Karur Vysya Bank Ltd. · NSE:KARURVYSYA
Karur Vysya Bank — Q1 FY2020-21 Earnings Presentation
53 slides from Karur Vysya Bank's earnings presentation, Jul 30, 2020
Slide 1: Regulation 30 intimation of Investor Presentation to NSE
IRC:F48:71:452:2020 30.07.2020 The Manager, National Stock Exchange of India Ltd., Exchange Plaza, 5th Floor, Plot No. C/1, ‘G’ Block, Bandra — Kurla Complex, Bandra (East), Mumbai - 400 051 Dear Sir, Sub: Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 — In
Slide 2: Investor Presentation 30.06.2020
Investor Presentation 30.06.2020
Slide 3: Disclaimer
DISCLAIMER This presentation has been prepared by Karur Vysya Bank Limited (“the Bank”) solely by the Bank for information purposes only. This presentation is not a complete description of the Bank and the information contained herein is only current as of its date and has not been verified by anyon
Slide 4: KVB – a unique franchise!
KVB – a unique franchise! Unmatched presence in India’s fast growing hinterland 1 6 1 12 Category No. of Branches 1 6 6 Metro 200 1 Urban 155 15 4 1 14 1 Semi Urban 297 5 25 Rural 127 59 Total 779 1 51 121 7 420 21 Category 30.06.20 31.03.20 31.03.19 16% Metro 26% Urban Customer service Branches 779
Slide 5: Contents
Contents Q1 Performance Highlights Portfolio Performance New Initiatives Other Parameters www.kvb.co.in 4
Slide 6: Results Snapshot
(Rs. crore) Results Snapshot Financial Indicators – 30.06.2020 Other Business Parameters YoY Gross NPA 4,056 Parameter Amount Growth % Net NPA 1,585 Total Gross NPA % 8.34 60,065 (3) Deposits Net NPA % 3.44 Gross 48,617 (1) PCR % 72.74 Advances Total 1,08,682 (2) Basel III Capital 7,210 Business CRA
Slide 7: Balance Sheet
(Rs. crore) Balance Sheet Particulars Jun 20 Jun 19 Y-o-Y (%) Capital & Liabilities Capital 160 160 - Reserves and Surplus 6,546 6,336 3 Deposits 60,065 61,711 (3) Borrowings 1,041 2,705 (61) Other Liabilities and Provisions 1,568 1,503 4 Total 69,380 72,415 (4) Assets Cash and Balances with RBI 2,6
Slide 8: Business Profile
(Rs. crore) Business Profile Y-o-Y Particulars Jun 20 Jun 19 % Total Deposits 60,065 61,711 (3) Demand 6,179 6,241 (1) Savings 13,734 12,099 14 CASA 19,913 18,340 9 Term Deposits 40,152 43,371 (7) CASA % 33 30 Gross Advances 48,617 49,182 (1) Net Advances 46,131 46,982 (2) Total Business 1,08,682 1,
Slide 9: Investment Portfolio
Investment Portfolio Investments (Rs. crore) Portfolio wise Investment 17227 17357 16073 31.39% HTM 68.61% AFS June 19 Mar 20 June 20 Duration Investment Portfolio AFS* HFT HTM* 8.93% 0.76% 1.01 - 4.24 SLR Debentures/CD/MF/CP Yield on Investment Shares 6.97% 6.63% 5.67% 90.31% Debentures/CD/MF/CP in
Slide 10: Advances (by value & share)
(Rs. crore) Advances (by value & share) 17056 16539 16074 15620 14169 13589 12767 11978 11278 10893 10956 11193 9609 8936 8113 8161 Mar 19 June 19 Mar 20 June 20 ABG CBG CIG PBG 34% 34% 33% ABG 32% CBG 28% 28% 26% 25% CIG 22% 22% 23% 23% 20% PBG 18% 16% 17% Mar 19 June 19 Mar 20 June 20 Segments ABG
Slide 11: Capital Adequacy – Basel III
(Rs. crore) Capital Adequacy – Basel III As at Capital Jun 20 Mar 20 Mar 19 Mar 18 Mar 17 RWA 39,748 41,948 43,714 44,140 40,417 Tier I 6,412 6,404 6,245 6,145 4,790 Tier II 798 798 751 226 278 Total 7,210 7,202 6,996 6,371 5,068 19.00% 17.17% 18.14% 16.00% 14.43% 12.54% 16.13% 15.27% 13.92% 14.28%
