Bandhan Bank Q3 results, Profit more than doubles

Bandhan Bank on Tuesday reported a 120.85 per cent year-on-year (YoY) rise in net profit at Rs 731 crore for the December quarter compared with Rs 331 crore in the same quarter last year.

The numbers are not comparable as the third quarter results included figures for Gruh Finance, which was merged with the bank with effect from October 17, 2019.

The bank said its net interest income (Nil) jumped 37.10 per cent to Rs 1,541 crore for the quarter edned December 2019. This was against Rs 1,124 crore in the year-ago quarter.

Non-interest income rose 52.99 per cent to Rs 358 crore from Rs 234 crore on a YoY basis.

Net interest margin for the quarter came in at 7.9 per cent for the merged entity (including Gruh Finance) against 10.5 per cent (standalone) in the same quarter last year. Gross NPAs for the merged entity stood at 1.9 per cent compared with 2.4 per cent YoY on a standalone basis.

Chandra Shekhar Ghosh said: "During the quarter, the bank made additional provision of Rs 200 crore on standard advances in microfinance portfolio after evaluating risk observed in certain areas of a north eastern state, though having a dwindling effect. Last quarter has witnessed strong customer growth on advances and deposit growth has been highest over last four quarter. I am positive and confident on the business and growth going forward."

The company added 7.3 lakh customers during the quarter with total customer base at 1.9 crore as on December 31, the company said in a BSE filing.

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IndusInd Bank Q3 result, asset quality worsens

Private lender IndusInd Bank on Tuesday posted 32 per cent year-on-year rise in profit at Rs 1,300 crore for the quarter ended December 31, thanks to a healthy growth in retail and treasury revenue.

However, spike in provisions and worsening asset quality remains main concerns.

Romesh Sobti, Managing Director & CEO of Induslnd Bank said: "During Q3FY20, the bank witnessed a healthy growth in its topline as well as in operating profit. We reached a milestone as the balance sheet footage crossed Rs 3 lakh crore and advances crossed the Rs 2 lakh crore mark. PCR increased to 53 per cent to strengthen the balance sheet. We look forward to moving into the subsequent quarters with renewed momentum."

Here are the key takeaways from the bank’s Q3 earnings:

Provisions spike

Provisions for bad loans jumped as IndusInd Bank kept aside Rs 1,043.45 crore in the December quarter this fiscal compared with Rs 606.68 in the same quarter a year ago. This translates into a jump of 72 per cent.

Employee costs jump

Employee costs jumped 22 per cent to Rs 550 crore from Rs 452 crore. This can be explained by a significant number of branch additions by the lender. The bank operates via 1,851 branches now against 1,558 branches as on December 31, 2018.

Asset quality drops

Asset quality of the bank worsened year-on-year as gross non-performing assets (NPA) more than doubled to Rs 4,578 crore from Rs 1,968.15. In percentage terms it went up to 2.18 per cent from 1.13 per cent a year ago. Net NPA edged higher to 1.05 per cent to 0.59 per cent.

Retail revenue grows 32 per cent

Revenue from retail business rose 31.6 per cent year-on-year to Rs 5,026 crore from Rs 3,819 crore. Treasury operations also saw a strong growth of 25 per cent to Rs 1,460 crore while revenue from corporate banking lagged, growing at just 9.3 per cent to Rs 2,589 crore.

NII rises 34 per cent

Net Interest Income (Nll) for the quarter was at Rs 3,074 crore against Rs 2,288 crore in the corresponding quarter last year, registering a growth of 34 per cent. Non-interest income for the quarter was at Rs 1,790 crore compared with Rs1,469 crore, a growth of 22 per cent.

Loans portfolio grows 20 per cent

Total advances as of December 31, was Rs 2,07,414 crore compared with Rs 1,73,169 crore on December 31, 2018, recording a growth of 20 per cent.

Total deposits as on December 31, was at Rs 2,16,713 crore against Rs 1,75,701 crore, up by 23 per cent. Total business of the bank stood at Rs 4,24,127 crore.

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This Private Bank's existance is in trouble - Which bank is capable to digest it?

Before it results in a tragedy for all of India’s banking, regulators need to step in and end the farce called Yes Bank Ltd. The latest shenanigans make it very clear that the authorities need to stop being spectators — and act.

The original cast has vanished. The co-founder who drove the country’s fifth largest private-sector bank into a ditch of bad corporate loans has sold out. Institutional shareholders are heading for the exit. Retail investors left holding more and more of the stock are waiting for lifesaving capital.

