City Union Bank Limited · NSE:CUB
City Union Bank — Investor Presentation (June 2020)
49 slides from City Union Bank's investor presentation, June 2020
Slide 1: June 2020
JUNE 2020
Slide 2: 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 3: Table of Contents
TABLE OF CONTENTS 4 10 14 Overview Performance Highlights – Financial Performance & June 2020 Business Profile 36 42 44 46 Covid Outbreak Branch Network Shareholding Pattern Corporate Governance 3
Slide 4: Overview
OVERVIEW 4
Slide 5: 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 6: 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 7: A Specialized Banking Model Aligned to Target Segment – 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 8: 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 9: 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 10: Performance Highlights – June 2020
PERFORMANCE HIGHLIGHTS – JUNE 2020 10
Slide 11: Q1 FY 2021 Performance – A Snapshot
Q1 FY 2021 PERFORMANCE – A SNAPSHOT Deposits increased by 5% from Rs.391 Bn to Rs.410 Bn Y-o-Y Advances registered a growth of 7% from Rs.322 Bn to Rs.345 BnY-o-Y Total business grown by 6% from Rs.713 Bn to Rs.755 Bn Y-o-Y Gross Profit marginally increased by 1% to Rs.3,560 Mn from Rs.3,514 Mn (Y-o
Slide 12: Q1 FY 2021 vs Q1 FY 2020 Performance – A Snapshot
Q1 FY 2021 VS Q1 FY 2020 PERFORMANCE – A SNAPSHOT (in INR Mn) 410,259 345,356 755,615 100,976 5% 7% 6% 10% 390,768 322,295 713,063 91,613 Deposits Advances Total Business CASA 3,560 1,540 4,369 40.42% 1% -ve 5% % 3,514 1,856 4,169 39.43% Gross Profit Net Profit Net Interest Cost to Income Income 1.2
Slide 13: FY 2020 vs FY 2019 Performance – A 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 14: Financial Performance & Business Profile
FINANCIAL PERFORMANCE & BUSINESS PROFILE 14
Slide 15: Q1 FY 21 vs Q1 FY 20 Performance - A Snapshot
Q1 FY 21 VS Q1 FY 20 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q1 FY 2021 Q1 FY 2020 INC / (DEC) Growth Growth % Deposits 410,259 390,768 19,491 5% Advances 345,356 322,295 23,061 7% Total Business 755,615 713,063 42,552 6% Demand Deposits 28.946 28,532 414 1% Saving Dep
Slide 16: Q1 FY 21 vs Q1 FY 20 Performance - A Snapshot
Q1 FY 21 VS Q1 FY 20 PERFORMANCE - A SNAPSHOT (in INR Mn) FINANCIAL PERFORMANCE PARTICULARS Q1 FY 2021 Q1 FY 2020 INC / (DEC) Growth % Q4 FY 2020 Net Interest Income 4,369 4,169 200 5% 4,195 Other Income 1,606 1,633 -27 -ve 1,793 Operating Expenses 2,415 2,288 127 6% 2,637 Gross Profit 3,560 3,514 4
Slide 17: FY 20 vs FY 19 Performance - A 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 18: FY 20 vs FY 19 Performance - A 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 19: Provisions & Contingencies – Breakup
PROVISIONS & CONTINGENCIES – BREAKUP (in INR Mn) PARTICULARS Q1 FY 21 Q1 FY 20 FY 19-20 FY 18-19 Q4 FY 20 Provision for: - Tax 450 500 1,100 2,420 -200 - Bad Debts 500 1,440 6,310 2,700 3,105 - Covid 19 1,000 - 1,250 - 1,250 - Standard Assets 40 -37 193 215 80 - Depn on Investments - -240 -317 160 3
Slide 20: Q1 FY 21 vs Q1 FY 20 – Income and Expenses Breakup
Q1 FY 21 VS Q1 FY 20 – INCOME AND EXPENSES BREAKUP (in INR Mn) INTEREST INCOME BREAKUP INTEREST EXPENSES BREAKUP Q1 FY Q1 FY Q1 FY Q1 FY PARTICULARS Growth % PARTICULARS Growth % 2021 2020 2021 2020 Interest on Loans 8,922 8,686 3% Int Exp on Deposits 5,899 5,945 -ve Interest on Investments 1,400 1,
Slide 21: 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 22: Strong Deposits and Advances Growth
STRONG DEPOSITS AND ADVANCES GROWTH (in INR Mn) DEPOSITS ADVANCES 11% 13% CAGR 408,325 410,259 CAGR 345,762 345,356 384,480 330,652 328,526 282,386 301,157 241,125 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 30-JUN-2020 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 30-JUN-2020 BUSINESS CASA 12
Slide 23: 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 11,988 6,799 4,840 5,321 5,144 4,369 (3M) 1,606 (3M) 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 30-JUN-2020 31-MAR-2017 31-MAR-2018 31-MAR-2019 31-MAR-2020 30-JUN-2020
Slide 24: Key Business Indicators
KEY BUSINESS INDICATORS PARTICULARS Q1 FY 21 Q1 FY 20 Q4 FY 20 FY 19-20 FY 18-19 Cost of Deposits 5.89% 6.27% 6.07% 6.20% 6.17% Yield on Advances 10.41% 10.97% 10.46% 10.76% 10.95% Yield on Investments 6.12% 6.93% 6.54% 6.69% 6.95% Net Interest Margin 3.98% 4.11% 3.91% 3.98% 4.32% Cost to Income 40.
