City Union Bank Limited · NSE:CUB
City Union Bank — Q3 FY2021 Earnings Presentation
55 slides from City Union Bank's earnings presentation, Feb 3, 2021
Slide 1: Cover letter to stock exchanges: Investor presentation Q3 FY 2021
® City UNION BANK LIMITED CIN : L65110TN1904PLC001287 CUB Regd. Office : 149, T.S.R. (Big) Street, Kumbakonam - 612 001, Thanjavur District, Tamil Nadu. Telephone No : 0435 - 2402322 Fax : 0435 - 2431746 Ta cei E-mail: shares@cityunionbank.com — Website : www.cityunionbank.com C.0/Shares/LR-5/2020-2
Slide 2: City Union Bank - December 2020
City UNION BANK
Slide 3: Disclaimer
Disclaimer 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. Certain
Slide 4: Technology Initiatives - Video KYC account opening
Technology Initiatives - Video KYC – Instant account opening via Website and app Customers can open new Savings Accounts, Salary Accounts and Student Accounts instantly from their Mobile Banking app using “Open New CUB Account” option. New customers can fill in their information like: a) PAN Number,
Slide 5: Table of Contents
TABLE OF CONTENTS 5 11 16 Overview Performance Highlights – Financial Performance & December 2020 Business Profile 41 47 49 51 Covid Outbreak Branch Network Shareholding Pattern Corporate Governance 4
Slide 6: Overview
OVERVIEW ST’ ATIS AIP AA
Slide 7: Overview Facts & Figures
OVERVIEW City Union Bank Ltd., the oldest Private Sector Bank in India, was founded on October 31, 1904 and is headquartered at Kumbakonam,Tamil Nadu, India. The main focus of the Bank – lending to MSME, Retail / WholesaleTrade with granular asset profile including providing short term and long term
Slide 8: Key Milestones
KEY MILESTONES Rights Issue @ 1 : 4- Bonus Issue @ Amalgamation of ‘TheCity Entered into Preferential allotment to reward the existing 1 : 10 - Forward Bank Limited’ & agreement withTCS for equity shares shareholders & employees rewarded Scheduled bank since ‘The Union Bank Limited’ for core banking
Slide 9: A Specialized Banking Model Aligned to SME / MSME
CITY UNION BANK - A SPECIALIZED BANKING MODEL ALIGNED TO TARGET SEGMENT – SME / MSME SME / MSME Prudent Risk Invested in Purely retail focus Management Robust Infrastructure Liability Franchise SME/MSME specialized SME exposures’ result in Comprehensive No Certificate of Deposit business model focus
Slide 10: Competitive Advantages
COMPETITIVE ADVANTAGES NETWORK STRONG TRACK RECORD Pan India presence with 700 branches Continuous profitability and dividend payout in all Strong presence in South India (628 branches) 115+ years of operations of which 485 are in Tamil Nadu alone Business growth of 20%+ CAGR in last 10 years ROBUST
Slide 11: Credit Rating
CREDIT RATING ICRA has assigned “AA-” for Long Term - issuers with this rating are considered to have “High Degree of Safety” regarding timely servicing of financial obligations. “A1+-” for Certificate of Deposits (CD) - issuers with this rating are considered to have “Strong Degree of Safety” regar
Slide 12: Performance Highlights - December 2020
PERFORMANCE HIGHLIGHTS – DECEMBER 2020 11
Slide 13: Q3 FY 2021 Performance - A Snapshot
Q3 FY 2021 PERFORMANCE – A SNAPSHOT Deposits increased by 9% from Rs.398 Bn to Rs.433 Bn Y-o-Y Advances registered a growth of 8% from Rs.338 Bn to Rs.365 Bn Y-o-Y Total business grown by 8% from Rs.736 Bn to Rs.798 Bn Y-o-Y Gross Profit increased by 49% to Rs.4,584 Mn from Rs.3,084 Mn (Q3-Vs-Q3) an
