State Bank Of India · NSE:SBIN
State Bank Of India — FY2020 Earnings Presentation
48 slides from State Bank Of India's earnings presentation, Jun 5, 2020
Slide 1: FY20 Analyst Presentation
FY20 Analyst Presentation 05.06.2020
Slide 2: Safe Harbor
Safe Harbor Certain statements in these slides are forward-looking statements. These statements are based on Management's current expectations and are subject to uncertainty and changes in circumstances. Actual outcomes may differ materially from those included in these statements due to a variety o
Slide 3: Performance Highlights
Performance Highlights Financial Performance & Business Key strengths and strategy COVID-19: Fully equipped to meet the challenge
Slide 4: Key Indicators
Key Indicators Rs. in Crores YoY CASA FY19 FY20 Growth 7.56% 9.99% Net Interest Income 88,349 98,085 11.02% 2,17,415 11,93,566 Net Interest Margin – 2,02,134 2.95 3.19 24 bps 10,85,151 Domestic (%) Profit & Loss Operating Profit 55,436 68,133 22.90% (in Rs. Crore) Profit Before Tax 1,607 25,063 1459
Slide 5: Financial Performance & Business
Performance Highlights Financial Performance & Business Key strengths and strategy COVID-19: Fully equipped to meet the challenge
Slide 6: Financials – At a Glance
Financials – At a Glance Rs. in Crores Quarter Ended Year Ended Growth (%) Q4FY20 Q4FY20 FY20 over Q4FY19 Q3FY20 Q4FY20 FY19 FY20 over over FY19 Q3FY20 Q4FY19 Interest Income 62,985 67,692 62,681 2,42,869 2,57,324 -7.40 -0.48 5.95 Interest Expenses 40,032 39,913 39,914 1,54,520 1,59,239 0.00 -0.29 3
Slide 7: Total Income
Total Income Rs. in Crores Quarter Ended Year Ended Growth (%) Q4FY20 Q4FY20 FY20 over Q4FY19 Q3FY20 Q4FY20 FY19 FY20 over over FY19 Q3FY20 Q4FY19 Interest on Loans 42,628 48,063 42,580 1,61,640 1,79,749 -11.41 -0.11 11.20 Interest on Resources 18,313 17,968 18,265 75,585 71,125 1.65 -0.26 -5.90 Oth
Slide 8: Fee Income Break Up
Fee Income Break Up Rs. in Crores Quarter Ended Year Ended Growth (%) Q4FY20 Q4FY20 FY20 Q4FY19 Q3FY20 Q4FY20 FY19 FY20 over over over Q3FY20 Q4FY19 FY19 Loan Processing Charges 1,502 1,120 1,924 3,710 4,426 71.81 28.09 19.31 Commission on Govt. Business 1,118 972 914 3,974 3,742 -5.96 -18.23 -5.84
Slide 9: Total Expenses
Total Expenses Rs. in Crores Quarter Ended Year Ended Growth (%) Q4FY20 Q4FY20 FY20 over Q4FY19 Q3FY20 Q4FY20 FY19 FY20 over over FY19 Q3FY20 Q4FY19 Interest on Deposits 35,607 37,182 37,168 1,40,272 1,47,399 -0.04 4.38 5.08 Interest on Borrowings 3,223 1,521 1,424 9,839 6,891 -6.37 -55.81 -29.96 Ot
Slide 10: Overhead Expenses
Overhead Expenses Rs. in Crores Quarter Ended Year Ended Growth (%) Q4FY20 Q4FY20 FY20 Q4FY19 Q3FY20 Q4FY20 FY19 FY20 over over over Q3FY20 Q4FY19 FY19 Rent, Taxes and Lighting 1,480 1,322 1,475 5,266 5,339 11.56 -0.34 1.40 Depreciation 831 815 901 3,212 3,304 10.57 8.48 2.85 Printing and Stationery
Slide 11: Provisions & Profit
Provisions & Profit Rs. in Crores Quarter Ended Year Ended Growth (%) Q4FY20 Q4FY20 FY20 over Q4FY19 Q3FY20 Q4FY20 FY19 FY20 over over FY19 Q3FY20 Q4FY19 Operating Profit 16,933 18,223 18,465 55,436 68,133 1.33 9.05 22.90 Loan Loss 17,336 8,193 11,894 54,529 42,776 45.17 -31.39 -21.55 Standard Asset
Slide 12: Costs, Yields and Margins (Cumulative)
Costs, Yields and Margins (Cumulative) Yield on Advances (%) Net Interest Margin (%) 8.56 8.69 8.91 8.72 8.49 NIM – Domestic Ops 3.27 3.19 3.11 3.01 2.95 3.71 3.70 3.59 3.51 3.29 NIM – Overseas Ops Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Cost of Deposits (%) 1.32 1.18 1.20 1.20 1.18 5.10 5.07 5.02 4.97 4
Slide 13: Asset Quality (1/3)
Asset Quality (1/3) Rs. in Crores Gross NPA Net NPA 1,72,750 1,68,494 1,61,636 1,59,661 65,895 65,624 1,49,092 59,939 58,249 51,871 Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Gross NPA Ratio (%) 7.53 7.53 7.19 6.94 6.15 Net NPA Ratio (%)
