Professional Documents
Culture Documents
January 2013
Disclaimer
This presentation is strictly confidential and may not be copied, published, distributed or transmitted. The information in this presentation is being provided by Development Credit Bank Limited (the Bank). This presentation has been prepared for information purposes only and is not an offer or invitation, directly or indirectly, to buy or sell any securities, nor shall part, or all, of this presentation form the basis of or be relied on in connection with, any contract or investment decision in relation to any securities. This presentation is not an offer document or a prospectus under the Companies Act, 1956, as amended, the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended and any other applicable law. This presentation contains forward-looking statements based on the currently held beliefs and assumptions of the management of the Bank, which are expressed in good faith and, in their opinion, reasonable. Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition, performance, or achievements of the Bank or industry results to differ materially from the results, financial condition, performance or achievements expressed or implied by such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding expansion plans and the benefits there from, fluctuations in our earnings, our ability to manage growth and implement strategies, intense competition in our business including those factors which may affect our cost advantage, our ability to attract and retain highly skilled professionals, changes in technology, availability of financing, our ability to successfully complete and integrate our business plans, liabilities, political instability and general economic conditions affecting our industry. Given these risks, uncertainties and other factors, recipients of this document are cautioned not to place undue reliance on these forward-looking statements. The Bank disclaims any obligation to update these forward-looking statements to reflect future events or developments. This presentation is not an offer of securities for sale in the United States or in any other jurisdiction. Securities may not be offered or sold in the United States absent registration or an exemption from registration. No shares or other securities may be offered or sold other than in compliance with the laws of relevant jurisdictions, including the United States Securities Act of 1933, as amended.
By viewing this presentation you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Bank and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the business of the Bank.
Except as otherwise noted, all of the information contained herein is preliminary and indicative and is based on management information, current plans and estimates. Industry and market-related information is obtained or derived from industry publications and has not been verified by us. The information contained in this presentation, except as otherwise noted, is only current as of the date of the presentation, is subject to change without notice. The Bank may alter, modify or otherwise change in any manner the content of this presentation, without any obligation to notify any person of such revision or changes. Persons relying on the information in this presentation should do so at their own risk and the Bank shall not be responsible for any kind of consequences or liability to any person arising out of, relying and acting upon any such information. Financial numbers are rounded off to nearest whole number
Development Credit Bank Ltd (DCB Bank) http://www.dcbbank.com is a modern emerging new generation private sector bank.
Present since 1930s, DCB is the only co-operative bank in India to have been converted into a private sector commercial bank in 1995
Distribution network of 89 branches across 28 cities and 296 ATMs Business model focused on achieving a balance between Micro SME, SME, Retail Mortgages, Commercial Vehicle, Gold
Loans, mid-Corporate and Agri / Inclusive Banking
Comprehensive range of banking products across all businesses Modern systems and infrastructure to support growth- Finacle, FinnOne, CMS, Internet and Mobile banking Traditional sticky customer base helped by presence of branch network in key areas of Maharashtra, Gujarat and AP Provides DCB Bank access to low cost deposits