Slide 14: Q3 FY 2021 vs Q3 FY 2020 Performance Snapshot
Q3 FY 2021 VS Q3 FY 2020 PERFORMANCE – A SNAPSHOT (in INR Mn) 432,883 365,037 797,920 118,984 9% 8% 8% 28% 398,120 338,276 736,396 92,943 Deposits Advances Total Business CASA 4,584 1,699 4,891 36.22% 49% -ve 14% % 3,084 1,924 4,273 45.85% Gross Profit Net Profit Net Interest Cost to Income Income 1
Slide 15: 9M FY 2021 vs 9M FY 2020 Performance Snapshot
9M FY 2021 VS 9M FY 2020 PERFORMANCE – A SNAPSHOT (in INR Mn) 432,883 365,037 797,921 118,985 9% 8% 8% 28% 398,120 338,276 736,396 92,943 Deposits Advances Total Business CASA 11,991 4,816 14,012 38.85% 19% -Ve 12% % 10,063 5,716 12,557 42.70% Gross Profit Net Profit Net Interest Cost to Income Inco
Slide 16: FY 2020 vs FY 2019 Performance Snapshot
FY 2020 VS FY 2019 PERFORMANCE – A SNAPSHOT (in INR Mn) 408,325 345,762 754,087 101,970 6% 5% 5% 5% 384,480 330,652 715,132 96,982 Deposits Advances Total Business CASA 13,414 4,763 16,752 43.04% 8% -ve 4% % 12,400 6,829 16,115 41.67% Gross Profit Net Profit Net Interest Cost to Income Income 1.00%
Slide 17: Financial Performance & Business Profile
FINANCIAL PERFORMANCE & BUSINESS PROFILE 16
Slide 18: Q3 FY 21 vs Q3 FY 20 Performance - Snapshot
Q3 FY 21 VS Q3 FY 20 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q3 FY 2021 Q3 FY 2020 INC / (DEC) Growth Growth % Deposits 432,883 398,120 34,763 9% Advances 365,037 338,276 26,761 8% Total Business 797,920 736,396 61,524 8% Demand Deposits 32,083 28,216 3,867 14% Saving
Slide 19: Q3 FY 21 vs Q3 FY 20 Performance - Snapshot
Q3 FY 21 VS Q3 FY 20 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q3 FY 2021 Q3 FY 2020 INC / (DEC) Growth % Q2 FY 2021 Net Interest Income 4,890 4,273 617 14% 4,752 Other Income 2,298 1,423 875 61% 1,693 Operating Expenses 2,604 2,612 -8 -ve 2,598 Gross Profit 4,584 3,084
Slide 20: 9M FY 21 vs 9M FY 20 Performance - Snapshot
9M FY 21 VS 9M FY 20 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS 9M FY 2021 9M FY 2020 INC / (DEC) Growth % Net Interest Income 14,012 12,557 1,455 12% Other Income 5,596 5,006 590 12% Operating Expenses 7,617 7,500 117 2% Gross Profit 11,991 10,063 1,928 19% Provisions &
Slide 21: FY 20 vs FY 19 Performance - Snapshot
FY 20 VS FY 19 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS FY 2020 FY 2019 INC / (DEC) Growth Growth % Deposits 408,325 384,480 23,845 6% Advances 345,762 330,652 15,110 5% Total Business 754,087 715,132 38,955 5% Demand Deposits 29,244 32,145 -2,901 -ve Saving Deposits 72
Slide 22: FY 20 vs FY 19 Performance - Snapshot
FY 20 VS FY 19 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS FY 2020 FY 2019 INC / (DEC) Growth % Net Interest Income 16,752 16,115 637 4% Other Income 6,799 5,144 1,655 32% Operating Expenses 10,137 8,859 1,278 14% Gross Profit 13,414 12,400 1,014 8% Provisions & Contingenc
Slide 23: Provisions & Contingencies - Breakup
PROVISIONS & CONTINGENCIES – BREAKUP (in INR Mn) PARTICULARS Q3 FY 21 Q3 FY 20 9M FY 21 9M FY 20 Q2 FY 21 FY 19-20 Provision for: - Tax 700 350 1,650 1,300 500 1,100 - Bad Debts 310 785 1,130 3,205 320 6,310 - Covid 19 1,250 - 3,400 - 1,150 1,250 - Standard Assets 500 60 620 113 80 193 - Depn on Inv