Slide 12: Profit and Loss A/c
(Rs. crore) Profit and Loss A/c Particulars Jun 20 Jun 19 YoY (%) Net Interest Income 562 584 (4) Other Income 317 270 17 Total Income 879 854 3 Operating Expenses 405 409 (1) Operating Profit 474 445 7 Provisions 337 330 2 Credit Related 302 319 (5) Others 35 11 - Profit Before Tax 137 115 18 Tax 3
Slide 13: Break Up of Other Income
(Rs. crore) Break Up of Other Income Particulars Jun 20 Jun 19 YoY (%) TOTAL NON-INT. INCOME 317 270 17 1) Fee Income 121 168 (28) 2) Investment trading profit 178 67 - 3) Forex Income 5 9 - 4) Others* 13 28 - 5) Profit/(loss) on sale of land, building, other assets - (2) - etc. *Includes recoveries
Slide 14: Break Up of Operating Expenses
Break Up of Operating Expenses (Rs. crore) Particulars Jun 20 Jun 19 YoY (%) Staff Expenses 214 204 5 Of above – Prov. for employee retirement benefits 45 40 13 Other Operating Expenses 191 205 (7) TOTAL OPG. EXPENSES 405 409 (1) www.kvb.co.in 13
Slide 15: Key Ratios
Key Ratios NIM^ Cost to Income 54.05% 50.67% 3.49% 3.46% 3.46% 47.87% 3.33% 3.36% 46.68% 46.09% June 19 Sep 19 Dec 19 Mar 20 June 20 June 19 Sep 19 Dec 19 Mar 20 June 20 ROE ROA 6.29% 0.59% 3.87% 5.07% 0.46% 4.49% 0.40% 0.34% 0.08% 0.92% June 19 Sep 19 Dec 19 Mar 20 June 20 June 19 Sep 19 Dec 19 Mar
Slide 16: Provisions and Contingencies
(Rs. crore) Provisions and Contingencies Provision for Jun 20 Jun 19 NPA 228 318 Standard Assets 1 (1) Restructured Advances - 2 Others (incl. NPI) 20 12 COVID-19 Relief Package 73 - Investment Depreciation 15 (1) Total Provisions (excl. Tax) 337 330 Tax Expense 31 42 Total Provisions 368 372 www.kv
Slide 17: COVID Relief Package – Benefits availed book
(Rs. crore) COVID Relief Package – Benefits availed book Advances Book Benefited availed book – Benefit availed book Benefit availed book – (Ex Gold Loan) Vertical as on O/s as on O/s. as on 24.07.2020 – O/s. as on 30.06.2020 31.03.2020* 24.07.2020 ABG 9,609 2,807 31% 1,826 19% 388 4% CBG 16,074 12,
Slide 18: SMA Book (Excluding Gold Loans)
SMA Book (Excluding Gold Loans) 0.87% 0.66% 0.37% 0.45% 0.22% 0.08% SMA-1 SMA-2 SMA 30+ Moratorium Non Moratorium Moratorium status as of 24.07.2020 www.kvb.co.in 17
Slide 19: NPAs & Provisions
(Rs. crore) NPAs & Provisions 4511 4391 4424 4213 4056 9.17 8.89 8.92 8.68 8.34 2121 2223 2427 2351 2421 2322 4.94 2118 1946 1809 4.50 4.13 1585 3.92 3.44 June 19 Sep 19 Dec 19 Mar 20 June 20 June 19 Sep 19 Dec 19 Mar 20 June 20 Net NPA% Gross NPA% Gross NPA Net NPA NPA Provision 68.90 72.74 65.43 5
Slide 20: Movement of NPA
(Rs. crore) Movement of NPA Particulars Apr 20 - Jun 20 Apr 19 - Jun 19 Gross NPAs Opening Balance 4,213 4,450 Additions during the period 40 474 Reductions during the period 198 413 Closing Balance 4,056 4,511 Net NPAs Opening Balance 1,809 2,420 Additions during the period (200) 132 Reductions/wri
Slide 21: Contents
Contents Q1 Performance Highlights Portfolio Performance New Initiatives Other Parameters www.kvb.co.in 20
Slide 22: Portfolio Mix