Slide 25: 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% 3.98% 3.98% 1.40% 4.00% 1.30% 1.23% 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 30-JUN-20 31-MAR-17 31-MAR-18 31-MAR-19 31-
Slide 26: 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 10.41 10 8.44 8.37 8.15 8.11 7.62 8 6.94 6.82 6.29 6.17 6.20 5.89 6 4 2 0 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Jun 20 Spread between cost of deposits and
Slide 27: Efficiency
EFFICIENCY COST INCOME RATIO (%) CASA RATIO (%) 25.22 43.04 24.97 41.67 24.61 40.94 24.22 40.42 23.37 38.46 31-Mar-2017 31-Mar-2018 31-Mar-2019 31-Mar-2020 30-Jun-2020 31-Mar-2017 31-Mar-2018 31-Mar-2019 31-Mar-2020 30-Jun-2020 BUSINESS PER EMPLOYEE PROFIT PER EMPLOYEE (in INR Mn) (in INR Mn) 131.32
Slide 28: Loan Book – Products Composition
LOAN BOOK – PRODUCTS COMPOSITION % toTotalAdvances 1% Working capital loans yielding higher interest constitute 59% of advances Bills Purchased & Bills Discounted Term Loan Re-pricing possible at short intervals thus reducing interest rate risk 40% Cash Credit & Demand Loan ~95% of our loan book is
Slide 29: Loan Book Sectoral Deployment – Position as on 30.06.2020
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 30.06.2020 (in INR Mn) Loans collateralized by Deposits 5,173 Retail Traders Infrastructure 7,803 3,687 JL Non-Agri 1% NBFC 8,211 2% 2,485 Other Personal Loans 2% 9,860 3% Large Industries 21,784 6% Housing Loans 7% 22,857 32% M S M E 110,298 SECTORAL D
Slide 30: Loan Book Sectoral Deployment – Secured & Unsecured Advances
LOAN BOOK SECTORAL DEPLOYMENT – POSITION AS ON 30.06.2020 (in INR Mn) SECURED & UNSECURED ADVANCES Particulars Amount (INR Mn) (%) Secured Loans 342,718 99% Unsecured Loans 2,638 1% Total 345,356 100% Trading & MSME loans earning higher yield constitute about 47% Diversified credit portfolio reduces
Slide 31: Loan Book – Advances to Major Industries
Corporate Governance Loan Book – Advances to Major Industries (in I N R M n) Advances to Major Industries 30th June 2020 TEXTILE a) Cotton 16,823 (5%) b) Other Textiles 20,903 (6%) METALS a) Iron & Steel 10,685 (3%) Amount % to Total b) Other Metals 5,419 (1%) Industry Name (in INR Mn) Advances PAPE
Slide 32: Asset Quality
ASSET QUALITY (in INR Mn) GROSS NPA QTM & GROSS NPA % NET NPA QTM & NET NPA % 14,134 13,461 7,785 7,164 5,915 9,771 8,566 4,748 6,820 4.09% 4,083 3.90% 2.83% 2.95% 3.03% 2.29% 2.11% 1.71% 1.70% 1.81% 31-Mar-17 31-Mar-18 31-Mar-19 31-Mar-20 30-Jun-20 31-Mar-17 31-Mar-18 31-Mar-19 31-Mar-20 30-Jun-20
Slide 33: 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 Q1 FY 21 NPA Opening balance 3,358 5,120 6,820 8,565 9,771 14,134 Additions A 4,290 4,796 5,749 6,322 11,104 34 Recovery / SR * 734 905 1,623 1,980 1,644 131 Upgradations 546 556 433 496 1,3
Slide 34: Restructured Accounts
RESTRUCTURED ACCOUNTS Balance outstanding as on 30.06.2020 in respect of Restructured Standard borrowers Type of Restructuring No. of Borrowers Amount (in INR Mn) SME 120 3663.57 NSME 46 216.48 Total 166 3880.05 The above disclosure is in respect of Restructured Standard Accounts excluding NPA Restr