Slide 14: Asset Quality (2/3)
Asset Quality (2/3) Rs. in Crores Movement of NPAs: Q4FY19 FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 FY20 Opening Level of Gross NPAs 1,87,765 2,23,427 1,72,750 1,68,494 1,61,636 1,59,661 1,72,750 Total Reductions 22,976 90,417 21,251 15,984 22,073 18,860 78,168 of which : Recovery + Upgradation 5,712 31,512
Slide 15: Asset Quality (3/3)
Asset Quality (3/3) As on Mar 2020 Rs. in Crores Fresh FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 FY20 SMA 1 & SMA 2 Slippages 18,313 Corporate 10,056 5,354 3,239 9,467# 1,561 19,621# SME 9,478 3,964 1,522 1,578 227 7,291 7,632 AGRI 8,978 4,239 3,078 2,965 5,238 15,520 8,101 7,762 7,266 2,766 3,677 PER 3,976
Slide 16: Key strengths and strategy
Performance Highlights Financial Performance & Business Key strengths and strategy COVID-19: Fully equipped to meet the challenge 16
Slide 17: COVID-19 – Response so far
COVID-19 – Response so far SBI employees donated Rs. 108 1 crore to PM Cares Fund Employees availed Protecting health & 38% Work from Home Pledged Rs. 30 cr for COVID related safety of Employees, 2 CSR activities through SBI Foundation Clients & Community Robust protective measures (sanitisation, ~2
Slide 18: Key strengths and strategy
Strong liability franchise with a customer base of ~49 cr – more than the population of United States 1 Supported by unmatched distribution network and digital capabilities – Our greatest strength Consistent growth in operating income and core PPOP - CAGR of 9.5% and 9.6% 2 respectively over FY18 –
Slide 19: COVID-19: Challenges
Asset Quality Likely job cuts and salary reductions, however relatively low level of stress on account of Retail higher proportion of govt/ quasi govt. sector customers Low level of economic activity and reduction in repayment capacity; likely decline in value SME of collateral Have cleaned a signif
Slide 20: COVID-19: Opportunities
Retail Agri MSME ▪ Robust growth in deposits - ▪ One time settlement policy ▪ Intensive monitoring; early flight to safety to be revamped and warning signals being liberalized closely tracked ▪ Robustness of our retail portfolio is established as ▪ Leverage BC channel for ▪ Industry specific action
Slide 21: Strong Liability Franchise
Liability Operating Cost Loan Portfolio Capital Position Digital Platform Franchise Performance Optimization We serve more clients than the population of US; capability to serve entire Indian subcontinent – peak 1 transactions per second (TPS) of 9831, capacity to handle 23,000 TPS 2 We open ~70,000
Slide 22: Robust Operating Performance
Liability Operating Cost Loan Portfolio Capital Position Digital Platform Franchise Performance Optimization Core PPoP of Rs. 61,918 cr in FY20, up from Rs. 51,505 cr in FY18 – CAGR of 9.6% over 1 FY18-20; Core PPoP/ Credit cost ratio doubled over FY18-20 to 1.45x Strong growth in Net Interest Incom
Slide 23: Diversified Loan Portfolio
Liability Operating Cost Loan Portfolio Capital Position Digital Platform Franchise Performance Optimization Diversified loan portfolio – 38.9% of corporate loans to PSUs/ Govt. depts, 60.8% of personal retail to 1 low risk mortgages; > 95% of unsecured personal lending to government/PSU employees L
Slide 24: Loan Portfolio - Collections
Liability Operating Cost Loan Portfolio Capital Position Digital Platform Franchise Performance Optimization Strengthening Collections in rural areas through BC/BF network; leveraging branches and 1 call centers in metro/urban areas 2 Partnership with FinTechs to source alternate data for monitoring
Slide 25: Comfortable Capital Position