The new management keeps dangling improbable funding options — ranging from an unnamed global technology firm to a Canadian businessman living in a motel — only to strike them off the list of white knights.

Day Traders' Delight

The only thing ticking at the bank is the clock. Common equity tier 1 may just about manage to stay above the regulatory threshold of 8% by March. But 36% of capital is tied up in bad debt that’s yet to be provided for. More loan losses lie around the corner. With 40% of deposits coming from fickle wholesale sources, solvency and liquidity risks are high.

At a time when India’s financial system is choking on hundreds of billions of dollars of bad loans, the news coming out of Yes still manages to shake confidence.On Friday, the lender announced that the head of the board’s audit committee, appointed under previous management, had quit. Following whistle-blower allegations of undisclosed past criminal cases, the bank was examining whether Uttam Prakash Agarwal was “fit and proper” to be a director.

But Agarwal, who says the missed disclosures were an omission, pulled the trigger first. In a letter, he called for a forensic audit of the fundraising process — and its communication to the board and the public — to probe if it was “false, misleading or distorted.” The stock, down 88% over the past 17 months, fell more than 5% on Friday.

Following Agarwal’s salvo, the only way Chief Executive Officer Ravneet Gill can salvage the situation and his own reputation is by quickly raising around 3% of risk-weighted assets worth of capital. That’s a bare minimum. Yet after nearly a year in the job, the ex-Deutsche Bank AG veteran has little to show for his efforts. Most recently, the board ruled out taking money from Erwin Braich, the mysterious Canadian investor. And that, as far as one can see, is the end of the road in Gill’s search for an investor who will write a check in excess of $1 billion for a lender that’s still hurtling down a rabbit hole.

Fault Lines

An independent existence for Yes is increasingly unrealistic. There’s no safe way to shut it down without inviting system-wide panic. Depositors are already on the edge, trapped in a cooperative bank that failed. What else can be done?

I’ve previously explored the possibility of a merger with Kotak Mahindra Bank Ltd., which like Yes is also a private-sector lender. But Chairman Uday Kotak, whose good fortune has been all about saying no to loans to which Yes said yes, seems uninterested.

State Bank of India, India’s largest commercial lender by assets, may hate the idea of a forced merger. But let’s face it: No other banking balance sheet in India might be able to take over a lender with more than $31 billion in advances. More importantly, the SBI is a public-sector bank; if CEO Rajnish Kumar can be prevailed upon to swallow Yes, he can always be given some taxpayers’ funds to help with the indigestion.

Who Can Digest Yes?

Time is not on India’s side. Nominal GDP is expanding at its slowest in more than four decades. An implosion at the bank will be awful news for construction, real-estate and shadow banking, three crucial sectors starved of funding that comprise a quarter of Yes Bank’s loan book. This negative feedback loop could be more damaging to confidence than even the surprise bankruptcy of infrastructure financier IL&FS Group in September 2018, which led to an economy-wide surge in borrowing costs.

After Agarwal’s letter to the stock exchanges, the regulator and the government, none can pretend to be in the dark any longer about the state of affairs at Yes Bank. It’s time they brought the curtain down on this theater of the absurd.

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Updates of today's meeting of 11th Bipartite Settlement

IBA team was led by IBA Chairman Mr. Rajnish Kumar, who is Chairman of SBI.

The following discussion took place :

1. Revised Offer : The offer for hike in Fixed Pay was enhanced from 12% to 12.25 % on pay slip. This offer is with 2% loading. "In view of overall difficult financial condition of Banks, it is not possible to go beyond this offer," was made clear by IBA. 

2. Special Allowance : Due to extra financial burden IBA refused the Demand for Merger of Spl Allowance with Basic.

3. Five Day Week : IBA flatly refused this Demand raised once again.

4. PL Encashment : At present PL can be encashed (i) on retirement (ii) while availing LFC.

A NEW channel for PL Encashment will be introduced. Employees can encash 5 days' PL every year against available balance.

As special case, those employees having less than 5 years' remaining service, shall be able to encash 7 day PL every year against balance available. 

5. Family Pension : IBA is working on enhancing it. They have accepted that it is not adequate.

6. Pension : For enhancement, cost factor is prohibitive. IBA is working on it. But they have not committed anything in this regard.

7. Performance Linked Incentive (PLI) :

As per suggestions made by Unions IBA came out with Revised Offer as under : 

It is payable on year on year increase in Operating Profit.

(A) If Operating Profit increase is between 5 to 10 %, the Incentive will be 2.75 % which equals 10 days' salary.

(B) if Operating Profit increases by 10 to 15 %, the Incentive will be 3.84 % which equals 14 days' salary.

