Equitas Holdings Limited [EHL] announces the

Equitas Holdings Limited [EHL] announces the Q1FY21 financial performance (unaudited) of its subsidiary Equitas Small Finance Bank [ESFBL]

PBT before provision & Write-off at Rs. 146 Cr, growth of 19% YoY

Cumulative COVID provisions of Rs. 144.63 Cr

Moratorium Opt in % at 43% as of July 2020 from 51% as of June 2020

Retail TD at Rs. 4,377 Cr, growth of 96% YoY

Q1FY21 Highlights:

1.      Key Highlights for Q1FY21:

 ·         Advances^{^}:

o   Advances^{^} as of Q1FY21 was at Rs. 15,573 Cr, Advances^{^} growth of 27% YoY 

o   The Bank disbursed Rs. 564 Cr in Q1FY21

o   76% of advances* is secured loans

 ·         Liabilities:

o   Deposits excluding CD at Rs. 11,471 Cr as on 30th June 2020, growth of 30% YoY and 11% QoQ

o   Retail TD at Rs. 4,377 Cr as on 30th June 2020, growth of 96% YoY and 15% QoQ

o   Savings Account deposits at Rs. 2,024 as on 30th June 2020, growth of 9% QoQ

o   CASA stood at Rs. 2,354 Cr as on 30th June 2020, CASA as a % of Total Deposits at 21%

^Advances = Gross Advances including IBPC issued

o   All the Channels (TASC, CA, Corporate Salary, NR) started their full-fledged functioning in Jun’20

·         Key Ratios:

o   Cost to Income⁺ at 66.41% in Q1FY21 as compared to 69.09% in Q1FY20

o   RoA^{^} and RoE^# for Q1FY21 at 1.20% and 8.72% respectively

·         Capital:

o   As of June 30, 2020 Total CRAR at 21.59% and Tier-I CRAR of 20.61%; Well above minimum regulatory requirements of 15% and 7.5%

o   Tier II Capital at 0.98%

 ·         Treasury & 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 30.06.2020 at 139.4% much above the minimum regulatory requirement of LCR at 80%

o   Average cost of funds for Q1FY21 at 7.63%

2.      Profit & Loss:

o   Net Interest Income for Q1FY21 at Rs. 404 Cr as against Rs. 337 Cr in Q1FY20, NIM* at 8.63%

o   PBT before provisions and write off for Q1FY21 at Rs. 146 Cr as against Rs. 123 Cr in Q1FY20

o   During the quarter, Bank made provisions of Rs. 68.34 Cr including additional provision of Rs. 45 Cr for potential impact of COVID-19 in addition to Rs. 99.63 Cr COVID-19 provision created in last quarter.

o   The bank now carries Rs. 144.63 Cr of COVID-19 related provisions (other than Standard and NPA Provisions), which constitutes 0.93% of our total Gross Advances.

o   PAT for Q1FY21 at Rs. 60 cr as against Rs. 59 Cr in Q1FY20

NIM = Net interest income as a % of avg. income earning assets |⁺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 | RoE^# - Ratio of the net profit for the period/ to the average shareholders’ Equity

  3.      Balance Sheet:

 ·         Advances^{^} as of June 30, 2020 grew 27% YoY to Rs. 15,573 Cr

o   Micro Finance grew by 16% YoY from Rs. 3,124 Cr in Q1FY20 to Rs. 3,618 Cr in Q1FY21

o   Small Business Loans (Incl. HF) grew by 32% YoY from Rs. 4,926 Cr in Q1FY20 to Rs. 6,484 Cr in Q1FY21

o   Vehicle Finance grew by 25% YoY from Rs. 3,027 Cr in Q1FY20 to Rs. 3,776 Cr in Q1FY21

o   MSE Finance grew by 154% YoY from Rs. 280 Cr in Q1FY20 to Rs. 712 Cr in Q1FY21

o   Corporate Loans grew by 39% YoY from Rs. 555 Cr in Q1FY20 to Rs. 772 Cr in Q1FY21