Slide 24: Q3 FY 21 vs Q3 FY 20 - Income and Expenses Breakup
Q3 FY 21 VS Q3 FY 20 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP Q3 FY Q3 FY Q3 FY Q3 FY PARTICULARS Growth % PARTICULARS Growth % 2021 2020 2021 2020 Interest on Loans 8,906 8,836 1% Int Exp on Deposits 5,463 6,183 -ve Interest on Investments 1,470 1,
Slide 25: 9M FY 21 vs 9M FY 20 - Income and Expenses Breakup
9M FY 21 VS 9M FY 20 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP 9M FY 9M FY 9M FY 9M FY PARTICULARS Growth % PARTICULARS Growth % 2021 2020 2021 2020 Interest on Loans 26,817 26,140 3% Int Exp on Deposits 16,965 18,311 -ve Interest on Investments 4,39
Slide 26: FY 20 vs FY 19 - Income and Expenses Breakup
FY 20 VS FY 19 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP FY FY FY FY PARTICULARS Growth % PARTICULARS Growth % 2020 2019 2020 2019 Interest on Loans 34,946 31,777 10% Int Exp on Deposits 24,369 21,080 16% Interest on Investments 6,099 5,536 10% Other
Slide 27: Strong Deposits and Advances Growth
STRONG DEPOSITS AND ADVANCES GROWTH (in INR Mn) DEPOSITS ADVANCES 11% 13% CAGR 408,325 432,883 CAGR 365,037 384,480 330,652 345,762 328,526 282,386 301,157 241,125 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 31-DEC-2020 31-MAR-201 31-MAR-2018 31-MAR-2019 31-MAR-2020 31-DEC-2020 BUSINESS CASA 12%
Slide 28: Income Growth Over the Years
INCOME GROWTH OVER THE YEARS… (in INR Mn) NET INTEREST INCOME GROWTH OTHER INCOME GROWTH 14% 13% CAGR CAGR 16,115 16,752 14,303 14,012 (9M) 11,988 6,799 5,321 5,144 5,596 (9M) 4,840 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 31-DEC-2020 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 31-DEC-202
Slide 29: Key Business Indicators
KEY BUSINESS INDICATORS PARTICULARS Q3 FY 21 Q3 FY 20 9M FY 21 9M FY 20 Q2 FY 21 FY 19-20 Cost of Deposits 5.16% 6.17% 5.46% 6.22% 5.54% 6.20% Yield on Advances 9.87% 10.73% 10.16% 10.82% 10.21% 10.76% Yield on Investments 5.79% 6.62% 5.89% 6.74% 5.79% 6.69% Net Interest Margin 4.16% 3.96% 4.09% 3.9
Slide 30: Key Business Ratios - Yearly Trends
KEY BUSINESS RATIOS – YEARLY TRENDS NET INTEREST MARGIN RETURN ON ASSETS 5.00% 1.70% 1.64% 1.60% 1.60% 1.50% 4.42% 4.50% 4.32% 1.50% 4.17% 4.09% 1.40% 3.98% 4.00% 1.30% 1.25% 1.20% 3.50% 1.10% 1.00% 1.00% 3.00% 0.90% 31-MAR-17 31-MAR-18 31-MAR-19 31-MAR-20 31-DEC-20 31-MAR-17 31-MAR-18 31-MAR-19 31-
Slide 31: Cost of Deposits & Yield on Advances
COST OF DEPOSITS & YIELD ON ADVANCES (in %) 16 14 13.56 13.49 13.43 13.18 12.83 12.47 12.10 12 11.46 10.95 10.76 10.16 10 8.44 8.37 8.15 8.11 7.62 8 6.94 6.82 6.29 6.17 6.20 6 5.46 4 2 0 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Dec 20 Spread between cost of deposits and
Slide 32: Efficiency
EFFICIENCY COST INCOME RATIO (%) CASA RATIO (%) 27.49 43.04 41.67 40.94 25.22 24.97 24.22 38.85 38.46 23.37 31-Mar-2017 31-Mar-2018 31-Mar-2019 31-Mar-2020 31-Dec-2020 31-Mar-2017 31-Mar-2018 31-Mar-2019 31-Mar-2020 31-Dec-2020 BUSINESS PER EMPLOYEE PROFIT PER EMPLOYEE (in INR Mn) (in INR Mn) 135.38
Slide 33: Loan Book - Products Composition
LOAN BOOK – PRODUCTS COMPOSITION % toTotal Advances 1% Working capital loans yielding higher interest constitute 60% of advances Bills Purchased & Bills Discounted Re-pricing possible at short intervals Term Loan thus reducing interest rate risk 39% Cash Credit & Demand Loan ~95% of our loan book is
