Annual Performance contest- • 0.94% GNPAs & 0.24% NNPAs Awards. •75.18% NPA Coverage rat
Slide 11: Vast and Rapidly Growing Branch Network
Vast and Rapidly Growing Branch Network Spread of Branches Average Branch & ATM network growth @ 10% (for last & current FY) 11
Slide 12: Branch Network – Category wise as in Dec 11
Branch Network – Category wise as in Dec 11 Metro, 99, 15% Rural, 124, 18% Rural Semi- Urban Urban, 142, 21% Urban Semi- Urban, 309, Metro 46% 12
Slide 13: State wise distribution of Branches
State wise distribution of Branches – Category wise as in Dec 11 STATES No: of Branches STATES No: of Branches KERALA 373 JHARKHAND 2 TAMIL NADU 117 MADHYA PRADESH 2 ANDHRA PRADESH 44 ORISSA 2 KARNATAKA 38 PONDICHERRY 2 MAHARASHTRA 24 RAJASTHAN 2 DELHI 21 ASSAM 2 WEST BENGAL 9 BIHAR 1 UTTAR PRADESH
Slide 14: Network Expansion (Number of branches added)
Network Expansion (Number of branches added) 70 61 60 60 Number of Branches added 50 50 40 30 Estimated 30 25 25 20 10 0 FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 14
Slide 15: Branch Network
Branch Network 800 700 701 600 641 Number of Branches 580 500 530 Estimated * 475 500 400 300 200 100 0 FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 * No: of branches as on 31.12.2011 – 674 15
Slide 16: Network Expansion (Number of ATMs added)
Network Expansion (Number of ATMs added) 136 140 116 120 Number of ATMs added 93 100 Estimated 80 55 60 50 40 20 0 FY 08 FY 09 FY 10 FY 11 FY 12 16
Slide 17: ATM Network
ATM Network 700 600 625 500 489 Estimated * Number of ATMs 400 373 300 280 200 225 100 0 FY 08 FY 09 FY 10 FY 11 FY 12 * No: of ATM’s as on 31.12.2011 – 614 17
Slide 18: Efficient Service Leveraging on Technology
EFFICIENT SERVICE LEVERAGING ON TECHNOLOGY Project SIBERTECH- 100% Core Banking Solution (CBS) using FINACLE from Infosys. Centralized Data Centre with most advanced technological platform in a new state of the art “Green” complied building at Kochi, Kerala. Emphasis on IT security & Risk Management
Slide 19: Range of Products
RANGE OF PRODUCTS Loan Products Deposit products Other Products Retail Business Loans •Savings Bank Accounts • Depository Account Housing Loans/ •Current Accounts • Mutual Funds sales Mortgages •Fixed/ Recurring • Life Insurance sales Auto Loans Deposits • General Insurance sales Personal Loans
Slide 20: Financial Inclusion
FINANCIAL INCLUSION Particulars March 10 March 11 Dec 11 Number of Business Correspondents (BCs) 0 7 29 appointed Number of villages with population above 2000 provided with banking facility (Rural 107 117 154 branches & BCs) Number of rural households covered 2.46 Lakh 2.47 Lakh 3.58 Lakh Number of
Slide 21: Strategic Tie Ups
Strategic Tie Ups Life Insurance with LIC General Insurance with Bajaj Allianz Mutual funds –All the leading AMCs in India Sri Lanka's Hatton National Bank (HNB) • Improve the remittance flow to India and Sri Lanka More than 30 exchange houses & banks in middle east • Facilitating fast remittances f
Slide 22: Recognitions
RECOGNITIONS Best Bank in Asset Quality (Pvt Sect or Bank) Award - Dun & Bradstreet 2011 Best Bank in Priority Sector Lending (Pvt Sect or Bank) Award - Dun & Bradstreet 2011 Technology Excellence Award in 2010 from IRDBT India’s Best Bank 2010 Award – “Business world – Price Water House Coopers Bes
