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Karur Vysya Bank has
reported strong 56% growth in net profit at Rs 289.29 crore for the quarter
ended December 2022 (Q3FY2023). The bank has posted robust 29% growth in net
interest income (NII), while the core fee income of the bank also improved 14%
in Q3FY2023. The Net Interest Margin (NIM) of the bank improved to 4.32% in
Q3FY2023 compared to 3.68% in the corresponding quarter of previous year.
On business front, the bank as has posted 15%
growth in business with strong 16% surge in loan book. The asset quality of the
bank was stable in Q3FY2023. Bank has improved the credit to
deposit ratio to 84.7% at end December 2022 from 83.4% at end December 2021.
However, the CASA ratio of the bank has declined to 33.9% at end December 2022
from 36.1% at end December 2021.
Asset quality improves: The bank has improved stable asset quality with
lower slippages of loans and healthy recoveries of NPAs in Q3FY2023.
The fresh slippages of loans stood at Rs 162
crore in Q3FY2023 compared with 131 crore in previous quarter.
The recoveries and upgradations of NPAs stood at
Rs 191 crore and the write-off of loans was at Rs 754 crore in Q3FY2023.
The standard restructured loan book of the bank declined
to Rs 1160 crore end December 2022.
Provision coverage ratio improved to 90.87% at
end December 2022 compared to 86.94% a quarter ago and 78.81% a year ago.
The capital adequacy ratio of the bank stood at
17.9% with Tier I ratio at 17.9% at end December 2022.
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Asset Quality
Indicators: Karur Vysya Bank
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Dec-22
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Sep-22
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Jun-22
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Mar-22
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Dec-21
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Variation
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QoQ
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YTD
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YoY
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Gross NPA (Rs Crore)
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1674.34
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2456.53
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3107.17
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3431.04
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3887.52
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-32
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-51
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-57
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Net NPA (Rs Crore)
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550.43
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818.72
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1098.36
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1260.79
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1355.57
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-33
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-56
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-59
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% Gross NPA
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2.66
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3.97
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5.21
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5.96
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6.97
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-131
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-330
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-431
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% Net NPA
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0.89
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1.36
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1.91
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2.28
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2.55
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-47
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-139
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-166
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% PCR
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90.87
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86.94
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82.74
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80.27
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78.81
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393
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1060
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1206
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% CRAR - Basel III
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17.86
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18.31
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19.21
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19.46
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18.79
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-45
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-160
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-93
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% CRAR - Tier I -
Basel III
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17.86
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16.42
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17.25
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17.49
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16.76
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144
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37
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110
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Variation in basis
points for figures given in percentages and in % for figures in Rs crore
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Highlights:
Healthy business growth: The business of the bank has increased 15% YoY
to Rs 140683 crore end December 2022, driven by 16% surge in advances to Rs
64508 crore. Deposits rose 14% to Rs 76175 crore at end December 2022.
CASA deposits ratio eases: The CASA deposits of the bank increased 7% YoY
to Rs 25800 crore at end December 2022. The CASA ratio eased to 33.9% at end
December 2022 compared to 36.1% at end December 2021, while declined from 35.2%
a quarter ago.
Strong loan growth: Advances growth was driven by retail loans
rising 12% YoY to Rs 14507 crore at end December 2022, while credit to
agriculture increased 17% to Rs 14623 crore and MSME 14% to Rs 20610 crore at
end December 2022. The corporate credit has jumped 20% to Rs 14768 crore end
December 2022.
Investment
book of the bank increased 10%
YoY to Rs 19386 crore at end December 2022. The AFS book jumped 27% to Rs 3757
crore, while HTM book rose 6% to Rs 15629 crore at end December 2022. The
duration of the overall investment portfolio stood at 2.9 years end December
2022 compared with 3.2 years at end December 2021.
Margins improve: The bank has showed 4 bps YoY rise in cost of
deposits to 4.26%, while yield on advances surged 62 bps YoY to 9.04% in
Q3FY2023. Thus, the NIM has improved 64 bps YoY to 4.32%.
Branch expansion: The bank has network of 792 branches and 2233
ATM`s end December 2022.
Book value of the bank stood at Rs 102.8 per share at end December 2022,
while the adjusted book value (net of NNPA and 10% of restructured advances)
was Rs 94.5 per share at end December 2022.