4.      Liabilities & Branch Banking:

·         Deposits excluding CD at Rs. 11,471 Cr, growth of 30% YoY

·         Retail TD at Rs. 4,377 Cr as on 30th June 2020, growth of 96% YoY and 15% QoQ

·         Savings Account deposits at Rs. 2,024 as on 30^th June 2020, growth of 9% QoQ

·         CASA stood at Rs. 2,354 Cr as on 30th June 2020, CASA as a % of Total Deposits at 21%

 5.      Asset Quality:

·         GNPA^$ at 2.68% in Q1FY21 as compared to 2.72% in Q4FY20 and 2.73% in Q1FY20

·         NNPA^$ at 1.39% in Q1FY21 as compared to 1.50% in Q4FY20 and 1.54% in Q1FY20

6.      Moratorium Update:

Asset Products	As on June 2020	As on July 2020
	Opt in % of Gross Advances as on 31st March 2020	Opt in % of Gross Advances as on 30th June 2020
Micro Finance	59%	42%
Small Business Loans	42%	40%
New Commercial Vehicle Finance	65%	54%
Used Commercial Vehicle Finance	70%	60%
MSE Finance (Working Capital)	48%	46%
Corporate – NBFC Book	0%	0%
Corporate – Small Corporate	96%	96%
Total	51%	43%

^$GNPA & NNPA including IBPC

IDFC FIRST Bank Q1 FY21 Profit after Tax at Rs. 94 crore

IDFC FIRST Bank Q1 FY21 Profit after Tax at Rs. 94 crore

CASA deposits grows 145% YoY; CASA% reaches 33.7%; Capital adequacy reaches 15%

Financial results at a glance

The Board of Directors of IDFC FIRST Bank, the Bank created by the merger of IDFC Bank and Capital First recently, in its meeting held today, approved the combined audited financial results for the quarter ended June 30, 2020, as summarized below.

Earnings

§   The Profit after Tax for Q1 FY21 is reported at Rs. 94 crore as compared to Loss of Rs. 617 crore for Q1 FY20.

§   Q1 FY21 Net Interest Income (NII) grew 38% Y-o-Y to Rs. 1,626 crore, up from Rs. 1,174 crore in Q1 FY20. Despite the COVID-19 pandemic and lockdown impact, the Q-o-Q NII grew by 4%.

§   Net Interest Margin (quarterly annualized) rose to 4.53% in Q1 FY21 from 3.01% in Q1 FY20.

§   Fee and Other Income (without trading gains) decreased 54% to Rs. 148 Crore in Q1 FY21 as compared to Rs. 321 crore in Q1-FY20 due to lower loan originations and reduced banking activity on account of COVID-19 pandemic and related lockdown throughout the country. The trading gain for Q1-FY21 was at Rs. 337 crore.

§   Total Income (net of Interest Expense) grew by 42% at Rs. 2,111 crore for Q1-FY21 as compared to Rs. 1,485 crore for Q1-FY20.

§   Pre-Provisioning Profit (PPOP) increased by 181% to Rs. 892 crore in Q1 FY21 as compared to Rs. 318 crore in Q1 FY20.

§   Without the trading gain, Core PPOP, which is the Core Pre-Provisioning Operating Profit (Total Income net of Treasury gains and operating expenditure) increased by 69% on YOY basis from Rs. 328 crore in Q1-FY20 to Rs. 555 crore in Q1-FY21.

§   The provision for Q1-FY21 was at Rs. 764 crore as compared to Rs. 1,281 crore for Q1 FY20 and as compared to Rs. 679 crore in Q4 FY20. In the first phase of moratorium, the Bank took COVID-19 related provision of Rs. 225 crore through the profit and loss account in the quarter ending on March 31, 2020. During Q1-FY21 the Bank has created additional COVID-19 related provision of Rs. 375 crore to further strengthen the balance sheet.

 Liabilities – Strong and Steady growth

§   CASA Deposits posted strong growth, rising 145% YoY to Rs. 23,491 crore as on June 30, 2020 as compared to Rs. 9,594 crore as on June 30, 2019.