Slide 23: Business Performance
Business Performance Busniess. Net profit NIM 23
Slide 24: Financial Highlights – FY12 (Q3)
Financial Highlights – FY12 (Q3) (` in Crores) Net Net Gross Profit Profit Business Advance Deposit Net NPA NPA (Upto Dec) (Q3) Dec11 280 102 58884 25050 33834 0.24% 0.94% 33% 36% 27% 31% 25% Dec 10 211 75 46186 19188 26998 0.39% 1.33% 24
Slide 25: Profitability – FY12 (Q3)
Profitability– FY12 (Q3) 200 179 180 160 143 140 120 102 100 Operating Profit 75 80 Net Profit 60 40 20 0 Q3 (FY 10-11) Q3 (FY 11-12) Year to Year Growth (Q3) Operating Profit • 25% Net Profit • 36% 25
Slide 26: Profitability – FY12 (Period upto Dec)
Profitability– FY12 (Period upto Dec) 600 488 500 400 372 300 280 Operating Profit 211 Net Profit 200 100 0 Q3 (FY 10-11) Q3 (FY 11-12) Year to Year Growth (Period upto Dec) Operating Profit • 31% Net Profit • 33% 26
Slide 27: Improved Quality of Earnings
Improved Quality of Earnings 1.20 1.11 1.05 1.04 1.06 0.99 1.00 0.98 0.93 0.94 0.88 0.85 0.80 0.60 ROA - Q3* ROAA - Q3* 0.40 0.20 0.00 FY-08 FY-09 FY-10 FY-11 FY-12 *Annualized RoA coming mainly from Core Income 27
Slide 28: Business Trend: Total Business and Growth
Business Trend for the period upto Dec Total Business and Growth (` in Crores) 120000 100,000 100000 78,000 80000 Projection 58,884 62,000 60000 46,186 Projection 40000 35,511 Projection 24,504 27,782 20000 0 FY-08 FY-09 FY-10 FY-11 FY-12 FY-12 Mar FY-13 Mar FY-14 Mar Business grew over 2.4 times at
Slide 29: Credit Deposit Ratio
Business Trend for the period upto Dec Credit Deposit Ratio 74% 73.03% 73% 72% 71% 70.28% 69.83% 70% 69% 68% 66.75% 66.97% 67% 66% 65% 64% 63% FY-08 FY-09 FY-10 FY-11 FY-12 29
Slide 30: Deposits for the period upto Dec
Deposits for the period upto Dec (` in Crores) Growth in Deposits Deposits 40000 33,834 35000 30000 26,998 25000 20,643 16,442 20000 14,484 15000 10000 5000 0 FY-08 FY-09 FY-10 FY-11 FY-12 Deposits increased @ 24% CAGR 30
Slide 31: Deposits – Composition and Trend
Deposits – Composition and Trend Composition of Deposits Annual Trend in Low cost deposits (` in Crores) (` in Crores) 7000 SB Deposit, 6058 6058, 18% 6000 4966 5000 4023 CD Deposit, 4000 1222, 4% 3000 2000 1183 976 1079 1019 1222 831 1000 416 459 452 0 Term Deposit, FY-10 FY-11 FY-12 26554, 78% SB
Slide 32: Advances for the period upto Dec
Advances for the period upto Dec Growth in Advances (` in Crores) Adavance 30000 25050 25000 19188 20000 14868 15000 11340 10020 10000 5000 0 FY-08 FY-09 FY-10 FY-11 FY-12 Advances increased by 31% (Y-to- Y) 32
Slide 33: Advances – Composition (Dec 2011)
Advances – Composition (Dec 2011) Sector Upto 5 Crores Above 5 Crores Total % to total Agriculture 2226.74 326.78 2553.52 10.19% MSME 1525.76 625.63 2151.39 8.59% Large Scale Industries 517.72 3833.92 4351.64 17.37% Housing 1160.65 402.49 1563.14 6.24% Commercial Real Estate 63.28 0.00 63.28 0.25% N
Slide 34: Trend in Cost & Yield (For the period upto Dec)
Trend in Cost & Yield (For the period upto Dec) Trend in Cost of Deposits Trend in Yield on Advances 9% 12.50% 12.30% 8% 7.77% 7.03% 12.00% 7% 7.15% 6% 6.74% 6.40% 11.50% 11.39% 5% 11.48% 11.00% 4% 3% 10.50% 10.70% 10.69% 2% 10.00% 1% 0% 9.50% FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10 FY-11 FY
Slide 35: Trend in Cost & Yield (Quarterly)