(Rs. crore) Portfolio Mix Retail Commercial 23% on Total Portfolio 33% on Total Portfolio • Business Partnerships • Dedicated Business Owners established • Risk Rate Progressing • High Yield contracts Rs. 16,074 • Controlled Delinquencies Rs. 10,956 • Improved Asset Quality • Collection mechanisms C
Slide 23: Advances Portfolio
(Rs. crore) Advances Portfolio Y-o-Y Particulars Jun 20 Jun 19 Growth % Commercial 16,074 16,539 (3) Retail (Personal Banking)* 10,956 10,893 1 Agriculture 9,609 8,161 18 Corporate 11,978 13,589 (12) Gross Advances 48,617 49,182 (1) Jewel Loans (included above) 9,948 7,890 26 * Retail (ex. IBPC) 10,
Slide 24: Portfolio performance
Portfolio performance Portfolio performance Balance in INR , Base Mar.31,2017=100 184 SMA-1 SMA-2 SMA 30+ SMA 1 1.47 % 161 168 SMA 2 0.35 % 120 100 117 106 100 107 110 94 88 98 SMA 1 (Ex-Gold) 1.02 % 75 63 76 59 63 56 SMA 2 (Ex-Gold) 0.30 % 100 45 43 84 81 82 82 44 46 45 42 43 14 60 51 65 43 40 37 3
Slide 25: Robust Growth in Retail Segment
(Rs. crore) Robust Growth in Retail Segment 4,636 4,548 3,619 2,795 2,330 1,712 1,683 1,672 1,393 1,017 1,044 965 921 989 895 963 1,014 596 578 625 FY 17 FY 18 FY 19 FY 20 June 20 Housing Mortgage (LAP) Vehicle Jewel Loans www.kvb.co.in 24
Slide 26: Retail Portfolio Distribution
(Rs. crore) Retail Portfolio Distribution Advances outstanding as at Segment Jun 20 Mar 20 Mar 19 Mar 18 Mar 17 Housing 4,636 4,548 3,619 2,795 2,330 Mortgage (LAP) 1,672 1,683 1,712 1,393 965 Vehicle 963 989 1,044 1,017 921 Jewel Loans 1,014 895 625 578 596 Personal Loans 549 561 424 296 316 Educat
Slide 27: Digital Retail – Origination Volumes
Digital Retail – Origination Volumes 1 Mn 0.8 Mn 5821 5739 5570 1 Mn 0.8 Mn 4955 4266 4320 4370 4060 1 .1 Mn 1174 1256 Jun'19 Sep'19 Dec'19 Mar'20 Jun'20 Disbursed Applications Disbursed Amount (in Million) Average Ticket Size www.kvb.co.in 26
Slide 28: Golden Journey
Golden Journey (Rs. crore) June 2020 • Towards New Pinnacle Mar. 2010 • Portfolio ~Rs. 10,000 crore • Standalone Jewel Loan 9948 10000 Mar. 2003 outlets initiated • Portfolio stands • Digital Jewel Loan at Rs. 1,777 crore process implemented 7890 – a new high 7388 • Jewel Loan Book 6431 at less than
Slide 29: Credit Portfolio – other metrics
Credit Portfolio – other metrics Short term credit (Working Capital) forms major part of credit portfolio 79% 80% 75% 76% 77% 21% 20% 25% 24% 23% FY 17 FY 18 FY 19 FY 20 June 20 Working Capital Loans Term Loans Low concentration : Top 20 borrowers (% of overall loans) Ticket size of Commercial Book
Slide 30: Digital SME Platform – Origination Volumes
Digital SME Platform – Origination Volumes 1000 964 10 Lakhs 900 28 Lakhs 27 Lakhs 789 800 768 700 600 26 Lakhs Amount in Crs 527 500 453 25 Lakhs 418 400 373 311 284 300 200 169 100 0 JUN 2019 SEP 2019 DEC 2019 MAR 2020 JUN 2020 Submission Disbursement Average Ticket Size www.kvb.co.in 29
Slide 31: Corporate Book (exposure > Rs. 25 crore)
(Rs. crore) Corporate Book (exposure > Rs. 25 crore) Standard Corporate advances > 1 Bn 4000 8.0 6.2 5.6 5.2 4.7 4.6 4.5 4.6 2500 5.0 3.8 2992 2540 2733 2244 2322 2211 2304 1891 1000 2.0 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Amount > 100cr % on advance 14% 33% 28% • Average ticket
Slide 32: Advances – Composition