Slide 34: Loan Book Sectoral Deployment - Position as on 31.12.2020
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 31.12.2020 (in INR Mn) Loans collateralized by Deposits 4,912 Retail Traders 5,636 Infrastructure 3,297 Personal Loans 8,803 1% NBFC Large Industries 2% 2% 2,862 18,732 5% Housing Loans 21,741 6% 35% M S M E CRE 127,309 26,385 7% SECTORAL DEPLOYMENT Oth
Slide 35: Loan Book Sectoral Deployment - Secured & Unsecured Advances
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 31.12.2020 (in INR Mn) SECURED & UNSECURED ADVANCES Particulars Amount (INR Mn) (%) Secured Loans 361,154 99% Unsecured Loans 3,883 1% Total 365,037 100% Trading & MSME loans earning higher yield constitute about 50% Diversified credit portfolio reduces
Slide 36: Loan Book - Advances to Major Industries
Corporate Governance Loan Book – Advances to Major Industries (in I N R M n ) Advances to Major Industries 31st December 2020 TEXTILE a) Cotton 16,378 (4%) b) Other Textiles 21,683 (6%) METALS a) Iron & Steel 11,732 (3%) Amount % to Total b) Other Metals 5,692 (2%) Industry Name (in INR Mn) Advances
Slide 37: Asset Quality
ASSET QUALITY (in INR Mn) GROSS NPA QTM & GROSS NPA % NET NPA QTM & NET NPA % 14,134 7,785 10,717 5,915 9,771 5,272 8,566 4,748 6,820 4.09% 4,083 2.83% 2.95% 3.03% 2.94% 2.29% 1.71% 1.70% 1.81% 1.47% 31-Mar-17 31-Mar-18 31-Mar-19 31-Mar-20 31-Dec-20 31-Mar-17 31-Mar-18 31-Mar-19 31-Mar-20 31-Dec-20
Slide 38: Asset Quality Position - Movement Over the Years
ASSET QUALITY POSITION – MOVEMENT OVER THE YEARS (RS IN MN) FY MAR-16 FY MAR-17 FY MAR-18 FY MAR-19 FY MAR-20 Q3 FY 21 9M FY 21 NPA Opening balance 3,358 5,120 6,820 8,565 9,771 12,206 14,134 Additions A 4,290 4,796 5,749 6,322 11,104 0 34 Recovery / Sale to ARC 734 905 1,623 1,980 1,644 662 1,252 U
Slide 39: Restructured Accounts
RESTRUCTURED ACCOUNTS Quaterwise balance outstanding in respect of Restructured Standard borrowers Mar-20 Jun-20 Sep-20 Dec-20 Type of Restructuring No. of No. of No. of No. of Amt Amt Amt Amt Borrowers Borrowers Borrowers Borrowers MSME 104 2813 120 3664 131 4550 191 7851 Non – M S M E 47 158 46 21
Slide 40: Security Receipts
SECURITY RECEIPTS Balance outstanding of Security Receipts wrt NPA sold to ARC Period ended Amount (in INR Mn) Mar-19 3250 Mar-20 2474 Dec-20 1444 No fresh sale to ARC on SR basis from FY 17-18. In the FY 13-14 & 14-15, we had sold some of the NPA accounts to ARC on SR basis to the tune of Rs.3,747
Slide 41: Investments - At a Glance
INVESTMENTS – AT AGLANCE Investments Breakup and Categorywise (in INR Mn) Particulars DEC 2020 DEC 2019 SLR Securities 93,850 87,612 Non-SLR Securities 1,989 3,363 Total Investments 95,839 90,975 Yield on Investments 5.89% 6.74% Investments Breakup: -A FS 6,172 (6%) 17,754 (20%) - HTM 89,667 (94%) 7
Slide 42: Covid 19 Outbreak
COVID 19 OUTBREAK 41
Slide 43: COVID-19: Update on Current Situation
COVID-19 : Update on current situation The growth rate of Covid-19 cases is decreasing in our country. The total registered cases in our country is about 10.73 million out of about 80+ million cases worldwide. But the recovery rate in India is the highest in the world – over 96% and as a result, t