Trend in Cost & Yield (Quarterly) Trend in Cost of Deposits Trend in Yield on Advances 12.50% 12.30% 9% 12.00% 12.11% 8% 7.77% 11.75% 11.50% 7.60% 7.66% 7% 11.00% 10.90% 6.57% 10.50% 10.69% 6% 6.40% 10.00% 5% 9.50% Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 35
Slide 36: Investment Portfolio (Dec 2011)
Investment Portfolio (Dec 2011) SLR & Non SLR Securities Composition of Investment Book ` in Crores 9000 7952 8000 7000 6452 Category Amount Percentage 6000 5129 5000 Held to Maturity 7229.90 86.67% 3904 4000 3538 3000 Held for Trading 98.33 1.18% 2000 1570 1177 1102 1000 668 390 Available for Sale
Slide 37: Investment Portfolio: Yield and Duration
Investment Portfolio (Dec -2011) Yield on Investments Duration of Investments 8.00% Mar-11 Jun-11 Sep-11 Dec-11 6.84% 7.00% 7.04% 6.00% Total Investment 6.46% 6.35% 3.67 3.61 3.69 4.07 5.79% Portfolio 5.00% Total HM 4.00% Investment 4.81 4.68 4.61 4.55 3.00% Portfolio 2.00% Total HFT and AFS togethe
Slide 38: Adequately Capitalized
Adequately Capitalized 20 18 17.35 CRAR – Basel 2 16 15.39 14.89 14.01 14 12.03 12 10 Yearly 8 Quarterly - Q3 6 4 2 0 FY-10 FY-11 FY-12 The bank has CRAR in excess of the required minimum of 9% stipulated by RBI. 38
Slide 39: Strong Core Capital (Tier 1 & Tier 2 CRAR)
Strong Core Capital (Tier 1 & Tier 2 CRAR) 14% 12.31% 12% 11.27% 10.86% 10.80% 10% 9.61% 8% 6% 4% 2.58% 2.74% 2.65% 2.68% 2.42% 2% 0% Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Tier 1 CRAR Tier 2 CRAR Strong Core Capital. Dependence on Capital Instruments low. 39
Slide 40: Strong Core Capital (Trend)
Strong Core Capital (Trend) (` in crores) RWA Tier 1 Capital Tier 2 Capital Total Capital Mar 10 11377 1412 337 1749 Jun 10 11270 1476 326 1802 Sep 10 11861 1551 330 1881 Dec 10 13174 1622 340 1962 Mar 11 14647 1650 401 2051 Jun 11 15152 1645 401 2046 Sep 11 15173 1643 408 2051 Dec 11 17069 1640 414
Slide 41: Trend in Income & Expenses
Trend in Income & Expenses (For the period ended Dec) Total Income Trend in Expenses 3000 2500 2754 2265 (` in crores) 2500 2000 2000 1879 1506 1500 1587 1301 1500 1334 1071 1043 1000 857 1000 500 500 0 0 FY08 FY09 FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12 Int on Adv Int on Inv Oth Int Int Exp Staff E
Slide 42: Trend in Income
Trend in Income (For the period ended Dec) Yield on Funds Cost of Funds 8% 10.00% 9.85% 7.04% 7% 6.35% 9.50% 9.33% 6% 6.45% 6.05% 5.78% 8.98% 5% 9.00% 4% 8.50% 3% 8.54% 8.59% 2% 8.00% 1% 7.50% 0% FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10 FY-11 FY-12 42
Slide 43: Composition of Non-Interest Income
Composition of Non-Interest Income (` in crores) Particulars Period ended 31/12/2010 Period ended 31/12/2011 Commission, Exchange & Brokerage 25.39 24.89 Profit on sale of investment (Net) 25.12 31.83 Profit on sale of Land, Building & Other assets (Net) -0.01 0.06 Profit on Exchange Transactions (N
Slide 44: Profitability for the period ended Dec
Profitability for the period ended Dec Growth in Net Profit Net Interest Margin 3.10% 3.05% 300 280 3.05% 250 3.03% 211 3.00% 200 2.95% 145 148 150 2.90% 107 100 2.85% 50 2.80% 2.80% 0 2.75% FY-08 FY-09 FY-10 FY-11 FY-12 FY-10 FY-11 FY-12 Net profit grew at CAGR of 27% (Y-Y) in last 5 years. Net Int
Slide 45: Efficiency: ROE and ROA
