MUMBAI, 15 MAY, 2020 (GPN): Bank makes provisions in excess of RBI prescribed norms

COVID-19 provision at Rs. 996.30 Mn as of March 31, 2020

PAT for FY20 at Rs. 2,436.35 Mn as against Rs. 2,105.66 Mn in FY19, growth of 15.70%

Cost to Income* improved by 390 basis points from 70.30% in FY19 to 66.38% in FY20

FY20 Highlights:

1. Key Highlights for FY20:

• Advances^{^}:

o   Disbursement for FY20 grew 15.54% YoY to Rs. 99,110.73 Mn from Rs. 85,783.11 Mn in FY19

o   Advances^{^} as of March 31, 2020 grew 31.29% YoY to Rs. 1,53,669.45 Mn

• Liabilities:

o   Deposits excluding CD at Rs. 1,02,999.91 Mn, growth of 25.69% YoY

o   Retail TD at Rs. 38,112.87 Mn as on 31st March 2020, growth of 132.93% YoY

o   CASA stood at Rs. 22,082.13 Mn, CASA as a % of Total Deposits at 21.44%

• Key Ratios:

o   Cost to Income* improved by 390 basis points from 70.30% in FY19 to 66.38% in FY20

o   RoA^ and RoE# for FY20 at 1.39% and 9.84% respectively vs. 1.45% & 9.85% in FY19

^Advances = Gross Advances including IBPC issued |NIM = Net interest income as a % of avg. income earning assets | Total Deposits = Deposits excluding CD| *Cost to income ratio is calculated as a ratio of Operating expenses divided by Net Operating Income (Net Operating Income is a sum of net interest income and other income) ^RoA – ratio of the net profit for the period/year total average assets | ^#Ratio of the net profit for the period/ to the average shareholders’ Equity | ^$GNPA including IBPC

• Capital:

o   As of March 31, 2020 Total CRAR at 23.61% and Tier-I CRAR of 22.44%; Well above minimum regulatory requirements of 15% and 7.5%

o   Tier II Capital at 1.17%

• Liquidity:

o   Bank has undertaken Inter-Bank Participation Certificates (IBPCs) with a mix of PSL/Non-PSL advances which further enhances the liquidity of the Bank

o   Liquidity Coverage Ratio (LCR)^$ as on 31.03.2020 at 132.2% much above the minimum regulatory requirement of LCR at 90%

2. Profit & Loss:

• Net Interest Income for FY20 at Rs. 14,953.06 Mn as against Rs. 11,517.34 Mn in FY19, growth of 29.83%, NIM* at 9.11%
• PBT before provisions and write off for FY20 at Rs. 5,975.79 Mn as against Rs. 4,261.45 Mn in FY19, growth of 40.23%
• Provisions for FY20 at Rs. 2,466.39 Mn, including Rs. 996.30 Mn COVID-19 provision (including Rs. 29.8 Mn representing the minimum provision of 10% on standard assets availing moratorium where asset classification benefit is extended. The provision held by banks are in excess of the RBI prescribed norms.
• PAT for FY20 at Rs. 2,436.35 Mn as against Rs. 2,105.66 Mn in FY19, growth of 15.70%
• Cost to Income* improved by 390 basis points from 70.30% in FY19 to 66.38% in FY20
• RoA^ and RoE# for FY20 at 1.39% and 9.84% respectively vs. 1.45% & 9.85% in FY19

3. Balance Sheet:

• Advances^{^} as of March 31, 2020 grew 31.29% YoY to Rs. 1,53,669.45 Mn

o   Micro Finance grew by 17.81% YoY from Rs. 30,696.02 Mn in FY19 to Rs. 36,161.60 Mn in FY20

o   Small Business Loans (Incl. HF) grew by 37.19% YoY from Rs. 45,771.21 Mn in FY19 to Rs. 62,794.36 Mn in FY20

o   Vehicle Finance grew by 27.41% YoY from Rs. 29,511.97 Mn in FY19 to Rs. 37,599.72 Mn in FY20

o   MSE Finance grew by 270.12% YoY from Rs. 1,808.61 Mn in FY19 to Rs. 6,694.10 Mn in FY20

o   Corporate Loans grew by 79.43% YoY from Rs. 4,559.65 Mn in FY19 to Rs. 8,181.19 Mn in FY20

^Advances = Gross Advances including IBPC issued |NIM = Net interest income as a % of avg. income earning assets | Total Deposits = Deposits excluding CD| *Cost to income ratio is calculated as a ratio of Operating expenses divided by Net Operating Income (Net Operating Income is a sum of net interest income and other income) ^RoA – ratio of the net profit for the period/year total average assets | ^#Ratio of the net profit for the period/ to the average shareholders’ Equity | ^$GNPA including IBPC | $ – LCR as on 31.03.2020

• Disbursements for the year grew 15.54% YoY to Rs. 99,110.73 Mn
• 75.39% of the overall advances^{^} is secured loans

4. Liabilities & Branch Banking:

• Deposits excluding CD at Rs. 1,02,999.91 Mn, growth of 25.69% YoY
• Retail TD at Rs. 38,112.87 Mn as on 31st March 2020, growth of 132.93% YoY
• CASA stood at Rs. 22,082.13 Mn, CASA as a % of Total Deposits at 21.44%

5. Asset Quality:

• GNPA^$ at 2.72% in FY20 as compared to 2.53% in FY19
• NNPA at 1.66% in FY20 as compared to 1.44% in FY19. ENDS

About Equitas Small Finance Bank Limited [ESFBL]

Equitas Small Finance Bank Limited is the largest SFB in India in terms of number of banking outlets, and the second largest SFB in India in terms of assets under management and total deposits in Fiscal 2019. (Source: CRISIL report). Its focus customer segments include individuals with limited access to formal financing channels on account of their informal, variable and cash-based income profile. It offers a range of financial products and services that address the specific requirements of these customer segments by taking into account their income profile, nature of business and type of security available. Its asset products are suited to a range of customers with varying profiles.