Liability Operating Capital Cost Loan Portfolio Digital Platform Franchise Performance Position Optimization CET 1 ratio of 9.77% well above regulatory minimum, demonstrated ability to comfortably raise 1 capital through various avenues in the past 2 Provision Coverage Ratio of 83.7% up 1745 bps YoY
Slide 26: Leading Digital Platform
Liability Operating Cost Loan Portfolio Capital Position Digital Platform Franchise Performance Optimization Digital Leadership across channels – Mobile Banking market share of 23.2%; 1 Internet Banking transactions value in excess of Rs 35,000 cr/ per day YONO Retail – 40% of incremental deposits t
Slide 27: Cost Optimization
Liability Operating Cost Loan Portfolio Capital Position Digital Platform Franchise Performance Optimization Successfully controlled overheads – CAGR of 4.9% over FY18-20; staff cost (ex- pension and 1 gratuity provisions) controlled – CAGR of 5.8% over FY18-20 Cost to assets at 1.9%, significantly
Slide 28: Way Forward
Way forward – Asset Quality Constant vigil on the emerging stress and proactive action, including rephasement of term loan installments and deep restructuring wherever required Strong monitoring & collection mechanism; use digital and analytical capabilities to originate, sanction and monitor Retail
Slide 29: Way Forward
Further scale up YONO – target of doubling user registrations in the next six 1 months and further strengthen platform – new product offerings like end to end home loans, pre-approved car loan etc; Special PAPL and personal gold loans have received excellent response HR way forward ▪ Redeploying emp
Slide 30: Additional Information
Additional Information 30
Slide 31: Strong Liability Franchise
Strong Liability Franchise Domestic Deposits Mar 19 Mar 20 CA, 7.18% CA, 6.96% SA, SA, 38.56% TD, 54.26% 38.20% TD, 54.84% CASA: 45.74% CASA: 45.16% Rs. in Crores Mar 19 Mar 20 YoY Growth (%) Current Account 2,02,134 2,17,415 7.56 Saving Bank 10,85,151 11,93,566 9.99 CASA 12,87,285 14,10,981 9.61 Te
Slide 32: Diversified Loan Portfolio
Diversified Loan Portfolio Domestic Advances Mar 19 Mar 20 Per, 32.54% Per, 36.19% Agri, 10.18% Agri, 9.98% Corporates, Corporates, SME, 14.50% 42.78% 40.87% SME, 12.96% Retail: 57.22% Retail: 59.13% Rs. in Crores Mar 19 Mar 20 YoY Growth (%) Retail Per 6,47,844 7,47,589 15.40 Agri 2,02,681 2,06,067
Slide 33: Retail Per Banking
Retail Per Banking Leadership across all segments As on Mar 2020 Personal Retail Portfolio of Rs 7.5 lakh crore NPA ratio at 1.06% % of Dom. Adv. FY19: 32.54 FY20: 36.19 Home Xpress Other P Seg Auto Loans Loans Credit Loans O/S, 77,819 4,55,865 72,662 1,41,243 In Rs cr YoY 13.86 1.08 34.64 10.11 Gro
Slide 34: Diversified Loan Portfolio
Diversified Loan Portfolio High quality asset book with lower exposure to high risk sectors Corporate Rating mix Industry mix Outstanding as on 31st Mar 20 Mar-20 Fund Based O/S Sectors Amount % Share YOY Gr % Infrastructure 3,43,523 16.63 -2.52 of which: Power 2,03,532 9.85 1.98 Telecommunication 3
Slide 35: Treasury Operations
Treasury Operations MAR 19 AFS Book MAR 20 Corporate Others, 7.0% Others, 11.3% Bonds, 18.2% Corporate G-Sec and T G-Sec and T Bill, Bonds, 23.7% Bill, 42.2% 49.7% SDLs, 15.9% SDLs, CP, 9.6% 9.3% CP, 13.5% Modified Duration: 2.62 Modified Duration: 2.06 Break up of Domestic Investments (%) Total Inv
Slide 36: International Banking Group
International Banking Group (Amt in INR Cr.) Gross Advances: Healthy Credit Growth Diversified Loan Portfolio USA 3,57,360 3% 9% UK 4% Hongkong 24% Singapore 4% Bahrain 4% UAE 3,02,013 3,02,708 5% Japan Australia 8% 21% Belgium Gift City (India) 8% Mar 18 Mar 19 Mar 20 11% Others Asset Quality: NPAs
Slide 37: SBI remains a well-capitalized bank with adequate liquidity