Efficiency for the period ended Dec Return on Equity Return on Average Asset 20% 1.15% Return on Average Asset 17.51% 1.11% 18% 16.50% 1.10% 16% 14.76% 1.06% 13.62% 1.05% 1.04% 14% 12.32% 12% 1.00% 0.98% 10% 0.95% 0.93% 8% 6% 0.90% 4% 0.85% 2% 0% 0.80% FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10
Slide 46: Efficiency: Cost/Income and EPS
Efficiency for the period ended Dec Cost / Income Ratio Earning Per Share (Annualized) (Amount in ` ) 60% 4 3.29 51.07% 50.79% 3 50% 47.28% 45.68% 45.83% 2.48 3 40% 2 1.71 1.74 1.57 30% 2 1 20% 1 10% 0 FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10 FY-11 FY-12 46 46
Slide 47: Productivity per Employee
Productivity (for the period ended Dec) Average Business Per Employee Profit Per Employee (` in Lakh) (` in Lakh) 1,200 7 6.64 Profit Per Employee 956 6 1,000 5.39 787 5 800 4.23 4.04 649 4 570 3.42 600 514 3 400 2 200 1 0 0 FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10 FY-11 FY-12 47 47
Slide 48: Productivity per Branch
Productivity (for the period ended Dec) Average Business Per Branch Operating Profit Per Branch (` in Crores) (` in Lakh) 90 120 79.90 80 100 96.91 70 67.10 81.09 60 55.78 80 50.32 67.83 66.99 50 44.27 60 40 51.53 30 40 20 20 10 0 0 FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10 FY-11 FY-12 48 48
Slide 49: Asset Quality for the period ended Dec
Asset Quality for the period ended Dec Gross NPA & Net NPA(%) Provision Coverage 3.00% 80% 76.11% 75.18% 72.97% 74.27% 2.53% 70.69% 2.50% 70% 60% 2.00% 1.85% 50% 1.46% 1.50% 1.33% 40% 1.00% 0.94% 30% 20% 0.49% 0.50% 0.39% 0.39% 0.39% 0.24% 10% 0.00% 0% FY-08 FY-09 FY-10 FY-11 FY-12 FY-08 FY-09 FY-10
Slide 50: Asset Quality
Asset Quality (Amount in ` crore) Period Period Change in Gross NPA & Year ended Year ended ended ended Net NPA 31/03/2010 31/03/2011 31/12/2010 31/12/2011 Gross NPA 211 253 230 234 Gross NPA (%) 1.32% 1.33% 1.11% 0.94% Net NPA 62 74 60 58 Net NPA (%) 0.39% 0.39% 0.29% 0.24% Asset Quality maintained
Slide 51: Break-up of Provision
Break-up of Provision (` in Crore) Year ended Year ended Period ended Period ended Particulars 31/03/2010 31/03/2011 31/12/2010 31/12/2011 For NPA advance 34.98 27.74 31.75 7.34 For Depreciation on -40.94 9.37 0.38 24.48 Investments For NPA investment 2.14 0.26 0.26 0.00 For standard assets 6.43 21.
Slide 52: Performance Highlights
Performance Highlights (` in Crore) Year Performance Mar-10 Jun-10 Sep-10 Dec-10 ended Jun-11 Sep-11 Dec-11 Highlights Mar-11 CRAR Basel 2 (%) 15.40% 15.99% 15.86% 14.89% 14.01% 13.51% 13.48% 12.03% Return on Assets 1.07% 0.91% 1.03% 1.04% 1.05% 1.02% 1.05% 1.06% (Annualised) NIM (%) 2.80% 2.80% 3.0
Slide 53: Future Strategy
FUTURE STRATEGY 53
Slide 54: Way Forward
Way Forward 1 2 3 Enhancing income Ramping up low Enhancing from distribution of cost as well as productivity per third party retail liabilities branch/per products franchise employee 54 54
Slide 55: Key Focus
Key Focus Aims to open 60 branches & 120 ATMs this fiscal to boost network & take branch tally to 701 by March 2012. Aims to increase total business mix to Rs 1.25 lakh crore by March 2015. Enhancing income from distribution of third party products Ramping up low cost as well as retail liabilities.
Slide 56: Important Notice
IMPORTANT NOTICE 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.
Slide 57: Thank You
THANK YOU
South Indian Bank — Investor Presentation (December 2011) on 6ix