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Au Small Finance Bank has reported 13% decline in net
profit at Rs 278.51 crore for the quarter ended September 2021, mainly on
account of higher base. The net profit has increased 42% YoY excluding gains from
stake sale in Aavas of Rs 144 crore in in Q2FY21.
The bank has posted healthy 34%
growth in net interest income (NII), while the non-interest income of the bank declined
27% in Q2FY2022. The Net Interest Margin (NIM) of the bank improved to 6.00% in
Q2FY2022 compared to 5.10% in the corresponding quarter of previous year.
On business front, the loan
book of the bank has surged 24% to Rs 38011 crore end September 2021, while the
bank has continued to maintain asset quality stable in Q2FY2022. The CASA ratio
of the bank has moved up to 30.0% at end September 2021.
Asset
Quality: The bank has maintained stable asset quality in
Q2FY2022.
GNPA reduced sequentially by Rs 345 Cr to Rs 1151 Cr
(3.2%) from Rs 1496 Cr (4.3%). Net NPA reduced to 1.7% from 2.3% QoQ. Going
forward, Bank will assess GNPA pool and look to write off loans with low
recoverability.
The fresh slippages of loans
stood at Rs 210 crore in Q2FY2022, while the recovery, upgradations and
write-off together were higher at Rs 555 crore.
Average Collection efficiency in Q2’FY22 at 109%. Trends
in collection efficiency and customer activation have sustained (versus June 2021)
and are at pre covid levels (February 2020)
Bank has utilized the entire provision released due to
GNPA reduction towards further building up buffer provisions
Bank has created additional contingency provision of Rs 110
Crore, by utilizing the entire provision released due to GNPA reduction,
towards further building up of buffer provisions to further strengthen the balance
sheet
Bank has done Rs 80 Crore of covid related standard
restructuring in Q2 and bank had total standard Restructured book of Rs 1302
Crore which is 3.6% of gross advances.
Given the experience with the restructured book so far, the
bank believes that the extant 16% coverage against the standard restructured
loans seems adequate currently
The Bank now carries total contingency provision of Rs 362
Crore. Excluding the contingency provision of Rs 62 Crore against restructured
assets, contingency provisions stood at Rs 300 Crore which is 0.84% of Net
Advances.
Bank remains well capitalized with a strong Tier-I
capital ratio of 20.5% and total CRAR of 22% (sufficiently above minimum
requirement of 7.5% and 15% respectively)
Bank’s average LCR was 151%
for Q2’FY22 (against regulatory requirement of 100%).
The Provision Coverage ratio
stood at 49.0% at end September 2021.
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Asset Quality
Indicators: AU Small Finance Bank
|
|
|
Sep-21
|
Jun-21
|
Mar-21
|
Dec-20
|
Sep-20
|
Variation
|
|
QoQ
|
YTD
|
YoY
|
|
Gross NPA (Rs Crore)
|
1151.45
|
1495.94
|
1502.83
|
302.74
|
423.17
|
-23
|
-23 |
172
|
|
Net NPA (Rs Crore)
|
591.48
|
765.99
|
755.45
|
72.69
|
122.83
|
-23
|
-22 |
382
|
|
% Gross NPA
|
3.16
|
4.31
|
4.25
|
0.99
|
1.54
|
-115
|
-109 |
162
|
|
% Net NPA
|
1.65
|
2.26
|
2.18
|
0.24
|
0.45
|
-61
|
-53 |
120
|
|
% Provision Coverage
Ratio
|
49.00
|
49.00
|
50.00
|
76.00
|
71.10
|
0
|
-100
|
-2210
|
|
% CRAR - Basel III
|
21.95
|
23.07
|
23.37
|
18.84
|
21.47
|
-112
|
-142
|
48
|
|
Tier I - Basel III %
|
20.50
|
21.60
|
21.50
|
16.30
|
18.30
|
-110
|
-100
|
220
|
|
Variation in basis
points for figures given in percentages and in % for figures in Rs crore
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Business
Highlights:
The bank has posted improved
38% growth in business to Rs 74879 crore end September 2021, driven by 32%
surge in the advances to Rs 35845 crore and 45% jump in the deposits to Rs 39034
end September 2021 over September 2020.
Deposits continue to scale with customer profile becoming
more granular. Total deposits grew by 45% to Rs 39034 crore of which Rs 26123
Crore are term deposits. CASA ratio grows to 30.3% end September 2021 from 19.8%
end September 2020. SA accretion contributed the entire incremental deposits in
the quarter
Total Loan AUM increased 24% to reach Rs 38011 Crore. Disbursements
grew by 57% to Rs 5135 crore in Q2FY22 as operating environment and economic
activity improved significantly.
The bank has a network of
811 branches and 470 ATMs spread across 15 states and 2 union territories end
September 2021. The bank has improved its customer base to 21.3 lakh end
September 2021.
Book value of the bank stood
at Rs 214.1 per share at end September 2021, while the adjusted book value (net
of NNPA and 10% of restructured advances) was Rs 191.1 per share at end
September 2021.