Quarterly Performance
NII rises as NIM improves: Bank has recorded 21% increase in the interest
earned at Rs 1695.22 crore, while interest expenses increased 12% to Rs 806.22
crore in Q3FY2023. NII improved 29% to Rs 889.00 crore in the quarter ended
December 2022.
Healthy growth in the core fee income: Bank has posted strong 14% growth in core fee
income to Rs 184 crore, while the other income jumped 291% to Rs 133 crore supporting
62% jump in the overall non-interest income to Rs 317.49 crore in the quarter
ended December 2022.
Expenses ratio dips: The operating expenses of the bank increased 8%
to Rs 517.54 crore, as other expenses moved up 10% to Rs 261.83 crore, while
employee expenses rose 5% to Rs 255.71 crore in Q3FY2023. Cost to income ratio dipped
42.9% in Q3FY2023 compared with 54.5% in Q3FY2022, helping the Operating Profit
to increase 72% to Rs 688.95 crore.
Provisions and contingencies jump: The bank has showed 149% surge in provisions to
Rs 364.09 crore. The loan loss provisions galloped 148% to Rs 290 crore, while investment provisions increased to
Rs 102 crore. However, the bank has
written back standard asset provisions of Rs 8 crore and other provisions of Rs
20 crore.
Effective tax rate declined to 10.9% in Q3FY2023 from 27.4% in Q3FY2022. Net
Profit rose by 56% YoY to Rs 289.29 crore during quarter ended December 2022.
Financial Performance 9MFY2023:
Bank has posted 67% increase in net profit to Rs
768.27 crore in the nine months ended December 2022 (9MFY2023). The net
interest income increased 22% to Rs 2456.23 crore, while non-interest income
moved up 36% to Rs 758.13 crore, pushing up net total income by 25% to Rs
3214.36 crore in 9MFY2023. The operating expenses increased 7% to Rs 1477.62
crore, while provision and contingencies galloped 34% to Rs 745.92 crore,
allowing profit before tax to increase 57% to Rs 990.82 crore in 9MFY2023. The
cost-to-income ratio improved to 46.0% in 9MFY2023 compared to 53.8% in
9MFY2022. An effective tax rate declined to 22.5% in 9MFY2023 compared to 27.0%
in 9MFY2022. The net profit has increased 67% to Rs 768.27 crore in 9MFY2023.
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Karur Vysya Bank: Results
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Particulars
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2212 (3)
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2112 (3)
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Var %
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2212 (9)
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2112 (9)
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Var %
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2203 (12)
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2103 (12)
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Var %
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Interest Earned
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1695.22
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1404.51
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21
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4748.23
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4178.40
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14
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5587.67
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5470.42
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2
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Interest Expended
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806.22
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717.28
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12
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2292
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2172.96
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5
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2872.30
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3110.91
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-8
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Net Interest Income
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889
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687.23
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29
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2456.23
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2005.44
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22
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2715.37
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2359.51
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15
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Other Income
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317.49
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195.61
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62
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758.13
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559.29
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36
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769.06
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918.82
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-16
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Net Total Income
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1206.49
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882.84
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37
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3214.36
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2564.73
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25
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3484.43
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3278.33
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6
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Operating Expenses
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517.54
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481.25
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8
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1477.62
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1380.12
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7
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1854.22
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1986.83
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-7
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Operating Profits
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688.95
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401.59
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72
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1736.74
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1184.61
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47
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1630.21
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1291.50
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26
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Provisions &
Contingencies
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364.09
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146.10
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149
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745.92
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554.88
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34
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699.29
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757.13
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-8
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Profit Before Tax
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324.86
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255.49
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27
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990.82
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629.73
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57
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930.92
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534.37
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74
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Provision for tax
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35.57
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70.01
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-49
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222.55
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169.93
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31
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257.65
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174.98
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47
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PAT
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289.29
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185.48
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56
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768.27
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459.80
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67
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673.27
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359.39
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87
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EPS*(Rs)
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14.4
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9.3
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12.8
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7.6
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8.4
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4.5
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Adj BV (Rs)
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94.5
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73.3
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94.5
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73.3
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77.1
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64.4
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* Annualized on current equity of
Rs 160.35 crore. Face Value: Rs 2, Figures in Rs crore
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Source: Capitaline Corporate
Database
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