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Analyst Meet / AGM - Analyst Meet

Expect loan growth of 12% for FY2017

State Bank of Bikaner & Jaipur

30-Apr-2016, 06:53
State Bank of Bikaner & Jaipur conducted and analyst meet on 29 April 2016 to discuss its financial results for the quarter and year ended March 2016. Jyoti Ghosh, MD of the bank addressed the meet.

Highlights:

* Bank has recorded 10% growth in the net profit to Rs 851 crore in FY2016 over FY2015. Bank has recorded 10 bps improvement in its net interest margin to 3. 47% in FY2016 from 3.37% in FY2015.

* Income derecognition on account of fresh slippages of advances stood at Rs 100 crore in FY16.

* Bank has recorded healthy 14% growth in its non-interest income to Rs 1057 crore. The core fee income of the bank has surged 22% to Rs 756 crore in FY2016.

* Deposits of the bank increased 12% to Rs 94005 crore at end March 2016 over March 2015. The Casa deposit ratio of the bank was steady at 38.7% at end March 2016 compared with 38.85% at end March 2015.

* Bank has recorded 5% growth in advances book to Rs 7474 3 crore at end March 2016 over March 2015. Loan growth was driven by retail sector recording strong 17% growth in loan book to Rs 14247 crore agricultural sector 14% to Rs 13637 crore, SME segment 22% to Rs 13178 crore. However, the corporate segment has recorded 7% decline in loan book to Rs 33681 crore at end March 2016 over March 2015

* The share of corporate loan book of the bank has declined to 45% at end March 2016 from 51% at end March 2015.

* Bank is targeting 17% loan growth for FY2017. As per the bank, about 70% of its loan growth will be driven by retail sector, 15% by corporate sector and balance from other segments.

* The fresh slippages of advances was higher at Rs 1066 crore in Q4FY2016 rising from Rs 818 crore in the previous quarter and Rs 638 crore in the corresponding quarter last year. Bank has recorded recoveries and upgradations of Rs 153 crore, while write-offs stood at Rs 250 crore in Q4FY2016. Bank has also conducted assets sale of Rs 134 crore to asset reconstruction companies in Q4FY2016.

* On account of surge in fresh slippages of advances, the GNPA ratio of the bank increased to 4.82% at end March 2016 from 4.22% a quarter ago and 4.1% a year ago.

* Sector wise GNPA ratio was higher at 5.9% for agriculture sector, followed by 5.8% for corporate sector and 5% for SME agreement. However, the GNPA ratio was lower at 1.2% for retail Segment.

* As regard to Asset Quality Review (AQR) 1 and 2, bank has fully complied with the RBI recommendations in FY2016. As regard to AQR 3, bank is having 22 account with the exposure of Rs 2195 crore. However, bank has moved up a step ahead and already made provision at the rate of 11% against the regulatory requirements of 5%. Of these accounts, about three accounts with the exposure of Rs 300 crore has already sleeped to NPA category.

* Bank has conducted strategic debt restructuring for 5 accounts with the exposure of Rs 1000 crore in FY2016. Bank has conducted 5/25 refinancing for 7 accounts with the exposure of Rs 500-600 crore in FY2016.

* As per the bank the size of its SMA2 portfolio stood at Rs 1800 crore or 2% of loan book at end March 2016 from Rs 2800 crore at end December 2015. Thus, bank search Bank do not expect any impact from any further AQR from the Reserve Bank of India.

* The restructured advance book of the banks stood at Rs 5066 crore at and March 2016.

* In expectations of interest rate cut from the Reserve Bank of India in April 2016 policy, the bank decided to delay booking of treasury gains from March 2016 to April 2015. Bank has recorded treasury gains of Rs 40 crore in April 2016 which will accrue in the financial result of Q1FY2017.

* As per the bank share of alternate delivery channels in total transactions stood at 54% and March 2016.