Changes for page City Union Bank Ltd
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... ... @@ -30,18 +30,17 @@ 30 30 |(% style="width:108px" %)2014|(% style="width:717px" %)Raised INR Rs.3,500 mn in Equity capital Through QIP route 31 31 |(% style="width:108px" %)2017 & 2018|(% style="width:717px" %)Bonus Issue @ 1 : 10 - rewarded to the existing Shareholders 32 32 33 - 34 34 As of Sep 2020 - 700 branches. 628 branches are located in South India out of which 485 in Tamil Nadu 35 35 36 36 (% style="width:636px" %) 37 -|(% style="width:134px" %)State|(% style="width:129px" %)((( 38 -No. of Branches 36 +|(% style="width:134px" %)**State**|(% style="width:129px" %)((( 37 +**No. of Branches** 39 39 )))|(% style="width:115px" %)((( 40 -% of Deposits 39 +**% of Deposits** 41 41 )))|(% style="width:123px" %)((( 42 -% of Advances 41 +**% of Advances** 43 43 )))|(% style="width:132px" %)((( 44 -% of Business 43 +**% of Business** 45 45 ))) 46 46 |(% style="width:134px" %)Tamilnadu|(% style="width:129px" %)485|(% style="width:115px" %)80|(% style="width:123px" %)64|(% style="width:132px" %)72 47 47 |(% style="width:134px" %)Karnataka|(% style="width:129px" %)41|(% style="width:115px" %)6|(% style="width:123px" %)6|(% style="width:132px" %)6 ... ... @@ -54,23 +54,18 @@ 54 54 |(% style="width:134px" %)Total|(% style="width:129px" %)700|(% style="width:115px" %) |(% style="width:123px" %) |(% style="width:132px" %) 55 55 56 56 56 += Industry Overview = 57 57 58 -Industry Overview 58 +The Indian economy performed well in the first half of FY2020 mainly due to various policy measures taken by the New Government at the Centre. India's GDP (Gross Domestic Product) grew at 5.2% in Q1, 4.4% in Q2, 4.1% in Q3 & 3.1 in Q4, aggregating to a growth of 4.2% for the full year. The slowdown in last quarter has been due to decline in economic activity because of the countrywide lockdown due to COVID19. With the economy hit by pandemic towards the end, the GDP for FY2020 would be below the government target of 5%. The retail inflation touched a high of 7.59% in month of January 2020 and declined thereafter to close at 5.81%. Crude Oil remained volatile with geopolitical events, supply-demand mismatches and resurgence of trade barriers. The Brent crude oil hovered between $74 / barrel and $20 / barrel in the year. The Agriculture sector however proved to be a silver lining, necessitated by sowing of pulses, rice and oilseeds in the summer months. Agriculture and Allied activities were buoyed by increase in Kharif and horticulture production. Domestic Air Traffic, Passenger and Commercial vehicle sales, Domestic Tourism, Hospitality & Trade experienced sizeable contraction. There has been a decline in private domestic consumption due to contraction of manufacturing activities. As per RBI reports, it is difficult to assess the depth of the damage caused by the pandemic and estimate how long will it take to return to normal levels. {{footnote}}https://www.cityunionbank.com/downloads/CUB_ARFinal_22072020_Final.pdf{{/footnote}} 59 59 60 - 61 -The Indian economy performed well in the first half of FY2020 mainly due to various policy measures taken by the New Government at the Centre. India's GDP (Gross Domestic Product) grew at 5.2% in Q1, 4.4% in Q2, 4.1% in Q3 & 3.1 in Q4, aggregating to a growth of 4.2% for the full year. The slowdown in last quarter has been due to decline in economic activity because of the countrywide lockdown due to COVID19. With the economy hit by pandemic towards the end, the GDP for FY2020 would be below the government target of 5%. The retail inflation touched a high of 7.59% in month of January 2020 and declined thereafter to close at 5.81%. Crude Oil remained volatile with geopolitical events, supply-demand mismatches and resurgence of trade barriers. The Brent crude oil hovered between $74 / barrel and $20 / barrel in the year. The Agriculture sector however proved to be a silver lining, necessitated by sowing of pulses, rice and oilseeds in the summer months. Agriculture and Allied activities were buoyed by increase in Kharif and horticulture production. Domestic Air Traffic, Passenger and Commercial vehicle sales, Domestic Tourism, Hospitality & Trade experienced sizeable contraction. There has been a decline in private domestic consumption due to contraction of manufacturing activities. As per RBI reports, it is difficult to assess the depth of the damage caused by the pandemic and estimate how long will it take to return to normal levels. 