Slide 35: Investments – At a Glance
INVESTMENTS – AT AGLANCE Investments Breakup and Categorywise (in INR Mn) Particulars JUN 2020 JUN 2019 SLR Securities 94,220 82,611 Non-SLR Securities 3,065 3,652 Total Investments 97,285 86,263 Yield on Investments 6.12% 6.93% Investments Breakup: -A FS 18,868 (19%) 20,988 (24%) - HTM 78,417 (81%)
Slide 36: Covid Outbreak
COVID 19 OUTBREAK 36
Slide 37: COVID-19: Update on Current Situation
COVID-19 : Update on current situation As predicted by experts, COVID-19 pandemic is at its peak right now and our country is in the 3rd position in the world with more than 2.27 million cases. However positive news are coming from around the world with vaccine which is expected to hit the market in
Slide 38: 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 39: COVID-19: Status of Loan Accounts as of 29th Feb 2020
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 31.07.2020 (Rs in Cr) No. of A/cs O/s Amount No. of A/cs O/s Amount SMA 0 571 175 471 204 SMA 1 1102 348 9
Slide 40: COVID-19: Repayment Status of Accounts – Position as of 30th Jun 2020
COVID-19 : Repayment Status of Accounts – Position as of 30th Jun 2020: We have given below status of repayment made by our borrowers instalment-wise (upto June 2020) since grant of moratorium: 1 monthly 2 monthly 3 monthly 4 monthly installment / installments / installments / installments / interes
Slide 41: COVID-19: Bank's Position
COVID-19 : Bank’s position Liquidity Business segments Business growth Capital adequacy Maintaining LCR above Strong Retail Franchise Deposits grown by Rs.193 CRAR stood at 16.77% 200% (270% as of cr during Q1 FY 21 30.06.2020). Maintaining higher capital No Certificate of Deposit Lesser quantum of
Slide 42: Branch Network
BRANCH NETWORK 42
Slide 43: Strong Presence in the South
STRONG PRESENCE IN THE SOUTH As of June 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 Ta mi l na du 485 80 63 72 Ka rna ta ka 41 6 5 6 Andhra pra des h 45 2 8 5 1 Tel enga na 33 3 6 4 3 2 Ma
Slide 44: Shareholding Pattern
SHAREHOLDING PATTERN 44
Slide 45: A Well Diversified Investor Base
A WELL DIVERSIFIED INVESTOR BASE Position as on 30-Jun-2020 Major Institutional Shareholders SHAREHOLDERS HOLDING % QIB, NRI, 4.42 1.05 HDFC Midcap Opportunities Fund 4.48 Life Insurance Corporation of India 4.13 Corp Bodies, Others, Smallcap World Fund INC (Capital Group) 4.07 3.68 0.84 Axis Mutual
Slide 46: Corporate Governance
— ~~ CORPORATE GOVERNANCE
Slide 47: 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 a bachelor of Science, Master of Business Administration Dr. N. Kamakodi is serving as MD & CEO of the Bank from May 2011. He and
Slide 48: Transparent 'Corporate Governance' Practices
TRANSPARENT ‘CORPORATE GOVERNANCE’ PRACTICES Board consists Various sub- of 9 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 Executi
Slide 49: City Union Bank Ltd. Contact Details
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,DGM Mob : +91 9344303740 Email :ja