Continued focus on building a low cost Deposits and strong capital position CASA of 28.87% and CRAR of 13.71% under Basel II
Crisil rating (Long term): BBB + / Positive, Crisil rating (Short term): A1 and Brickwork Ratings: BWR A- (Stable)
DCBs promoter, Aga Khan Fund for Economic Development (AKFED) http://www.akdn.org/akfed is present in 16 countries
employing over 30,000 people
Promoter group holds 18.48% stake in DCB Nasser Munjee, Chairman: Ex- Executive Director HDFC, instrumental in setting up IDFC & sits on the boards of many large
Indian companies
Murali M. Natrajan, MD & CEO: worked in Standard Chartered Bank (Global Head SME Banking), Citibank, American
Express; strong Retail Banking & SME experience in India & abroad
Financial Performance
Highlights
INR mn Q3 FY 2013 Q3 FY 2012 Inc / (Dec) FY 2012 FY 2011 Inc / (Dec)
Net Profit
Total Income Operating Profit Provisions Cost to Income Ratio INR mn Deposits CASA NRI Deposits Advances
269
1,009 318 (49) 68.52%
156
854 225 (69) 73.64% December 31, 2012 75,582 21,823 4,544 59,644
72.1%
18.2% 41.1% 29.3% -
551
3,281 838 (287) 74.45% December 31, 2011 61,912 20,478 2,413 43,064
214
3,012 861 (646) 71.43%
157.0%
8.9% (2.6%) 55.57% -
INR mn
CASA Ratio Gross NPA Ratio Net NPA Ratio Provision Coverage Ratio Credit/Deposit Ratio ROA ROE
Private & Confidential
269 221
189 173
156
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
FY 2009
FY 2010
FY 2011
FY 2012
639
670
720
FY 2009
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
Other Income
INR mn
281
275
275
289
1,201 1,075
257
1,121
1,004
FY 2009
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
7
1,246
317 310
329
341
350
1,044 881
1,064
FY 2009
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
Other Cost
INR mn
312
337 303
339
341
FY 2009
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
8
3,173 2,491
3,012
3,281
854
851
914
945
1,009
FY 2009
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
Operating Cost
INR mn
73.64%
76.27% 80.62% 71.43% 74.45%
71.90%
72.85%
71.95% 680
68.52% 692
629
612
666
2,443
FY 2009
Private & Confidential
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
9
Operating Profit
Operating Profit
INR mn
318
838
225
239
248
265
FY 2009
FY 2010
FY 2011
FY 2012
Q3 FY12
Q4 FY12
Q1 FY13
Q2 FY13
Q3 FY13
Provisions
1,634 1,268
69 66 59 44
INR mn
49
Q2 FY13
Q3 FY13
* Provisions include provisions for NPAs, standard assets, income tax, fringe benefit tax, other assets, restructured advances etc Provisions also includes depreciation on investments and sacrifice of one time settlement
Private & Confidential
10
INR mn
CASA Retail Term Deposits Mortgages Commercial Vehicle SME + Micro SME Agri & Inclusive Banking Corporate Banking
23,056
4,118 1,951 6,004 8,583 11,095
27,085
10,811 727 10,219 8,502 11,153
31,946
15,102 195 12,579 4,169 8,907
34,320
15,510 1,048 14,038 8,014 11,941
36,721
17,889 968 13,943 7,244 12,599
38,888
19,494 966 14,930 6,115 13,097
42,084
21,296 1,050 15,035 5,856 14,120
11
Balance Sheet
Total Assets
INR mn
82,610
74,129
86,769
91,002
92,983
96,436
59,430
61,367
Net Advances*
INR mn
54,491
56,710
59,644
12
Diversified Portfolio
Portfolio* as on Mar 31, 2010 Portfolio* as on Mar 31, 2011
M o r t g ag es 2 5%
C V / C E/ ST V L 2%
Gold Loan 1%
M o rt g ag es 29%
PL/ C E/ ST V L 0 .0 5%
Mortgages 36%
Ot hers 4% SM E+M SM E 2 7%
Others 2%
SME + MSME 25%
* AIB Agri & Inclusive Banking, MSME Micro SME, PL / CE / STVL Personal Loan, Construction Equipment and Small Ticket Vehicle Loan
Private & Confidential
13
INR mn INR mn
3,630 50,129
3,178 2,601
3,957 28,101 1,590 29,356 33,746
2,208 44,927
46,573
38,256
40,801
14,411
16,927
19,755
20,478
20,347
20,662
21,723
21,823
CASA
Term Deposits
Other Deposits
CASA
Mar 31, 2009 31.01% Mar 31, 2010 35.36% Mar 31, 2011 35.21% Dec 31, 2011 33.08% Mar 31, 2012 32.12% Jun 30, 2012 30.25% Sep 30, 2012 30.44% Dec 31, 2012 28.87%
Access to low cost stable funding source to support Advances growth without undue reliance on volatile wholesale funding
Private & Confidential
14
51,333
53,482 34,320
56,492
36,721
59,394
62,701 42,083
45,540
39,034 31,380
38,888
31,946
23,056 15,978
Mar 31, 2010
18,132 13,248
Mar 31, 2009 18,455 Mar 31, 2011 19,387 Dec 31, 2011 Retail CASA
19,771
20,618
INR mn
82 80 80 80 227 390
84 409
86
87
447
89 473
427
339
288
166
200
231
236
228
230