62 - 63 -[[https:~~/~~/www.cityunionbank.com/downloads/CUB_ARFinal_22072020_Final.pdf>>url:https://www.cityunionbank.com/downloads/CUB_ARFinal_22072020_Final.pdf]] 64 - 65 65 The Indian Banking Sector which experienced mounting NPA's in FY 2018-19 started showing signs of revival in the first half of FY 2019-20. FY 2019 also saw a steady flow of Foreign Direct Investment of which the banking and financial sector received the highest share for the first three quarters of 2019-20. Public Sector Banks had also collectively posted net profits in the First Quarter of FY 2019-20 as against 2018-19. However, the Banking sector as of now is facing a tough task due to COVID-19 pandemic. The banking sector is likely to witness a partial recovery, following the revival of economy and gradual easing of lockdown. Fiscal measures by the government and significant Monetary and Liquidity measures by RBI would go a long way in mitigating the adverse impact on domestic economy and help boost economic activity once normalcy is restored. 66 66 67 - 68 68 The financial year turned favourable for the bond market with the Government Securities yields starting to fall from the high of 7.47% to 6.07% during the year. The first half of financial year saw yield falling with various positive factors like the continuation of government in centre, benign inflation etc. The yield also saw spikes due to increase in core inflation and concerns about fiscal deficit which was offset by RBI's Open market intervention. 69 69 70 70 During the financial year 2019-20, Indian Rupee weakened against USD by 9.4% and the major reason being US China trade war and Corona Virus outbreak. Indian Rupee against USD opened at `69.15 and closed at `75.66. The large FPI outflows towards the second half of FY aggravated the situation. Compared to other currencies, Indian Rupee performed better with RBI's intervention. The low crude oil prices kept the rupee from weakening further. With a healthy foreign exchange reserves, the Indian Rupee remained at a comfort zone against USD. 71 71 72 72 73 -Financial Overview 67 += Financial Overview = 74 74 75 75 Given the market conditions, the Bank recorded a moderate growth rate during the year. The credit growth remaining subdued during the year, the biggest challenge faced by the Banking system was dealing with stressed assets, restructured debts and NPA accounts. Despite these challenges, the Bank was able to post a 5% growth in its total business, with Deposits growing by 6% and Gross Advances growing by 5%. The total business of the Bank as on March 31, 2020 stood at Rs 75,408 crore. 76 76 ... ... @@ -91,120 +91,98 @@ 91 91 Return on Assets of the Bank for the FY 2019-20 stands at 1% and Return on Equity was at 9.47. The basic earnings per share stood at Rs 6.48 per share as compared to Rs 9.57 per share last year. The book value per share of the Bank increased from Rs 65.91 to Rs 71.83 as on March 31, 2020 as compared to previous year. 92 92 93 93 94 -Recent developments 88 += Recent developments = 95 95 90 +**City Union Bank September 2020 Net Interest Income (NII) at Rs 475.14 crore.**{{footnote}}https://www.indiainfoline.com/article/news-sector-banking-financials/city-union-bank-reports-net-profit-of-rs58cr-in-q2-stock-up-over-1-5-120110300587_1.html{{/footnote}} 96 96 97 - CityUnionBankSeptember2020 Net Interest Income(NII) at Rs 475.14crore.92 +== Financial Performance Q2FY2021 == 98 98 99 -[[https:~~/~~/www.indiainfoline.com/article/news-sector-banking-financials/city-union-bank-reports-net-profit-of-rs58cr-in-q2-stock-up-over-1-5-120110300587_1.html>>url:https://www.indiainfoline.com/article/news-sector-banking-financials/city-union-bank-reports-net-profit-of-rs58cr-in-q2-stock-up-over-1-5-120110300587_1.html]] 100 100 101 - FinancialPerformanceQ2FY2021:95 +**Net Interest Income** 102 102 103 - 104 -~1. Net Interest Income 105 - 106 - 107 107 The Bank earned a Net Interest Income of Rs475cr as against Rs412cr for the same period as compared to last year. 108 108 109 109 110 - 2.Non Interest Income100 +**Non Interest Income** 111 111 112 - 113 113 Non Interest Income of the Bank is at Rs169cr in Q2FY2021 as against Rs195cr for Q2FY 20. The income earned on CEB & Charges decreased by Rs11crs from Rs76cr in Q2FY 20 to Rs65cr in Q2FY21 based on the instructions from Finance Ministry wrt waiver of charges due to COVID impact in Q1 FY21. The treasury income reduced to Rs69cr in Q2FY21 Vs Rs79crs in Q2FY 20. 114 114 115 115 116 - 3.Operating Expenses105 +**Operating Expenses** 117 117 118 - 119 119 The operating expense for Q2FY21 is at Rs260cr and was same during the previous year. Establishment expenses increased from Rs113cr in Q2FY 20 to Rs120cr in Q2FY21 and all other operating expenses marginally decreased from Rs147cr to Rs140cr in Q2FY21. 