Karur Vysya Bank Ltd. · NSE:KARURVYSYA
Karur Vysya Bank — Q3 FY2018-19 Earnings Presentation
45 slides from Karur Vysya Bank's earnings presentation, Feb 12, 2019
Slide 1: Cover letter to National Stock Exchange
IRC: F48:21: 164:2018 The Manager National Stock Exchange of India Limited Exchange Plaza, 5th Floor, Plot No.C/ 1 G Block, Bandra-Kurla Complex, Bandra (E), Mumbai 40005 1. Dear Sir, Sub: Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 20 15 - Intimation of Inve
Slide 2: Investor Presentation - Business Performance 31.12.2018
INVESTOR PRESENTATION Business Performance 31.12.2018 31.12.2018
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: Performance highlights
Performance highlights ….. Income Revenue at Rs. 841 crore – up 12% sequentially and 7% YoY Gross Advances up by 7% YoY at Rs. 47,766 crore Retail Assets grow 25% YoY & 4% sequentially Advances Commercial Assets grow at 9% YoY & 1% sequentially Corporate Portfolio degrowth (6% YoY & sequential
Slide 5: The Bank of choice - trusted by all
The Bank of choice - trusted by all Over Over Over 7 million 450000 700000 individuals businesses Agricultural customers
Slide 6: KVB – a unique franchise!
KVB – a unique franchise! Bank of Choice, trusted by : Over 7 million individuals Over 450000 businesses Over 700000 customers involved in agriculture 1 6 1 Unmatched presence in India’s fast growing hinterland 12 6 2 Category No. of Branches 6 1 Metro 201 4 2 16 14 Urban 159 1 5 Semi Urban 29
Slide 7: Blending Tradition with Modernity
Blending Tradition with Modernity New Digital Systems live and fully embedded: Full suite of retail asset products Working Capital for Commercial Clients (< 2 Crore) Retail liabilities / Banking Retail / Commercial digital product adoption improving ~42000 retail applications (for approx
Slide 8: Blending Tradition with Modernity
Blending Tradition with Modernity Co-origination of loans through API platform enabled Talent enhancement progressing well Liability Head & Head of Alternate Distribution hired. Campus hiring process initiated Branch Operational centralization process initiated Reduce operational risk &
Slide 9: Digital Transformation successfully implemented
Digital Transformation successfully implemented… Q4 • Term Commercial Credit 18-19 Loan Card – TEST LAUNCH Working Capital Dec. 18 (Fresh) & Auto Loan - LIVE Working Capital Aug./ (Enhancement, Adhoc), Loan Against Property, Personal Sept. 18 Loan & Digital Bank - LIVE Working Capital July 18 (Renew
Slide 10: Results Snapshot (EoP)
(Rs. crore) Results Snapshot (EoP*) Financial Indicators – 31.12.2018 Other Business Parameters YoY Growth Gross NPA 4,055.73 Parameter Amount % Net NPA 2,295.60 Total Gross NPA % 8.49 58,624 3 Deposits Net NPA % 4.99 Gross 47,766 7 PCR % 56.09 Advances Total 1,06,390 4 Basel III Capital 6,319.60 Bu
Slide 11: Business Profile (Averages)
(Rs. crore) Business Profile (Averages) Y-o-Y Growth Particulars Dec 18 Dec 17 Mar-18 Amount % Avg. Deposits 57,314 54,727 2,587 5 55,239 Avg. Demand Deposit 5,443 5,094 349 7 5,134 % to Total 9 9 9 Avg. Savings Deposit 11,150 9,939 1,211 12 10,086 % to Total 19 18 19 Avg. Time Deposit 40,720 39,694
Slide 12: Business Profile (EoP)
(Rs. crore) Business Profile (EoP*) Y-o-Y YTD Particulars Dec18 Dec 17 Mar 18 % % Total Deposits 58,624 57,119 3 56,890 3 Demand 5,852 5,549 5 5,576 5 Savings 11,616 10,474 11 11,001 6 CASA 17,468 16,023 9 16,577 5 Term Deposits 41,156 41,096 - 40,313 2 CASA % 30 28 29 Gross Advances 47,766 44,836 7
Slide 13: Balance Sheet
Balance Sheet (Rs. crore) Particulars Dec 18 Dec 17 Y-o-Y (%) Capital & Liabilities Capital 160 145 10 Reserves and Surplus 6,203 6,068 2 Deposits 58,624 57,120 3 Borrowings 959 1,737 (45) Other Liabilities and Provisions 1,644 1,461 13 Total 67,590 66,531 2 Assets Cash and Balances with RBI 3,194 2
Slide 14: Income v/s Expenses (Qtr.)