(C) if Operating Profit increases by 15% & above, Incentive will be 5.75 % which equals 21 days' salary.

(D) For those Banks which could not register NET PROFIT, but it's Operating Profit increase is above 5% : the PLI will be @ 2.75% or 10 Days' salary.

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Tentative date of results of Private banks for Q3FY20

Bank	Result Date
Axis Bank	22 Jan,2020
Bandhan Bank	14 Jan,2020
City Union Bank	12 Feb,2020
DCB Bank	25 Jan,2020
Dhanlaxmi Bank	04 Feb,2020
Federal Bank	20 Jan,2020
HDFC Bank	18 Jan,2020
ICICI Bank	25 Jan,2020
IDBI Bank	11 Feb,2020
IDFC First Bank	29 Jan,2020
IndusInd Bank	14 Jan,2020
Jammu & Kashmir Bank	Jan,2020
Karnataka Bank	16 Jan,2020
Kotak Mahindra Bank	20 Jan,2020
Karur Vysya Bank	1 Feb,2020
Lakshmi Vilas Bank	14 Feb,2020
RBL Bank	22 Jan,2020
South Indian Bank	16 Jan,2020
Yes Bank	Jan,2020

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Saving Bank Accounts for NRIs-Difference between NRE & NRO Acs-Required Documents

NRE Savings Account

# NRIs (individuals/entities of Bangladesh/Pakistan nationality/ownership require prior approval of RBI).

# Joint Account facility

Account can be held jointly by a NRI (persons of Indian nationality or origin) / with a Resident Indian (Former or Survivor basis). A Resident Indian can operate the account only as a Mandate / POA holder. The Resident Indian must be a close relative as defined in Section 6 of the Companies act, 1956.

# Currency in which account maintained

Indian Rupees (INR)

# Repatriation

Principal and interest are fully repatriable

# Mandate Holder

An Indian resident can be authorized to operate the account and provided with an ATM card for the account

# Interest Rate

Rate as advised by Bank from time to time as per stipulated guidelines and will be displayed on the website

# Taxation

Interest earned is exempted from Tax in India

NRO Savings Account

·         # Any person resident outside India (other than a person resident in Nepal and Bhutan).

·         Individuals/entities of Pakistan Nationality/ownership, entities of Bangladesh ownership and erstwhile Overseas Corporate Bodies require prior approval of Reserve Bank of India.

# Joint Account facility- Account can be held jointly by a NRI (persons of Indian nationality or origin) / with a Resident Indian

·         # Currency in which account maintained

·         Indian Rupees (INR)

# Repatriation

RBI allows repatriation only for i) current income ii) up to USD one million per financial year (April-March), for any bonafide purpose after payment of applicable taxes.

# Mandate Holder

An Indian resident can be authorized to operate the account and provided with an ATM card for the account

# Interest Rate

Rate as advised by Bank from time to time as per stipulated guidelines and will be displayed on the website

# Taxation

Interest is taxable under Indian Income Tax Act

RFC Savings Account for Returning NRIs

# A Resident Foreign Currency Savings Account can be opened by NRIs who have returned for permanent settlement after being resident outside India for a continuous period of not less than one year. These funds can be transferred to an NRE/FCNR account upon change of status to NRI again.

# Joint Account facility

Account can be held jointly by eligible Returning NRI with a Resident Indian (Former or Survivor basis). The Resident Indian must be a close relative as defined in Section 6 of the Companies act, 1956.

# Currency in which account maintained

US Dollar (USD), Great Britain Pound (GBP)

# Repatriation

 Funds are repatriable for bonafide purposes

# Mandate Holder

  N.A.

# Interest Rate

 Rate as advised by Bank from time to time as per stipulated guidelines and will be displayed on the website

# Taxation

 Interest earned is exempted from Tax in India provided Resident but Not Ordinarily Resident (RNOR) status is held as per the Income Tax Act

Read Also - List of Indian & Overseas Address proof (for NRE/NRO also)

Required Documents to Open Saving Accounts:-

A) Status Proof

In case you are a Non-Resident Indian (NRI account documents)	If you’re a Person Of Indian Origin (PIO)
Photocopy of the relevant pages of your current passport where your name, address, date of birth, date & place of issue, expiry date, photograph & signature appear	Requirement: The Photocopy of the relevant pages of your current passport (in which your name, address, date of birth, date & place of issue, expiry date, photograph & signature is mentioned)
Also, the photocopy of Valid Visa / IKAMA (only for GCC) / Overseas Citizen of India card Others: The permanent Residency Card issued by USA and Singapore can be accepted in lieu of Visa	Photocopy of the PIO Card (If available) OR One has to fill in the self-declaration for PIO on the form