120 120 121 121 122 - 4.Operating Profit110 +**Operating Profit** 123 123 124 - 125 125 Thus, the Operating Profit for Q2FY2021 was Rs385cr as against Rs347cr for the same period as compared to the last year. 126 126 127 127 128 - 5.Provisions115 +**Provisions** 129 129 130 - 131 131 The Bank already holds a provision of Rs225cr for Covid-19 as on June 30, 2020 and during the current quarter the Bank has made an additional provision of Rs115cr to meet any future contingency arising out of Covid pandemic. Thus, the total provision in this regard held by the bank as on 30th September 2020 is Rs340cr. 132 132 133 133 134 - 6.Net Profit120 +**Net Profit** 135 135 136 - 137 137 The Bank’s Profit after Tax was at Rs158cr in Q2FY2021 as against Rs194cr in Q2FY 2020. Profit Before Tax for the quarter was impacted on account of additional provision made to the tune of Rs115cr towards Covid to meet any future contingency. 138 138 139 139 140 - 7.Deposits125 +**Deposits** 141 141 142 - 143 143 Total Deposits of the bank marginally increased by 2% for Q2FY2021 to Rs41,421cr from Rs40,451cr for the same period as compared to last year. City Union Bank has not pushed for growth because of covid and to protect the margins along with optimum level ofcredit deposit ratio, the deposit position was kept muted in H1 FY21. However, the company will push for growth if situation warrants by way of any surge in advances in the second half of FY21. CASA increased by 7% from Rs9,988cr to Rs10,645cr (Y-o-Y). CASA portion stood at 25.70% to total deposits. Cost of Deposits decreased to 5.54% from 6.25% in Q2FY 20. 144 144 145 145 146 - 8.Advances130 +**Advances** 147 147 148 - 149 149 Total Advances increased by 6% for Q2FY2021 to Rs35,437cr from Rs33,279cr in Q2FY 2020.credit Deposit ratio stood at 86%. The yield on Advances decreased to 10.21% in Q2FY21 from 10.76% in Q2FY 20. 150 150 151 151 152 - 9.Asset Quality135 +**Asset Quality** 153 153 154 - 155 155 The Gross NPA as on September 30, 2020 was at 3.44% and Net NPA was at 1.81% (Gross NPA as on June 30, 2020 was at 3.90% and Net NPA was at 2.11%). The Provision Coverage Ratio as on September, 2020 was at 70%. No addition to NPA during Q2FY21 because of standstill clause as per the direction of Supreme Court. Due to that Net NPA stands reduced to 1.81% in Sep-20 from 2.29% in Mar-20. 156 156 157 157 158 - 10.Net Interest Margin140 +**Net Interest Margin** 159 159 160 - 161 161 Net Interest Margin stood at 4.12% in Q2FY21 Vs 3.91% in Q2FY20. NIM has increased sequentially from 3.98% in Q1FY21 to 4.12% in Q2FY21. 162 162 163 163 164 - ~11.Capital Adequacy145 +**Capital Adequacy** 165 165 166 - 167 167 As on September 30, 2020 the Capital Adequacy Ratio increased to 17.36% (With Tier I 16.29% and Tier II 1.07% as per Basel III norms). RWA reduced from Rs32,462cr in Mar-20 to Rs30,912cr in Sep-20 mainly due to sanction of ECLGS & increase in Gold loans during H1 FY21. 168 168 169 169 170 - 12.Return on Assets150 +**Return on Assets** 171 171 172 - 173 173 Return on assets for the quarter is 1.23% as against 1.62% for the same period of last year. 174 174 175 175 176 - 13.Return on Equity155 +**Return on Equity** 177 177 178 - 179 179 Return on Equity was at 11.50% in Q2FY2021 as compared to 15.18% in Q2FY2020. 180 180 181 181 182 - 14.Cost Income Ratio160 +**Cost Income Ratio** 183 183 184 - 185 185 Cost to Income Ratio reduced to 40.31% in Q2FY2021 from 42.87% in Q2FY 2020. The reduction was on account of improvement in Net Interest Income. 186 186 187 187 188 - 15.Moratorium165 +**Moratorium** 189 189 190 - 191 191 The Bank has extended the option to all the borrowers to avail moratorium as per the RBI instructions. During June quarter accounts covering an exposure of 1.76% of CC & 26.54% of Term loan, on total 12.45% of exposure did not received even single payment utilizing moratorium fully. That number currently stands at 0.65% of CC exposure, 19.12% of Term loan exposure and 9.03% of total exposure, where not even a single payment received during moratorium period. Out of them, 0.10% of cc exposure, 10.76% term loan exposure & 4.94% of total exposure have paid the demand portion of one monthly installment in the month of September 2020. Of the balance 4.09% of exposure have not paid anything till now, the company expect many of them would opt for restructuring since the time is available upto 31.12.2020 for NonMSME and 31.03.2021 for MSME. 192 192 193 193 194 - 16.ECLGS170 +**ECLGS** 195 195 196 - 197 197 Across business lines, upto October 2020, the Bank has sanctioned Rs1967cr and disbursed Rs1,691crs under the ECLGS. 198 198 199 199 200 - 17.Restructure175 +**Restructure** 201 201 202 - 203 203 In terms of RBI Circular DOR No.BP.BC.34/21.04.048/2019-20 dt 11.02.2020 and DOR.No.BP.BC/4/21.04.048/2020-21 dated 06.08.2020 - Restructuring of Advances, the bank has restructured 11 Standard accounts to the tune of Rs79cr in Q2FY2021. As of H1 FY21, the total outstanding restructured Standard accounts was 175 in numbers and amounting to Rs478cr. The Bank hold a provision of Rs14cr against the requirement of Rs13cr towards Restructured Standard accounts. 204 204 205 205 180 += References = 206 206 207 - 208 -References 209 - 210 210 {{putFootnotes/}}