Income v/s Expenses (Qtr.) (Rs. crore) Net Interest Income Non Interest Income 700 300 600 643* 250 584 579 581 255 260 500 561 200 225 209 400 150 175 300 100 200 50 100 0 Dec 17 Mar 18 June 18 Sep 18 Dec 18 Dec 17 Mar 18 June 18 Sep 18 Dec 18 Total Operating Income Operating Expenses 1000 450 800
Slide 15: Operating Profit (Qtr.)
(Rs. crore) Operating Profit (Qtr.) 550 8 7 450 26 27 350 250 472* 453 395 382 398 150 50 -50 -21 Dec 17 Mar 18 June 18 Sep 18 Dec 18 Core Operating Profit Trading Profit 500 2.9 3.0 2.7 2.6 2.5 450 2.5 2.1 400 2.0 480 460 421 425 350 1.5 361 300 1.0 Dec 17 Mar 18 June 18 Sep 18 Dec 18 Operating Pro
Slide 16: Profit and Loss A/c (Qtr.)
(Rs. crore) Profit and Loss A/c (Qtr.) Q3 Q3 YoY Particulars FY 18-19 FY 17-18 (%) Net Interest Income 581 561 3 Other Income 260 225 16 Total Income 841 786 7 Operating Expenses 416 365 14 Operating Profit 425 421 1 Provisions 401 325 23 Credit Related 432 306 41 Others (31) 19 - Profit Before Tax
Slide 17: Profit and Loss A/c (9M)
(Rs. crore) Profit and Loss A/c (9M) 9M 9M YoY Particulars FY 18-19 FY 17-18 (%) Net Interest Income 1,744 1,655 5 Other Income 690 691 - Total Income 2,434 2,346 4 Operating Expenses 1,188 1,048 13 Operating Profit 1,246 1,298 (4) Provisions 1,036 880 18 Credit Related 1,000 832 20 Others 36 48 (25
Slide 18: Break Up of Other Income
(Rs. crore) Break Up of Other Income QUARTER 9 Months Particulars YoY YoY Dec. 18 Dec. 17 (%) Dec. 18 Dec. 17 (%) TOTAL NON-INT. INCOME 260 225 15 690 691 - 1) Fee Income 161 153 5 494 464 6 2) Investment trading 27 26 4 13 93 (86) profit 3) Forex Income 9 8 13 29 30 (3) 4) Others* 63 38 154 104 *In
Slide 19: Healthy Other Income Profile
(Rs. crore) Healthy Other Income Profile Growth in Other Income 300 35 30 31 • Steady growth in non interest 250 29 30 income, through diverse sources (fee 200 25 based, e-transactions, third party 23 25 products etc.) 150 255 260 100 225 209 20 • 31% share in total operating income 175 (Q3) 15 50 0
Slide 20: Break Up of Operating Expenses
(Rs. crore) Break Up of Operating Expenses QUARTER 9 Months Particulars YoY YoY Dec. 18 Dec. 17 Dec. 18 Dec. 17 (%) (%) Salary, allowances etc. 154 147 5 461 411 12 Prov. for employee 44 6 633 88 49 80 retirement benefits Total Staff Expenses 198 153 29 549 460 19 Other Operating 218 212 3 639 588 9
Slide 21: Key Ratios (Quarterly)
Key Ratios (Quarterly) Cost to Income NIM^ 60.00% 4.25% 4.13% 4.00% 52.12% 3.71% 3.75% 3.65% 3.60% 49.45% 3.57% 50.00% 46.45% 3.50% 45.18% 43.73% 3.25% 3.00% 40.00% Dec 17 Mar 18 June 18 Sep 18 Dec 18 Dec 17 Mar 18 June 18 Sep 18 Dec 18 ROA 10.00% ROE 1.00% 5.28% 4.60% 0.49% 5.00% 0.50% 0.43% 3.23%
Slide 22: Key Ratios (Qtr.)
Key Ratios (Qtr.) Particulars Q2 FY 18-19 Q3 FY 18-19 Q3 FY 17-18 Cost of Deposits 5.85 5.80 5.97 Yield on Advances 9.79 9.59 10.19 Cost of Funds 5.87 5.82 5.88 Yield on Funds 8.66 8.62 8.95 NIM 3.57 3.60 3.71 Spread 2.79 2.80 3.07 Cost to Income Ratio 52.12 49.45 46.45 Business/Emp. (Rs. Crore) 13.