§   CASA Ratio improved to 33.74% as on June 30, 2020 as compared to 14.57% as on June 30, 2019.

§   Core Deposits (Retail CASA and Retail Term Deposits) increased 139% to Rs. 39,872 crore as on June 30, 2020 from 16,672 crore in June 30, 2019. This signifies the sticky and sustainable nature of the growing deposit balance.

§   The Fixed Deposits of the Bank has been assigned the highest rating “FAAA/Stable” by CRISIL.

§   The Bank has reduced its dependence on the wholesale and market borrowings which have been suitably replaced by the growth of core Retail Deposits. The borrowing through Certificate of Deposits (CD) of the Bank has reduced by 64% on YOY basis to Rs. 7,212 crore as on June 30, 2020 from Rs. 20,058 crore as of June 30, 2019.

§   As of June 30, 2020, the Bank has 503 branches and 417 ATMs across the country.

Loans and Advances – stable with growing retail %

§   Total Funded Loan Assets, gross of Inter-Bank Participation Certificates (IBPC), stood at Rs. 1,04,050 crore as on June 30, 2020, compared to Rs. 1,12,558 crore as on June 30, 2019 and as compared to Rs. 1,07,004 crore as on March 31, 2020. As the stated strategy the Bank focused on growing the retail loan book and decreased the wholesale loan book including infrastructure loans to reduce concentration risk on the portfolio.

§   Out of the total book mentioned above, Retail Loan Book increased by 26% to Rs. 56,043 crore as on June 30, 2020, compared to Rs. 44,642 crore as on June 30, 2019.

§   The Bank also acquired inorganic portfolio buyouts, primarily to cater to the PSL requirements where the underlying assets are retail loans. Retail loans including such inorganic portfolio constitute 61% of the overall loan assets.

§   Wholesale Loan Book, including Security receipts and Loans converted to equity reduced by 28% from Rs. 55,648 crore as of June 30, 2019 to Rs. 40,275 crore as of June 30, 2020 as the Large corporate loans and infrastructure loans continue to decline steadily as per the stated objective.

§   Within the wholesale segment as stated above, the Infrastructure loan book reduced by 34% to Rs. 13,416 crore as on June 30, 2020 from Rs. 20,322 crore as on June 30, 2019.

Asset Quality

§   Gross NPA of the Bank reduced to 1.99% as of June 30, 2020, as compared to 2.60% as of March 31, 2020.

§   Net NPA was 0.51% as of June 30, 2020, as compared to 0.94% as of March 31, 2020.

§   As of June 30, 2020, the Gross NPA % of the Retail Loan Book was at 0.87% as compared to 1.77% as of March 31, 2020 and Net NPA % of the Retail Loan Book of the Bank was at 0.24% as compared to 0.67% as of March 31, 2020.

§   The Provision coverage ratio on NPA accounts improved to 74.93% at June 30, 2020 as compared to 49.76% at June 30, 2019 and 64.53% at March 31, 2020.

§   The current NPA levels include the benefit of the moratorium provided to customers, including the overdue accounts which were at standstill.

§   Apart from the NPA, the identified stressed asset pool of the Bank, reduced by Rs. 943 crore during the last financial year. This stressed pool stood at Rs. 3,195 crore as of 30 June 2020 against which the Bank has done provisioning of Rs. 1,668 crore, 52% of the pool.

§   Apart from the NPA and Stressed Accounts as mentioned above, the Bank had also marked one large telecom account as stressed and provisioned 50% against the total outstanding of Rs. 3,244 crore (Funded – Rs. 2,000 crore and Non-Funded – Rs. 1,244

crore) in the quarter ending on 31 December 2019. The Bank continues to carry the same provision for the account as of June 30, 2020.

COVID-19 situation

§   During Q1-FY21, the nation-wide lockdown due to COVID19 pandemic stayed for the entire first two months of the last quarter and practically continues till now in the localized manner in some of the key business locations including main cities in India.

§   In the midst of such situation, the Bank continued to service its customers in all possible ways emphasizing on technology driven solutions and grew its business gradually, both for deposits and loans.