236
232
No of Branches
15
100.00%
100.00%
100.00%
85.55% 5.90%
87.89% 5.75%
87.38% 5.67%
100.00% 91.17%
100.00%
100.00%
100.00% 88.04%
88.50%
89.25%
5.85%
4.40%
4.18%
3.86%
3.80%
3.11%
0.96%
1.19%
0.97%
1.03%
0.57%
0.75%
0.68%
0.73%
Gross NPA%
Gross NPA
Net NPA**
3,192
1,076
2,636
412
2,564
443
2,418
302
2,362
409
2,260
384
2,339
435
* CV / CE / STVL represents Commercial Vehicle, Construction Equipment and Small Ticket Vehicle Loan ** Net NPA = Gross NPA (Balance in Interest Suspense account + DICGC/ECGC claims received and held pending adjustment + Part payment received and kept in suspense account + total provisions held)
Private & Confidential
16
3.41%
3.13% 3.10%
3.37% 3.12%
3.25%
3.18%
3.24%
3.38%
2.79%
FY 2010
FY 2011
Q1 FY12
Q2 FY12
Q3 FY12
Q4 FY12
FY 2012
Q1 FY13
Q2 FY13
Q3 FY13
12.33% 11.12%
11.86%
12.66%
9.00%
9.50%
10.00%
10.50%
10.50%
10.50%
10.50%
10.50%
10.50%
6.44%
6.67% 5.83%
6.98%
7.16%
7.57%
7.80% 7.11%
7.74%
7.73%
FY 2010
FY 2011
Q1 FY 12
Q2 FY 12
Q3 FY 12
Q4 FY 12
Cost of Fu nds
FY 2012
Base Rate
Q1 2013
Q2 2013
Q3 FY 13 17
14.85%
15.41% 13.25%
2.15%
13.30%
1.80%
2.92%
13.00%
1.85%
1.60%
14.49%
1.31%
13.97%
1.26%
13.71%
1.08%
11.50%
11.93%
11.10%
11.15%
13.81%
13.18%
12.71%
12.63%
In Q3 FY 2013 - DCB Bank raised INR 402 million through Preferential Allotment to increase its Tier I Capital
18
Other Income
INR mn Commission, exchange and brokerage Sale of investments Sale of land, buildings and other assets Exchange transactions Bad Debt Recovered Miscellaneous income Total FY 2010 682 178 (3) 68 14 136 1,075 FY 2011 683 253 11 90 6 78 1,121 Q3FY12 202 18 19 2 16 257 Q4FY12 230 26 (13) 21 7 10 281 FY 2012 786 118 (28) 69 10 49 1,004 Q1FY13 206 38 (2) 18 10 5 275 Q2FY13 217 22 (1) 6 19 12 275 Q3FY13 222 27 20 14 6 289
19
Treasury
INR mn SLR Non-SLR Total Investments * HTM AFS HFT Total Investments * Mar 31, 2010 15,789 4,390 20,179 16,890 3,263 26 20,179 Mar 31, 2011 17,512 5,439 22,951 18,847 3,029 1,075 22,951 Mar 31, 2012 20, 219 4,959 25,178 20,845 3,541 792 25,178 Dec 31, 2012 21,501 5,562 27,063 21,455 5,008 600 27,063
* Represents Net investments (HTM Held To Maturity, AFS Available For Sale, Held For Trading)
Private & Confidential
20
Balance Sheet
Mar 31, 2010 5,990 47,873 5,035 2,447 Mar 31, 2011 6,187 56,102 8,607 3,205 Dec 31, 2011 6,561 61,912 10,455 3,652 Mar 31, 2012 8,585 63,356 11,235 3,565 Jun 30, 2012 8,772 68,294 10,101 3,807 Sep 30, 2012 8,990 71,370 8,801 3,792 Dec 31, 2012 9,660 75,582 7,175 3,990
72.27%
Mar 31, 2010 16,927 30,946 47,873 35.36%
76.32%
Mar 31, 2011 19,755 36,347 56,102 35.21%
69.56%
Dec 31, 2011 20,478 41,434 61,912 33.08%
83.41%
Mar 31, 2012 20,347 43,009 63,356 32.12%
79.79%
Jun 30, 2012 20,662 47,632 68,294 30.25%
79.46%
Sep 30, 2012 21,723 49,647 71,370 30.44%
78.91%
Dec 31, 2012 21,823 53,759 75,582 28.87%
1 : Subordinated Debt included in Borrowings since March 31, 2010 as per RBI guidelines, same included in Other Liabilities and Provisions in earlier periods
Private & Confidential
21
INR mn Net Interest Income Other Income Operating Income Operating Expenses Operating Profit Total Provisions
PAT
Cost Income Ratio
(785)
80.62%
214
71.43%
156
73.64%
173
71.90%
551
74.45%
189
72.85%
221
71.95%
269
68.52%
22
Business Strategy
23
89 5 296 35,000 +
* Branch locations as shown on the map are approximate may not represent the exact location ** Tie up with Euronet enables DCB Bank customers to access VISA ATMs across the world
Current Account Trade Current Account Working Capital Term Loans Supply Chain Portfolio Buyout Import /Export Bills Collection Foreign Exchange Letters of Credit Guarantees
Privilege Banking
Internet Banking Mobile Banking
Statutory Reserves Management Liquidity Management Trading in Government Securities Foreign Exchange Corporate Bonds CDs Equity Investment
25
Business Strategy
Grow Micro SME, SME, Retail Mortgages, Commercial Vehicle, Gold Loans, mid Corporate and Agri & Inclusive Banking with a customer centric approach. Concentrate on secured lending & diversified portfolio
Stringent mechanism for managing Credit and Operational risks Continuously improve people quality and delivery
Private & Confidential
26
Overview
27
Key Milestones
In Existence Since 1930s
1981
1984
1988
1995
Amalgamation of Masalawala Cooperative Bank and Ismailia Cooperative Bank into Development Cooperative Bank Ltd.