Advances – Composition Well spread sub-sectorial exposures & diversified industrial exposures Rs.486 Bn Breakup of Industrial exposure (Rs.114 Bn) INFRASTRUCTURE POWER NBFC OTHER TEXTILES BILLS 3% EXPOSURES 10% 10% 1% 14% MANUFACTURI IRON & STEEL Agri NG SECTOR 5% 6% 2% 24% FOOD PROCESSING CRE 4% 6%
Slide 33: Advances – Composition
(Rs. crore) Advances – Composition Particulars Amount % to Total Advance Y-o-Y Growth Jun 20 Jun 19 Jun 20 Jun 19 Amt % Manufacturing 11,354 12,412 23 25 (1,058) (9) Trading 6,822 7,560 14 15 (738) (10) Jewel loan 9,948 7,890 20 16 2,058 26 Personal loans @ 7,660 7,374 16 15 286 4 CRE 3,013 2,754 6
Slide 34: Manufacturing Sector - Industry Wise
(Rs. crore) Manufacturing Sector - Industry Wise Amount % to Total Advance Y-o-Y Growth Industry Jun 20 Jun 19 Jun 20 Jun 19 Amount % Textile 3,750 3,876 7.7 7.9 (126) (3) Infrastructure 1,835 2,056 3.8 4.2 (221) (11) Basic Metal & Metal Products 708 875 1.5 1.8 (167) (19) Food Processing 355 587 0.
Slide 35: Infrastructure Advances
(Rs. crore) Infrastructure Advances Amount O/s % to Total Advance Y-o-Y Growth Infrastructure Jun 20 Jun 19 Jun 20 Jun 19 Amt % Power 644 653 1.3 1.3 (9) (1) Road 320 483 0.7 1.0 (163) (34) Infra Others 871 920 1.8 1.9 (49) (5) TOTAL 1,835 2,056 3.8 4.2 (221) (11) Power Sector Exposure Ownership Jun
Slide 36: Sector-wise Restructured Advances
(Rs. crore) Sector-wise Restructured Advances Amount % to Total Restructured Advances Jun-19 S. N. SECTOR Jun 20 Jun 19 3.11 Agri 9.62 Textiles 1 Textile 62.06 13.08 5.19 Chemical & its 48.44 2 Cement & Cement Products 26.05 - products Food Processing 3 Food & Food Processing 19.12 36.55 4.24 26.88
Slide 37: Stressed Book Analysis
(Rs. crore) Stressed Book Analysis Movement of Restructured Advances 3000 2819 5.00 Apr 20 to Jun Apr 19 to Jun 2728 2673 2548 20 19 2325 Particulars 361 446 A/c’s Amt. A/c’s Amt. 524 546 A. Position at the beginning of 543 73 193.29 34 72.09 3.89 the period 2000 3.72 3.67 3.73 B. Addition during th
Slide 38: Security Coverage
(Rs. crore) Security Coverage Nature of security 30.06.20 Exposure backed by - Letter of Credit 123 Liquid Assets ^ 10,678 Vehicles 2,614 Commodities 202 Total (1) 13,617 Exposure secured by Immovable Property (% Coverage) > 100% 22,940 90% to <100% 8,326 75% to <90% 1,747 50% to <75% 3,681 <50% 2,4
Slide 39: Retail Liability Franchise : Granular & Sticky
Retail Liability Franchise : Granular & Sticky 5% 8% < Rs.15 Lakhs Rs.15 Lakhs-Rs.1 Cr Term deposits are primarily retail deposits 21% Rs.1 Cr-Rs.5 Cr 95% of term deposits > Rs.5 Cr are < Rs.5 Cr 66% Low concentration of Deposits Low dependence on wholesale deposits 23% 7% 6% 6% 6% 6% Term Depos
Slide 40: Contents
Contents Q1 Performance Highlights Portfolio Performance New Initiatives Other Parameters www.kvb.co.in 39
Slide 41: Digital Banking - DLite
Digital Banking - DLite Acquisition - Saving Account - Term Deposit Insurance - non-life & Health Insurance (Online Integration) Scheduled* Q4, FY20-21 Loan Loan Booking Payment - Jewel Loan Scheduled* Q3, FY20-21 Retail Customer Maintenance Credit Card, - Manage Profile, Nominee, Scheduled* Locker,
Slide 42: Adoption of Video KYC