§   The branches of the Bank have remained open during this emergency time and the employees have efficiently helped their customers for all their needs in this situation, while remaining under the guidelines as prescribed by the Government Authorities.

§   The Bank introduced video-based KYC to onboard customers remotely in a completely touch-free way during the last quarter.

Impact on Disbursements

o   Retail disbursals were significantly impacted, especially during the month of April and May 2020, because of COVID-19 pandemic and related lockdown throughout the country. However, during June 2020, the disbursal revived once the lockdowns were relaxed up to an extent and has been in an improving trend since then.

o   The Emergency Credit Line Guarantee Scheme announced by the Government of India has been an excellent initiative to revive the businesses for the MSMEs and we have been participating to extend to our eligible customers under this scheme.

§   During May 2020, the RBI also announced the second phase of moratorium till end of August 2020 and the Bank accordingly extended moratorium to its eligible customers. For the second phase, till date, the Bank has provided moratorium to about 28% of its

customers based on the value, out of which 23% is in retail assets including rural portfolio and 35% is in the wholesale financing portfolio.

 Capital Position

§   As of June 30, 2020, the Net Worth of the Bank was Rs. 17,436 crore and the Book Value per share was Rs. 30.74.

§   Capital Adequacy of the Bank is strong at 15.03% with CET-1 Ratio at 14.58% as of June 30, 2020 as compared to Capital Adequacy Ratio of 13.38% and CET-1 Ratio of 13.30% as of March 31, 2020.

§   The Bank successfully raised Rs. 2,000 crore of fresh equity capital through preferential route during the quarter.

Mr. V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, said, “We are happy to inform that we continue to progress well on all parameters as per the guidance provided for the bank. Further, we have liberally provided moratorium to customers who sought it, and our moratorium was about 45% last quarter. This has reduced to 28% now, which we expect to fall below 10% by August 31, 2020, based on the strong improving trend in collections we are experiencing.”

IDBI Bank Reports Profit for Second Consecutive Quarter

IDBI Bank Reports Profit for Second Consecutive Quarter, Clocks Net Profit of ₹ 144 crore

Highlights of Q1 FY 2021 (Quarter ending June 30, 2020) Financial Results

Major Highlights

Ø  Bank reports PAT of ₹ 144 crore  for Q1 FY 2021 against loss ₹ 3,801 crore  for
Q1-FY 2020

Ø  Bank registers Profit Before Tax (PBT) of ₹ 438 crore for Q1 FY 2021 against Loss Before Tax of ₹ 5,381 crore for Q1 FY 2020

Ø  Operating Profit for Q1 FY 2021 is ₹ 1,326 crore , YoY growth of 39%

Ø  NII at ₹ 1,773 crore for Q1 FY 2021, YoY growth of 22%

Ø  NIM at 2.81% for Q1 FY 2021, YoY growth of 68 bps

Ø  CASA ratio at 47.55%, YoY growth of 440 bps

Ø  Net NPA at 3.55%. CRAR at 13.37%

Ø  PCR at 94.71%, is the highest in the Banking Industry

Profitability

·        Net Profit reported for Q1-2021 is ₹ 144 crore as against loss of ₹ 3,801 crore for Q1-2020. Net Profit for Q1-2021 has improved by 7% against ₹ 135 crore reported for Q4-2020

·        Profit Before Tax (PBT) improved for Q1-2021 to ₹ 438 crore as against loss of           ₹ 5,381 crore for Q1-2020. PBT for Q1-2021 has improved by 51% against ₹ 290 crore reported for Q4-2020

·        Operating profit for Q1-2021 improved by 39% to ₹ 1,326 crore as against ₹ 951 crore for Q1-2020

·        Net Interest Income (NII) for Q1-2021 improved by 22% to ₹ 1,773 crore as against ₹1,458 crore for Q1-2020

·        Net Interest Margin (NIM) improved by 68 bps to 2.81% for Q1-2021 as compared to 2.13% for Q1-2020

·        Cost of Deposit improved by 64 bps to 4.65% for Q1-2021 as compared to 5.29% for Q1-2020 and improvement of 17 bps as compared to 4.82% for Q4-2020

·        Cost of Funds improved by 67 bps to 4.96% for Q1-2021 as compared to 5.63% for Q1-2020 and improvement of 23 bps as compared to 5.19% for Q4-2020

·        Non-Interest Income to Total Income improved to 17.01% for Q1-2021 as compared to 14.06% for Q1-2020

·        Cost to Net Income Ratio has improved to 52.25% in Q1-2021 from 58.48% in Q1-2020.