Slide 44: COVID-19: Measures Taken by the Bank
COVID-19 : Measures taken by the Bank Business continuity: Our Business continuity plans worked well during this tough situation. We were successfully relocated some of our key functional departments on temporary basis and restored back on a smooth basis with uninterrupted service to our customers
Slide 45: COVID-19: Status of Loan Accounts
COVID-19 : Status of Loan Accounts as of 29th Feb 2020 Present outstanding balance of the accounts which are in default as of 29th Feb 2020 is as below: Position as on 15.06.2020 Position as on 31.10.2020 Position as on 31.01.2021 (Rs in Cr) No. of A/cs O/s Amount No. of A/cs O/s Amount No. of A/c
Slide 46: COVID-19: Repayment Status of Accounts
COVID-19 : Repayment Status of Accounts – Position as of 31st Dec 2020: We have given below status of repayment made by our borrowers instalment-wise from Sep-20 to Dec-20: Sept-2020 Oct-2020 Nov-2020 Dec-2020 Loan A/cs 94% 91% 89% 87% CCOD A/cs 97% 94% 93% 92% Total 95% 93% 91% 89% The above workin
Slide 47: COVID-19: Bank's Position
COVID-19 : Bank’s position Liquidity Business segments Business growth Capital adequacy CRAR stood at 17.39% Maintaining LCR above Strong Retail Franchise Deposits grown by over (without taking 9M Net 200% (296% as of Rs.1,800 cr during Q3 FY profit). If we consider the 31.12.2020). No Cer
Slide 48: Branch Network
BRANCH NETWORK 47
Slide 49: Strong Presence in the South
STRONG PRESENCE IN THE SOUTH As of Dec 2020 - 700 branches. 628 branches are located in South India out of which 485 in Tamil Nadu No. of % of % of % of State Branches Deposits Advances Business Tamil na du 485 79 64 72 Karnata ka 41 7 5 7 Andhraprades h 45 2 8 5 1 3 Tel engana 33 3 6 4 2 8 Ma hara
Slide 50: Shareholding Pattern
SHAREHOLDING PATTERN CLIANTORIAM L\
Slide 51: A Well Diversified Investor Base
A WELL DIVERSIFIED INVESTOR BASE Position as on 31-Dec-2020 Major Institutional Shareholders SHAREHOLDERS HOLDING % QIB, NRI, 5.24 1.29 HDFC Midcap Opportunities Fund 4.48 Life Insurance Corporation of India 4.13 Corp Bodies, Others, 3.58 0.75 Axis Mutual Fund 3.63 Franklin India Prima Fund 2.96 SBI
Slide 52: Corporate Governance
CORPORATE GOVERNANCE JIT TARA Aer
Slide 53: A Well Experienced and Strong Board
A WELL EXPERIENCED AND STRONG BOARD Shri. R. Mohan | B.Sc., MBA, CAIIB Dr N. Kamakodi | B.Tech., MBA., PhD., CAIIB Non-Executive Chairman M.D. & C.E.O. Shri. R. Mohan is qualified as bachelor of Science, Master of Business Dr. N. Kamakodi is serving as MD & CEO of the Bank from May 2011. He Administ
Slide 54: Transparent Corporate Governance Practices
TRANSPARENT ‘CORPORATE GOVERNANCE’ PRACTICES Board consists Various of 8 Independent committees of Code of conduct Directors (including Board functions Disclosure norms KYC / AML for Directors and 1 WomenDirector) to oversee the strictly adhered to Norms strictly Senior Management And 1 Executive op
Slide 55: City Union Bank Ltd - Investor Contact
CITY UNION BANK LTD Regd.Office :149,TSR Big Street,Kumbakonam – 612001,Tamilandu. Admin Office :"Narayana" No.24 B,Gandhi Nagar,Kumbakonam - 612001,Tamil Nadu. Tel :0435-2402322,2401622,| FAX:0435-2431746 | www.cityunionbank.com INVESTOR CONTACT Name :K.Jayaraman,GM & CRO Mob : +91 9344303740 Email