Adoption of Video KYC • To have expedient customer boarding as well regulatory assent, we are in verge of V-CIP* • Facilitates for New-KYC as well Re-KYC • Will reduce both TAT & Cost on acquisition. • High technologies of AI / Face Matching Tools are used to secure storage and Impenetrable security
Slide 43: New Initiatives
New Initiatives Schedules ahead Currency Chest Q3, automation FY20-21 Q2, e-Mandates FY20-21 automation Q2, FY20-21 Q2, Digital Current A/c FY20-21 with e-Sign Digital Savings A/c with e-Sign www.kvb.co.in 42
Slide 44: Expense Management Center – A key enabler to our Digital journey
Expense Management Center – A key enabler to our Digital journey Business Planning & Analytics : Focus at / on - Digital initiatives enabling • Business Segment and Cost Center level accelerated growth • Expense line level – Comprehensive vs Anecdotal in customer • Revenue to Expense line dependency
Slide 45: Contents
Contents Q1 Performance Highlights Portfolio Performance New Initiatives Other Parameters www.kvb.co.in 44
Slide 46: Business Growth
(Rs. thousand crore) Business Growth 120 111 109 120 108 103 95 80 60 59 60 80 57 54 40 40 Loans and Advances 46 51 49 49 41 75% 50 71% 0 0 67% 68% 67% 40 FY 17 FY 18 FY 19 FY 20 June 20 66% Gross Advances Deposit Business 30 20 10 41 45 49 46 46 50% 0 FY 17 FY 18 FY 19 FY 20 June 20 net Advances Ad
Slide 47: CASA Growth
(Rs. thousand crore) CASA Growth 20 6 6 6 15 6 5 14 13 10 12 11 10 5 0 FY 17 FY 18 FY 19 FY 20 June 20 Savings Demand 20 35% 33% 15 31% 30% 10 29% 30% 28% 5 15 17 18 19 20 0 25% FY 17 FY 18 FY 19 FY 20 June 20 CASA CASA Mix www.kvb.co.in 46
Slide 48: Income – Expenses – Op. Profit
(Rs. crore) Income – Expenses – Op. Profit Net Interest Income Non Interest Income 400 650 584 596 577 591 347 562 317 270 278 260 200 325 0 0 June 19 Sep 19 Dec 19 Mar 20 June 20 June 19 Sep 19 Dec 19 Mar 20 June 20 Opg. Profit Margin Operating Expenses 500 2.7 2.7 3.0 500 2.4 2.4 230 227 223 2.1 2
Slide 49: Key Ratios
Key Ratios Particulars Jun 20 Jun 19 Cost of Deposits (%) 5.37 5.82 Yield on Advances (%) 9.32 9.61 Cost of Funds (%) 5.42 5.88 Yield on Funds (%) 8.01 8.60 NIM (%) 3.36 3.49 Spread (%) 2.59 2.71 Cost to Income Ratio (%) 46.09 47.87 Business/Emp. (Rs. Crore) 13.87 14.25 Profit/Emp. (Rs. Lakh) 5.39 3
Slide 50: Leveraging Technology - Delivery Channels
Leveraging Technology - Delivery Channels Market share in RTGS transactions POS Terminals POS TERMINALS 1.14% 1.19% 1.14% 22873 1.07% 1.04% 22068 21959 15534 15092 Mar 17 Mar 18 Mar 19 Mar 20 June 20 Share of RTGS transactions (by volume) Mar 17 Mar 18 Mar 19 Mar 20 June 20 Mobile transactions volum
Slide 51: Human Resources
Human Resources Young workforce….. … number of employees… … lower attrition … 3.9% 3.8% 35 2.7% 34 34 7956 7935 7834 7663 2.2% 7400 33 33 0.5% FY 17 FY 18 FY 19 FY 20 Jun-20 FY 17 FY 18 FY 19 FY 20 Jun-20 FY 17 FY 18 FY 19 FY 20 Jun-20 … leading to improved productivity 134 130 142 138 140 8.2 14.42
Slide 52: A Decade of Progress
(Rs. crore) A Decade of Progress Year 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Paid up Capital 94 107 107 107 122 122 122 145 160 160 Reserves 2,020 2,601 2,978 3,219 4,124 4,451 4,723 6,066 6,205 6,440 Owned funds 2,114 2,708 3,085 3,326 4,246 4,573 4,845 6,21
Slide 53: Thank You
Karur Vysya Bank — Q1 FY2020-21 Earnings Presentation on 6ix