IDBI Bank reports 125% increase in

 IDBI Bank reports 125% increase in Net Profit at ₹ 324 crore for Q2 FY 2021

Highlights of Q2 FY 2021 (Quarter ending September 30, 2020) Financial Results

Major Highlights

• Bank reports Net profit of ₹ 324 crore  for Q2 FY 2021 against net loss ₹3,459 crore  for Q2-FY 2020
• Bank registers Profit Before Tax (PBT) of ₹ 665 crore for Q2 FY 2021 against Loss Before Tax of ₹ 4,632 crore for Q2 FY 2020.
•  Operating Profit for Q2 FY 2021 is ₹ 1,246 crore , YoY growth of 23%.
•  NII at ₹ 1,695 crore for Q2 FY 2021, YoY growth of 4%.
•  NIM at 2.70% for Q2 FY 2021,   YoY growth of 37 bps.
•  CASA ratio at 48.33%, YoY growth of 346 bps
• Net NPA at 2.67%. CRAR at 13.67% 
•   PCR stood at 95.96%.
  

Operating Performance

• Net Profit reported for Q2-2021 is ₹ 324 crore as against loss of ₹ 3,459 crore for Q2-2020. Net Profit for Q2-2021 has improved by 125% against ₹ 144 crore reported for Q1-2021.
•  PBT improved for Q2-2021 to ₹ 665 crore as against loss of ₹ 4,632 crore for Q2-2020. PBT for Q2-2021 has improved by 52% against ₹ 438 crore reported for Q1-2021.

• Operating profit for Q2-2021 improved by 23% to ₹ 1,246 crore as against ₹ 1,009 crore for Q2-2020.Net Interest Income (NII) for Q2-2021 improved by 4% to ₹ 1,695 crore as against ₹1,631 crore for Q2-2020
•  Net Interest Margin (NIM) improved by 37 bps to 2.70% for Q2-2021 as compared to 2.33% for Q2-2020
•  Cost of Deposit improved by 76 bps to 4.41% for Q2-2021 as compared to 5.17% for Q2-2020
• Cost of Funds improved by 80 bps to 4.73% for Q2-2021 as compared to 5.53% for Q2-2020.
• ·        Non-Interest Income to Total Income improved to 18.61% for Q2-2021 as compared to 16.57% for Q2-2020.
•   Cost to Net Income Ratio has improved to 54.96% in Q2-2021 from 62.11% in Q020.

Business Growth

• CASA increased to ₹ 1,08,217 crore as on September 30, 2020 as against  ₹ 1,04,027 crore as on September 30, 2019.

• Share of CASA in Total Deposits improved to 48.33% as on September 30, 2020 as against 44.87% as on September 30, 2019.

• The composition of Advances portfolio Corporate V/s Retail was realigned to 42:58 as on September 30, 2020 as against 47:53 as on September 30, 2019.

Asset Quality

• Gross NPA ratio improved to 25.08% as on September 30, 2020 as against 29.43% as on September 30, 2019 and 26.81% as on June 30, 2020.

•   Net NPA ratio improved to 2.67% as on September 30, 2020 as against 5.97% as on September 30, 2019 and 3.55% as on June 30, 2020.

• Provision Coverage Ratio (including Technical Write-Offs) improved to 95.96% as on September 30, 2020 from 91.25% as on September 30, 2019 and 94.71% as on June 30, 2020.

Capital Position

• Tier 1 improved to 11.06% as on September 30, 2020 as against 9.52% as on September 30, 2019.

• CRAR improved to 13.67% as on September 30, 2020 as against 11.98% as on September 30, 2019.

•   Risk Weighted Assets (RWA) reduced by 6.27% to ₹ 1,57,323 crore as on September 30, 2020 as against ₹ 1,67,842 crore as on September 30, 2019. Credit Risk weighted assets reduced by 6% to ₹ 1,28,087 crore from ₹ 1,36,789 crore as on September 30, 2019.

COVID 19 Impact

• ·        In accordance with the RBI guidelines relating to COVID-19, the Bank has granted a moratorium on the payment of installments and or interest, as applicable, falling due between March 1, 2020 and August 31, 2020 ('moratorium period') to eligible borrowers classified as Standard, even if overdue, as on February 29, 2020, without considering them as restructuring. Bank has made COVID-19 related provision of ₹ 247 crore in March 2020 quarter and ₹ 189 crore in June 2020 quarter. Cumulative COVID-19 related provision was ₹ 436 crore as at September 30, 2020. The provision made by the Bank is more than minimum required as per the RBI guidelines.

• ·        RBI has provided for Resolution framework for COVID -19 related stress vide circular dated August 6, 2020. Bank has as a prudent measure made provision of  ₹ 270 crore towards the expected provisioning requirement for cases to be restructured under the Resolution framework.

• ·        Pursuant to Supreme Court interim order dated September 3, 2020, in the PIL case of Gajendra Sharma vs Union Bank of India & Anr, Bank has not classified any borrower account as NPA, which has not been classified as NPA as on August 31, 2020. Bank has however maintained provision against the same under standard assets provision.  However, if the Bank had classified borrower accounts as NPA after August 31, 2020, the bank’s proforma Gross NPA ratio and proforma Net NPA ratio would have been 25.20% and 2.81% respectively.

Significant Developments during Q2 2021

• ·        IDBI Bank has launched Banking Services 24X7 on WhatsApp on October 15, 2020

• ·        IDBI Bank has won the Trusted Brand Award in the Banks - Private category as adjudged in a consumer survey entitled Reader’s Digest Trusted Brand, 2020.