Business

·        CASA increased to ₹ 1,04,315 crore as on June 30, 2020 as against ₹ 99,590 crore as on June 30, 2019

·        Share of CASA in Total Deposits improved to 47.55% as on June 30, 2020 as against 43.15% as on June 30, 2019

·        The composition of Advances portfolio Corporate V/s Retail was realigned to 43:57 as on June 30, 2020 as against 48:52 as on June 30, 2019

·        Structured Retail Assets portfolio increased by ₹ 3,696 crore (7%) to ₹ 58,633 crore as on June 30, 2020 from ₹ 54,938 crore as on June 30, 2019

Asset Quality

·        Gross NPA ratio improved to 26.81% as on June 30, 2020 as against 29.12% as on June 30, 2019 and 27.53% as on March 31, 2020

·        Net NPA ratio improved to 3.55% as on June 30, 2020 as against 8.02% as on June 30, 2019 and 4.19% as on March 31, 2020

·        Provision Coverage Ratio (including Technical Write-Offs) improved to 94.71% as on June 30, 2020 from 87.79% as on June 30, 2019 and 93.74% as on March 31, 2020

·        First Time NPAs reduced to ₹ 69 crore in Q1-2021 from ₹ 3,486 crore in        Q1-2020. FTNPA for Q4-2020 stood at ₹ 727 crore

Capital

·        Tier 1 improved to 10.59% as on June 30, 2020 as against 6.14% as on June 30, 2019

·        CRAR improved to 13.37% as on June 30, 2020 as against 8.14% as on June 30, 2019

·        Risk Weighted Assets (RWA) reduced by 5.70% to ₹ 1,60,994 crore as on June 30, 2020 as against ₹ 1,70,734 crore as on June 30, 2019

COVID 19 Impact

·        The Bank continues to hold provisions against impact of COVID 19. During quarter ended June 2020, the Bank has made further COVID 19 related provisions of  ₹ 189 crore (Cumulative provision of ₹ 436 crore). The provision made by the Bank is more than minimum required as per the RBI guidelines.

IDBI-LIC Major achievements during Q1 FY 2021

·        LIC renewal Premium Collection through- Cash & Cheque increased during COVID-19. ~95% Branch activation & 1.15 lakh Transactions during Q1FY21.

·        MOU for Tie-up with LIC- Card Services Limited for launching co-branded credit cards executed.

·        New Insurance products on boarded on online BANCA platform ~85 % Branch activation & 7192 NOPs sourced with ₹ 95 crore premium during Q1 FY2021 with YOY Growth of 22%.

·        Agreement executed for appointment of LICHFL - Financial Service Limited (LICHFL-FSL) as corporate DSA for sourcing of NSRA (MSME & Agriculture) and select SRA loans (Auto, Personal & Education Loan).

Significant Developments during Q1 2021

·        The Bank launched FASTag for retail customers to enable automatic and cashless toll payments using RFID tag pasted on their vehicles.

·        The Bank received the Client Innovation Award from Infosys for Dynamic Virtual Account Product which facilitates electronic collection of proceeds with API Integration for Corporate and Institutional Clients.

·        The Bank received NPCI Certification for Electronic Toll Collection at Toll Plazas of IDBI Bank assisted and other Concessionaires.

·        The Bank has received citation for three awards in different categories from Association of Business Communicators of India (ABCI) for IDBI Bank’s quarterly Hindi Magazine ‘Vikas Prabha’.

·    The Board of Directors of IDBI Bank Ltd. (IDBI Bank) met in Mumbai today and approved the financial results for the Quarter ended June 30, 2020.