2004
2006
Conversion to Development Credit Bank Ltd. Secured Foreign Exchange License & became an Authorized Dealer
IPO
2005
2006
2006
2007
2009
2012
Private Equity Investment by AKFED (Principal Promoter) of INR 1.38 bn in March 2005
Raised INR 940 mn through QIP and INR 988 mn through Preferential Allotment in March 2012. The Bank raised INR 402 mn via Preferential Allotment in December 2012
28
Bodies Corporate 10.46%
Shareholding Pattern
Individuals 36.56%
*AKFED Aga Khan Fund for Economic Development and PJI Platinum Jubilee Investment Ltd. **Includes Clearing Members (0.76%), Non Resident Indians (2.45%), Foreign Corporate Bodies (7.65%), Directors and their relatives (0.03%) ***Institutions includes 10.21% held by FII
Aga Khan Fund for Economic Development
DCB Bank is promoted by the Aga Khan Fund for Economic Development (AKFED) http://www.akdn.org/akfed AKFED is an international development enterprise. It is dedicated to promoting entrepreneurship and building economically sound companies
AKFED operates as a network of affiliates with more than 90 separate project companies employing over 30,000 people. The Fund is active in 16 countries in the developing world
29
Experienced Board
Amin Manekia Altaf Jiwani C Narasimhan
Pioneered in concept of automatic beverage vending machines in India. More than 20 years in various capacities in different institutions of AKDN for the social-economic upliftment of the poor. With expertise in Foreign Exchange, Risk Management and Trade Finance. He is currently in-charge of two business segments namely power and carbo-chemicals. A professional Banker. With SBI, held very senior level responsibilities across all important functions. He was a permanent invitee of SBIs Central Board and Audit Committees and on the Boards of SBI Group Cos. Solicitor & Advocate of the Bombay High Court and Solicitor of the Supreme Court of England and Wales. Founder Partner of Udwadia and Udeshi. Independent Director on the Boards of several corporate entities. Qualified Chartered Accountant and Cost Accountant. Advisor to several Corporate Managements and High Net worth Individuals on investment strategy and acted as consultant to reputed Mutual Fund. Rich experience in accounting, audit and finance. Partner of over 37 years with M/s. Kalyaniwala & Mistry, a C. A. firm. Independent Director on the Boards of several corporate entities and boards of Public Trusts. Standard Chartered Bank, Citibank, American Express *29 years experience.
Darius Udwadia
Retired partner of Deloitte Haskins & Sells and S. B. Billimoria Co. Member of Expert Advisory Committee and Past member of Accounting Standards Board of ICAI and Company Law Committee of the Bombay Chambers. Fellow of the Institute of Chartered Accountants of England & Wales (FCA). Currently working as Managing Director of Diamond Trust Bank of Kenya & Group CEO of Diamond Trust Banks in East Africa. Founder Partner of Economic Laws Practice, a law firm. Serves as an Independent Director on the Board of Phoenix Mills, India Advisory Board of Duke University, etc. Retired as Chairman and Managing Director of Central Bank of India. Has also served as the Chairman and Managing Director of National Housing Bank (NHB) and Executive Director of EXIM Bank. Started career with SBI. Associated with ANZ Grindlays Bank plc for over 30 years. Last assignment with Grindlays as Head Corporate Banking & Investment Banking. Independent Director on the Boards of Diamond Trust Bank Kenya & Greaves Cotton.
Development Credit Bank Limited 30
Nasim Devji
J. K Vishwanath Chief Credit Officer Fullerton India, Citigroup and Eicher Group 19 yrs exp.
Bharat Sampat Chief Financial Officer ABN Amro Bank, Standard Chartered Bank, ANZ Banking Group, Hoechst India *28 yrs exp.
Manoj Joshi Business Head SME & MSME Banking ICICI Bank, Epcos Ferrites and Uniworth Group 17 yrs exp.
Narendranath Mishra Head - AIB ICICI Bank and Rallis India 13 yrs exp.
Murali M. Natrajan Managing Director & CEO Standard Chartered Bank, Citibank, American Express *29 yrs exp.
Praveen Kutty Head Retail & SME Banking Citibank *21 yrs exp.
Sachin Patange Chief Compliance Officer Reserve Bank of India 22 yrs exp.
Ravi Kumar Chief Internal Auditor Samba Financial Group, Ernst & Young *15 yrs exp.
Sridhar Seshadri Financial Controller ICICI Bank, Syndicate Bank and State Bank of India 30 yrs exp.
Hemant Barve Company Secretary Ritchie Steuart Investments and Union Bank of India 38 yrs exp.
31
Ratings
- Long Term
- Short Term Brickworks
BBB/Stable
P1 BWR A-/Stable
BBB +/Stable
A1 BWR A-/Stable
BBB +/Positive
A1 BWR A-/Stable
32
Thank you
33