SBI remains a well-capitalized bank with adequate liquidity Tier II Capital ratios (%) LCR (%) AT1 Tier I CET1 12.60% 12.72% 13.06% 146.8 151.47 2.06 133.99 134.41 2.24 2.07 106.05 1.03 1.23 100 0.68 Minimum requirement Mar 19 June19 Sep 19 Dec 19 Mar 20 RWA to Total Assets (%) 11.00 10.36 10.65 9.6
Slide 38: Well provided on legacy NPAs
Well provided on legacy NPAs Mar 2020 Credit costs below 2.0% in FY20 Particulars • 35% of provisions for fresh slippages As % of total PCR without GNPA AUCA (%) • 65% of provisions due to ageing requirements Total Corporate 54.75 78.37 • Large accounts have been resolved IBG 1.11 75.85 through NCLT
Slide 39: NBFC & FI Sector
NBFC & FI Sector Loans to PSUs and High Quality Private Sector As on Mar 2020 Rs. in Crores NBFC & FI Portfolio Classification Housing Finance Companies NBFCs 1,78,891 1,78,891 65,712 1,13,179 38,580 Backed by PSUs' 30% 25% 66,302 Housing Finance Backed by large Companies Pvt Sector Institutions 26,
Slide 40: Accelerating digital agenda (1/3)
Accelerating digital agenda (1/3) YONO – Our flagship digital offering 2.1 Cr+ 66%+ 30 L+ 4K+ 14,000 Cr Registered customers Monthly active users Daily Active Users # of disbursals per day Digital loans disbursed YONO: The digital bank with a customer base almost equal to the population of Australia
Slide 41: Accelerating digital agenda (2/3)
Accelerating digital agenda (2/3) Higher branch productivity via YONO Product Redesigned journey Impact Account “Account opening and activation in 21K 80% opening <10 minutes” New accounts per day Productivity improvement Personal Loans “3 click instant disbursal” ~1,000 Cr 4,000+ Monthly disbursal
Slide 42: Accelerating digital agenda (3/3)
Accelerating digital agenda (3/3) Digital Leadership across channels Market share (As per latest available data) Mobile Banking Mobile Banking Debit card spends POS terminals ATMs No. of Transactions Transaction value 29.42% 13.43% 27.82% 23.23% 19.38% Presence across multiple channels and payment a
Slide 43: Financial Inclusion & Micro Markets
Financial Inclusion & Micro Markets As on Mar 2020 Accounts & Amount in FI Channel Transactions in BC Channel (No. in Crores) (No. & Amt. in Crores) No. of Accounts 15.53 49.29 14.25 2,50,000 39.75 2,27,469 42.00 10.97 12.05 2,00,000 32.00 1,73,381 1,50,000 3.28 3.48 22.00 Mar 19 Mar 20 1,00,000 12.
Slide 44: SBI and its Subsidiaries
SBI and its Subsidiaries Leveraging Synergies As on Mar 2020 • Increase in share of Protection NBP from 11.9% to 12.5% with 27% growth • Rank 1st in QAAUM with Market Share of 13.82%. • Private market leadership Rank 1 in Individual Rated Premium (IRP) with 9% growth • AUM at Rs.374K Crores, up by 3
Slide 45: SBI Group Financials – FY20
SBI Group Financials – FY20 Rs. In crores Year Ended Growth Rs. In crores Year Ended (%) FY19 FY20 YoY FY19 FY20 Interest Earned 2,53,322 2,69,852 6.53 ROA (%) 0.06 0.49 Non-Interest Income 77,365* 98,159* 26.88 Total Income 3,30,687 3,68,011 11.29 ROE (%) 1.23 9.86 Interest Expended 1,55,867 1,61,1
Slide 46: Balance Sheet
Balance Sheet Liabilities Rs. in Crores SBI SOLO SBI GROUP YOY YOY Mar 19 Mar 20 Mar 19 Mar 20 Growth (%) Growth (%) Capital 892 892 0.00 892 892 0.00 Reserves and Surplus 2,20,021 2,31,115 5.04 2,33,603 2,50,168 7.09 Minority Interest 6,037 7,944 31.59 Deposits 29,11,386 32,41,621 11.34 29,40,541 3
Slide 47: SBI's ESG Practices
SBI’s ESG Practices ‘Environmental’ Practices ‘Governance’ Practices ▪Average training hours per Full time employee stood at ▪Big push to digitalization. As on March 2020, 56.23 hrs for the FY 2019-20 compared to 54 hrs last almost 90.12 % Bank’s total transactions took ▪‘Sustainability’ incorporate
Slide 48: Thank You
Thank You