Slide 23: Key Ratios (9M)
Key Ratios (9M) Particulars 9M FY 18-19 9M FY 17-18 Cost of Deposits 5.80 6.06 Yield on Advances 9.72 10.42 Cost of Funds 5.81 5.98 Yield on Funds 8.64 9.12 NIM 3.60 3.76 Spread 2.83 3.14 Cost to Income Ratio 48.81 44.70 Business/Emp. (Rs. Crore) 13.79 12.64 Profit/Emp. (Rs. Lakh) 2.61 4.88 4.75 4.7
Slide 24: Retail Liability Franchise: Granular & Sticky
Retail Liability Franchise : Granular & Sticky CASA Share 30% 20 Savings Demand 29% Deposit Mix 10% CASA 28% 15 6 6 5 20% 10 4 70% 4 23% 11 12 22% 5 10 6 8 0 Term Deposits Demand Deposits Savings Deposits FY 15 FY 16 FY 17 FY 18 Dec-18 FY 15 FY 16 FY 17 FY 18 Dec-18 Low concentration of Deposits Low
Slide 25: Investment Portfolio
Investment Portfolio Investments (Rs. crore) Portfolio wise Investment 0% 16753 HTM 16417 33.47% AFS 15992 HFT 66.53% Dec 17 Mar 18 Dec 18 Duration * Investment Portfolio HTM AFS HFT SLR Debentures/CD/MF/CP Shares 4.05 1.82 0.00 17.71% 1.04% Yield on Investment 7.01% 7.00% 7.00% 81.25% Debentures/CD
Slide 26: Advances – Business Verticals
(Rs. crore) Advances – Business Verticals Advances by value terms Advances - Portfolio wise 9204 7620 37% 35% 35% 35% 35% 6340 5918 5275 32% 33% 32% 13,527 31% 14397 28% 13612 13763 20% 13402 18% 17% 17% 17% 17% 17% 14% 15% 15% 16095 16,775 14504 12763 11774 7032 6979 7861 8,260 6240 FY15 FY16 FY17
Slide 27: Advances Portfolio
(Rs. crore) Advances Portfolio Y-o-Y YTD Particulars Dec 18 Dec 17 Mar 18 Growth % Growth % Gross Advances 47,766 44,836 7 45,973 4 Commercial 16,775 15,429 9 16,095 4 Corporate 13,527 14,341 (6) 14,397 (6) Retail (Personal 9,204 7,366 25 7,620 21 Banking)* Agriculture 8,260 7,700 7 7,861 5 Jewel Lo
Slide 28: Retail Portfolio
(Rs. crore) Retail Portfolio Advances outstanding as at Segment Dec-18 Dec-17 Mar-18 Mar-17 Mar-16 Mar-15 Housing 3,396 2,658 2,795 2,330 2,094 1,757 Mortgage (LAP) 1,637 1,313 1,393 965 787 568 Vehicle 1,065 1,007 1,017 921 831 782 Jewel Loans 578 587 578 596 703 793 Personal Loans 397 298 296 316
Slide 29: Security Coverage
(Rs. crore) Security Coverage Nature of security 31.12.18 Exposure backed by - Letter of Credit 542 Liquid Assets ^ 8,666 Vehicles 1,770 Commodities 682 Total (1) 11,660 Exposure secured by Immovable Property (% Coverage) > 100% 21,751 90% to <100% 7,395 75% to <90% 757 50% to <75% 4,204 <50% 3,556
Slide 30: Granular Loan Book
Granular Loan Book Commercial book Commercial Loans : Exposures upto Rs. 250 Mn Corporate Loans : Exposures above Rs. 250 Mn < 50 Mn >= 50 Mn < 100 Mn • Average ticket size of Rs. 4 Mn >= 100 Mn < 250 Mn • 79% of commercial loans are less than Rs. >= 250 Mn 50 Mn 12% 79% 8% Corporate book 1% < 2
Slide 31: Advances - Composition
Advances - Composition Well spread sub-sectorial exposures & diversified industrial exposures OTHER Rs. 478 Bn Breakup of Industrial exposure (Rs.128 Bn) EXPOSURES 9% INFRASTURCTURE OTHERS 15% 19% NBFC 4% POWER BILLS 3% MANUFACTURIN GEMS AND 3% G SECTOR JEWELLERY 5% AGRI 3% 27% TRANSPORT SECTOR CRE
Slide 32: Advances – Sector Details
(Rs. crore) Advances – Sector Details Growth Particulars Amount % to Total Advance over Dec-17 Dec-18 Dec-17 Mar-18 Dec-18 Dec-17 Mar 18 Amt % Manufacturing 12,753 13,402 13,626 27 30 30 (649) (5) Trading 7,990 7,463 7,851 17 17 17 527 7 Jewel loan 7,794 6,911 7,092 16 15 15 883 13 Personal loans @
Slide 33: Manufacturing Sector - Industry Wise
Manufacturing Sector - Industry Wise (Rs. crore) Amount % to Total Advance Y-o-Y Growth Industry Dec-18 Dec-17 Mar-18 Dec -18 Dec-17 Mar-18 Amount % TEXTILES 3,773 4,014 4,154 7.9 9.0 9.0 (241) (6.0) INFRASTRUCTURE 2,255 2,798 2,787 4.7 6.2 6.1 (543) (19.4) BASIC METAL & METAL 746 1,364 1,324 1.6 3.