B) Overseas Address Proof (Anyone)

The documents mentioned below are accepted as an overseas address proof (anyone):

·         Valid Overseas Passport

·         Valid Driving License

·         Any relevant utility bill - Electricity / Telephone / Mobile (original bill) / Piped Gas / Broadband / Water Bill (not more than 3 months old)

·         Credit Card Bill along with photocopy of credit card (not more than 3 months old)

·         1-month bank account statement on bank's stationery (it should not be more than 4 months old) along with at least 1 customer-initiated transaction

·         Depository Participant (DP) account statement on bank's stationery (not more than 3 months old) with at least 1 customer-initiated transaction of at least 1 month

·         Banker's verification on bank's stationery

·         Not more than one-year old: Wealth/ Income/ Sales/ Service Tax Assessment Order

C) Identity Proof (Anyone)

The documents mentioned below are accepted as Identity proof (Anyone):

·         Valid Passport

·         PIO Card i.e. applicable only in case of PIOs

·         Valid Driving License

·         Voter’s ID card

·         Photocopy of Bank statement or passbook of an NRI account with another Scheduled Commercial Bank in India not more than four months old with at least one customer-initiated transaction. (Only if it contains Photograph)

·         Overseas Citizen of India card

·         There should be a valid Photo ID Cards issued by any of the following Organizations/Institutions:

·         Central / State Government Ministries and Departments

·         Statutory / Regulatory authorities (e.g. Insurance Regulatory and Development Authority, National Highway Authority of India, Securities Exchange Board of India, Airports Authority of India, Directorate General Civil Aviation, All India Council of Technical Education, Reserve Bank of India, Indian Banks’ Association, Telecom Regulatory Authority of India, Central and State Electricity Regulatory Commissions, Bar Councils, Institute of Chartered Accountants of India etc.)

·         PSUs established under Central / State Govt.

·         Pension Book /Card / Freedom Fighter’s Pass

·         Senior Citizens Card

·         Ministry / Department of Defense for personnel & their dependents

·         Public Financial Institutions

II) Here are the additional documents required if you have not met any Bank official yet

·         You will need to get photocopies of supporting documents duly attested by Indian Embassy or (High Commission or Bankers verification).

or

·         Self-certify the copies of documents and furnish anyone self-signed additional identity proof

III) Mandate-Holder Documentation

If there is a need to add a Mandate Holder needs to the account then please submit an Identity proof, Address proof and Signature proof (Not required if the current passport has a signature) of the Mandate Holder. The Mandate Holder will need to self-attest the photocopies of all his / her documents submitted as proof of the documents.

If you’re sending the form directly from abroad, you will need to send the Mandate Letter to your appointed Mandate Holder who resides in India.

The appointed Mandate Holder would require submitting the completed form, along with the documents, in person at any of the YES BANK branches in India. The mandate holder will have to carry his / her documents in original for verification purposes.

IV) Seafarers Account

A.    Going on a new fresh contract:

·         You’ll need a photocopy of Passport with Visa (first four pages of the passport as well as the page indicating last date of arrival in India OR Copy of Passport and separate proof of NRI status (in case the Visa / Permit is not included in the passport)

·         Valid Contract Copy

·         Continuous Discharge Certificate (CDC) booklet copy with your name, other details & the latest discharge stamping (optional if contract valid)

·         Mailing address proof required. Overseas address proof not mandatory.

B.    NRI Savings account documents required:
List of additional documents to be provided in case of a Permanent Employee

·         Initial work contract &

·         Last wage slip (within last 6 months)

If you are a Contract Employee, then you also need to provide the last work contract valid as on date.

C.   In case you have just back from a contract & are on a break:

·         In case your last contract letter is no longer valid/ expired within last the 9 months similar would be accepted without need of new contract letter confirmation from local agent (a local agent is an individual /entity which coordinates and helps placement of seafarers in shipping companies), provided CDC is valid (as on date of account opening), as CDC is a sufficient proof of NRI status.

·         If the person doesn’t have a CDC but holds a valid VISA, then last contract letter will be accepted as above, if the passport shows immigration seal within the last 6 months.

·         In case of expiration of the contract letter prior to 9 months, a letter from a local agent that will confirm the next date of joining vessel or current work contract letter will be required.

·         Any declaration by Seafarers (Provided in the Account Opening Form)

D.   Additional Information:

·         There is no need for a CDC copy for crew members employed with cruise liners.

·         As this is a seafarer account the permanent address proof would be mandatory.

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