Quarterly Performance
NII
surges on strong loan growth and higher margins:
Bank has recorded 16% increase in the interest earned at Rs 1404.75 crore, while
interest expenses was flat at Rs 651.62 crore in Q2FY2022. NII improved 34% to
Rs 753.13 crore in the quarter ended September 2021. Cost of funds in H1’FY22
reduced by 89 bps YoY to 6.2% from 7.1%
Non-interest
income declines: Bank has posted 27% decline in non-interest
income to Rs 191 crore in the quarter ended September 2021. The loan assets
processing & other fees surged 68% to Rs 94 crore, followed by general
banking & deposits related fees rising 33% to Rs 36 crore, followed bycross
sell, distribution related fees & others 67% to Rs 5 crore and pslc premium
/ fees 513% to Rs 49 crore. However, the income from sale of mf & other
assets dipped 74% to Rs 6 crore. Other income fell 27% to Rs 190 crore.
Expenses
ratio rises: The operating expenses of the bank increased
45% to Rs 552.58 crore, as other expenses moved up 45% to Rs 225.82 crore, while
employee expenses jumped 46% to Rs 326.76 crore in Q2FY2022. Cost to income
ratio jumped 58.5% in Q2FY2022 compared with 46.3% in Q2FY2021, causing 11%
decline in the operating profit to Rs 391.45 crore.
Increase in opex YoY due to increase in employee base, as
well as investments in brand, products and people towards franchise building. Cost
to income for H1FY22 is within target range of 50-55%. Excluding investments in
brand building, QR, credit cards, video banking, Cost/Income is close to 50%.
Provisions
and contingencies dip: The bank has showed 89% dip in
provisions to Rs 3.60 crore. the bank has written back NPA provisions of Rs 58.00
crore. The write off were nil, while repossession Loss was Rs 43.00 crore.
Effective tax rate increased
to 28.2% in Q2FY2022 from 21.3% in Q2FY2021. Net Profit declined 13% YoY to Rs 278.51
crore during quarter ended September 2021.
Financial Performance H1FY2022:
Bank has posted 8% decline in
net profit to Rs 481.71 crore in the half year ended September 2021 (H1FY2022).
The net interest income increased 37% to Rs 1477.15 crore, while non-interest
income dipped 17% to Rs 404.96 crore. The net total income increased 20% to Rs 1882.11
crore in H1FY2022. The operating expenses increased 49% to Rs 1009.54 crore, while
provision and contingencies fell 2% to Rs 210.06 crore, allowing profit before
tax to declined 2% to Rs 662.51 crore in H1FY2022. The cost-to-income ratio increased
to 53.6% in H1FY2022 compared to 43.3% in H1FY2021. An effective tax rate rose to
27.3% in H1FY2022 compared to 22.4% in H1FY2021. The net profit has declined 8%
to Rs 481.71 crore in H1FY2022.
|
AU Small Finance Bank:
Results
|
|
Particulars
|
2109 (3)
|
2009 (3)
|
Var %
|
2109 (6)
|
2009 (6)
|
Var %
|
2103 (12)
|
2003 (12)
|
Var %
|
|
Interest Earned
|
1404.75
|
1212.45
|
16
|
2758.25
|
2396.57
|
15
|
4950.05
|
4285.88
|
15
|
|
Interest Expended
|
651.62
|
651.82
|
0
|
1281.10
|
1320.08
|
-3
|
2584.61
|
2376.94
|
9
|
|
Net Interest Income
|
753.13
|
560.63
|
34
|
1477.15
|
1076.49
|
37
|
2365.44
|
1908.94
|
24
|
|
Other Income
|
190.90
|
261.00
|
-27
|
404.96
|
486.53
|
-17
|
1451.55
|
706.09
|
106
|
|
Net Total Income
|
944.03
|
821.63
|
15
|
1882.11
|
1563.02
|
20
|
3816.99
|
2615.03
|
46
|
|
Operating Expenses
|
552.58
|
380.02
|
45
|
1009.54
|
676.08
|
49
|
1658.42
|
1417.86
|
17
|
|
Operating Profits
|
391.45
|
441.62
|
-11
|
872.57
|
886.94
|
-2
|
2158.57
|
1197.17
|
80
|
|
Provisions &
Contingencies
|
3.60
|
32.71
|
-89
|
210.06
|
213.70
|
-2
|
700.06
|
283.20
|
147
|
|
Profit Before Tax
|
387.85
|
408.91
|
-5
|
662.51
|
673.24
|
-2
|
1458.51
|
913.97
|
60
|
|
Provisions for Tax
|
109.33
|
87.03
|
26
|
180.79
|
150.56
|
20
|
287.82
|
239.19
|
20
|
|
Net Profit
|
278.51
|
321.88
|
-13
|
481.71
|
522.69
|
-8
|
1170.69
|
674.78
|
73
|
|
EPS*(Rs)
|
35.5
|
41.1
|
|
30.7
|
33.3
|
|
37.3
|
21.5
|
|
|
* Annualized on
current equity of Rs 313.56 crore. Face Value: Rs 10, Figures in Rs crore,
|
|
Source: Capitaline
Corporate Database
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