Slide 34: Sector-wise Restructured Advances
(Rs. crore) Sector-wise Restructured Advances % to Total Restructured Advances Dec 18 Agri AMOUNT 17.21 Infra SECTOR Dec-18 Dec-17 0.96 Textiles Auto Loans INFRASTRUCTURE - 366 81.83 Educational Loans TEXTILES - 43 Food Processing AGRICULTURE 0.89 8 Others EDUCATIONAL LOANS 0.05 0 AUTO LOANS - 32 %
Slide 35: Stressed Book Analysis
Stressed Book Analysis (Rs. crore) 3000 2830 2673 2531 2539 2495 Movement of Restructured Advances 416 372 4.1 4.25 406 399 397 Apr . to Apr. to Apr-17 to 3.95 3.78 3.72 Dec. 18 Dec. 17 Mar-18 2000 3.67 Position as at 3.1 A/c Amt. A/c Amt. A/c Amt 1699 A. Beginning of the 22 262.43 33 841.81 33 841.
Slide 36: NPAs & Provisions
(Rs. crore) NPAs & Provisions Advances Net NPA Total Accretion 4056 3563 3707 VERTICAL O/s. Addition NPA rate (%) 3016 Dec. 18 Q3 Dec. 18 Q3 (annld.) 2663 2088 2052 2296 COMM. 16,775 86 962 2.05 1699 1863 1590 1692 1409 CORP. 13,527 246 2,776 7.27 929 1091 AGRI. 8,260 8 139 0.39 RETAIL 9,204 9 179 0
Slide 37: Movement of NPA
(Rs. crore) Movement of NPA Particulars Apr 18- Dec 18 Apr 17 - Dec 17 Apr 17 - Mar 18 Gross NPAs Opening Balance 3,016 1,484 1,484 Additions during the period 1,863 1,504 2,092 Reductions during the period 823 325 560 Closing Balance 4,056 2,663 3,016 Net NPAs Opening Balance 1,863 1,033 1,033 Addi
Slide 38: Provisions and Contingencies
(Rs. crore) Provisions and Contingencies 9M ended Quarter ended FY Provision for Dec -18 Dec-17 Dec -18 Dec-17 Sep-18 2017-18 NPA 1,042 611 432 348 207 1,025 Standard Assets (8) 8 2 3 (16) (2) Restructured Advances (11) (4) (2) - - (11) Loss on sale to ARC - 185 - - - 185 SDR, S4A, 5/25 etc. (10) 24
Slide 39: Capital Adequacy – Basel III
(Rs. crore) Capital Adequacy – Basel III Capital as at Nature Dec-18 Dec-17 Mar-18 Mar-17 Mar-16 Tier I 6,101 5,856 6,145 4,790 4,064 Tier II 218 243 226 278 330 Total 6,320 6,099 6,371 5,068 4,394 15.00% 14.61% 14.43% 14.59% 12.17% 12.54% 13.92% 14.08% 13.56% 11.85% 10.00% 11.26% Entire Tier I comp
Slide 40: Leveraging Technology - Delivery Channels
Leveraging Technology - Delivery Channels Market share in RTGS transactions POS Terminals 22068 22873 21928 1.14% 1.07% 1.05% 0.99% 10157 0.94% 9234 FY15 FY16 FY17 FY18 Dec 18 FY15 FY16 FY 17 FY 18 Dec 18 Share of RTGS transactions (by volume) POS TERMINALS Exponential growth in Mobile transactions
Slide 41: Human Resources
Human Resources Young workforce….. … well qualified … … lower attrition … 34 Others 11% 4.5% 33 33 33 33 3.9% GRADUATE 35% 2.7% 2.2% PG 54% 2.0% FY15 FY16 FY17 FY18 Dec 18 FY15 FY16 FY17 FY18 Dec 18 … leading to improved productivity 14 13 13 12 7.9 8.2 136 11 6.5 134 134 4.4 130 129 2.6 FY15 FY16 F
Slide 42: Blending Tradition with Modernity
Blending Tradition with Modernity
Slide 43: Blending Tradition with Modernity
Blending Tradition with Modernity…. Inception 1916 | Customer Base 7 million 102 years Consistently Profitable & Unbroken Dividend Pay Out 1st BANK RBI approves us as the first bank to issue BONUS SHARES Top Credit Rating (short term borrowings) by CRISIL & ICRA A1+ A BANKING PIONEER 42
Slide 44: A Decade of Progress
(Rs. crore) A Decade of Progress Year 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Paid up Capital 54 54 94 107 107 107 122 122 122 145 Reserves 1,296 1,566 2,020 2,601 2,978 3,219 4,124 4,451 4,723 6,066 Owned funds 1,350 1,620 2,114 2,708 3,085 3,326 4,246 4,573
Slide 45: Thank You
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