• ·        The Bank extended its social media presence by launching its official Instagram account “idbibankofficial”.

• ·        IDBI Bank announced the launch of six specialized gold loan branches branded as “IDBI Swarna Kalash”, by remodeling its existing branches at Bengaluru, Hyderabad and New Delhi.

• ·        IDBI Bank has executed an agreement to sell up to 27% stake in its Joint venture Insurance arm, IDBI Federal Life Insurance Company Limited (IFLI), to other JV partners as Age Insurance International NV  and The Federal Bank Limited.

• ·        IDBI Bank became the first bank to have implemented the new feature of document embedding facility with Letter of Credit (“LC”) / Bank Guarantee (“BG”) messages over SFMS platform of IFTAS (a wholly owned subsidiary of Reserve Bank of India) through its middleware application i@Connect-SFMS (CSFMS) developed by IDBI Intech Limited.

• ·        IDBI Bank announced the launch of two new variants of NACH Facility namely E-NACH and B-NACH for Corporate Customers at large, and more specifically for customers falling under BFSI segment. With this, the Bank will provide a Web based solution, to its Corporate Customers, to facilitate their interbank, high volume, electronic transactions which are repetitive and periodic in nature. It is a step towards adding one more product in the Digital kitty of the Bank, for its Corporate Customers.

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

ESAF Small Finance Bank Profit Soars

ESAF Small Finance Bank Profit Soars 110%

ESAF Small Finance Bank has recorded a 110.86 %, increase in its net profit for the year ended March 31,2020.   The net profit for the Financial Year increased to 190.39 crore from Rs 90.29 crore registered in the year before. 

Commenting on the results, K. Paul Thomas, Managing Director and CEO of ESAF Small Finance Bank, said “the encouraging results showed the strong performance of the bank despite a slowdown in the market. Also the growth in the business has not affected the asset quality. It also highlighted the fact that we are delivering Joy of banking to all by keeping our focus on empowering of the poor and the marginalized”.

The business during the year increased by 49.05% to touch Rs 13,846 crore.  The deposits have registered an increase of 62.81 % to Rs 7,028 crore and advances (Assets Under Management) increased by 37.11 % to the tune of Rs 6818 crore. The gross NPA percent reduced from 1.61 % to 1.53% and Net NPA reduced from 0.77% to 0.64% during the year.  Also, the provision coverage ratio improved to 79.93% from 78.45% during the previous year.

The Capital position of the bank is comfortable at 24.03% with Tier 1 CRAR of 20.99% as against regulatory requirement of 15% and 7.5% respectively. The bank has sufficient capital cushion for it’s medium term business plan and also has enough headroom under Tier II.

The resilience of the bank’s customer segment is encouraging and it has taken adequate steps to uplift them as the activities are slowly resuming. We are optimistic about the future as the business relaxations given to the rural entrepreneurs can uplift the rural economy and we can play a key role in the same” Mr. Thomas concluded.

At present, ESAF Small Finance Bank has presence in 17 states and one Union Territory in India. As on March 31, 2020, the Bank is serving 35 lakh customer base through 454 branches and 14 Business Correspondent Entities and is operating 222 ATMs across the country.   

ESAF Small Finance Bank Limited is proposing, subject to receipt of requisite approvals, market conditions and other considerations, to make an initial public offer of its equity shares and has filed a draft red herring prospectus (“DRHP”) with the Securities and Exchange Board of India. The DRHP is available on the website of the SEBI at www.sebi.gov.in as well as on the websites of the book running lead managers, Axis Capital Limited, Edelweiss Financial Services Limited, ICICI Securities Limited and IIFL Securities Limited, at www.axiscapital.co.in, www.edelweissfin.com, www.icicisecurities.com and www.iiflcap.com respectively, and the websites of the stock exchanges at www.bseindia.com and www.nseindia.com, respectively. 

Any potential investor should note that investment in equity shares involves a high degree of risk and for details relating to such risk, see "Risk Factors" of the RHP/ Prospectus when available. Potential investors should not rely on the DRHP for any investment decision

ESAF Small Finance Bank announces closing

ESAF Small Finance Bank announces closing 

of INR 464 Cr Private Placement - 10th October 2018

ESAF Small Finance Bank announced the completion of private placement of the Company's common stock worth INR 464 Cr. ICICI Securities Ltd served as the advisor for the private placement. Polymath Advisors, Mumbai also associated with ESAF SFB in these transactions. PNB MetLife India Insurance Co. Ltd. and ESAF Multi-State Co-operative have taken a stake of 4.99% each in the Bank. Bajaj Allianz Life Insurance Co. Ltd. and ICICI Lombard General Insurance Co. Ltd. have taken a stake of 4.08% and 1.45% respectively. Seven other investors have also taken stake in ESAF Small Finance Bank.

With the infusion of additional capital the net worth of the bank has increased to 807 crore and the CRAR to 27.9 percent. “We are extremely pleased with the success of this transaction and the confidence expressed in our continued growth and profitability,” said K. Paul Thomas, MD and CEO, ESAF Small Finance Bank. “The proceeds from the private placements will be used for general corporate purposes, capital management and to support future growth” he added.  

ESAF has accumulated 3 billion worth deposits in the first half of the Financial Year and has added 2.5 million customers. The bank currently has 422 banking outlets, which include 297 ultra-small branches and 125 new retail banking outlets spread across 11 states in India. With 2 million borrowers, the bank has accumulated 4.4 billion in loans and advances.