Audited Financial Results for the Quarter and Year ended 31st March 2022

(Rs. In Lakh)
Particulars Quarter ended Year ended
31-03-2022 31-12-2021 31-03-2021 31-03-2022 31-03-2021
Audited Unaudited Audited Audited
1. Interest earned (a+b+c+d) 140927 140451 134931 558767 547043
a) Interest / discount on advances / bills 113813 113313 109648 452548 445355
b) Income on Investments 24138 23478 21970 92478 94179
c) Interest on balances with Reserve Bank of India & other interbank funds 2885 3571 3245 13433 6829
d) Other Interest 91 89 68 308 680
2. Other Income 20548 19561 16908 76906 91882
3. Total Income (1+2) 161475 160012 151839 635673 638925
4. Interest Expended 69934 71728 73671 287230 311091
5. Operating Expenses (i+ii) 47410 48125 57929 185422 198683
(i) Employees cost 22317 24336 35121 94503 115368
(ii) Other operating expenses 25093 23789 22808 90919 83315
6. Total Expenditure (excluding provisions and contingencies) (4+5) 117344 119853 131600 472652 509774
7. Operating Profit before Provisions and Contingencies (3-6) 44131 40159 20239 163021 129151
8. Provisions (other than tax) and Contingencies 14012 14610 2406 69929 75714
9. Exceptional items - - - - -
10. Profit from ordinary activity before tax (7-8-9) 30119 25549 17833 93092 53437
11. Tax expense 8772 7001 7396 25765 17498
12. Net Profit from ordinary activities after tax(10-11) 21347 18548 10437 67327 35939
13. Extraordinary items (net of tax expense) - - - - -
14. Net Profit for the period (12-13) 21347 18548 10437 67327 35939
15. Paid-up equity share capital (FV Rs.2/- per share) 16000 15987 15986 16000 15986
16. Reserves excluding Revaluation Reserve 743620 679988
17. Analytical Ratios
(i) % of shares held by Government of India - - - - -
(ii) Capital Adequacy Ratio-Basel III (%) 19.46 18.79 18.98 19.46 18.98
(iii) Earnings per share (EPS)1 (Rs..)
a) Basic EPS before and after extraordinary items 2.67 2.32 1.31 8.42 4.50
b) Diluted EPS before and after extraordinary items 2.67 2.32 1.31 8.41 4.50
(iv) NPA Ratios
a) Gross NPA 343104 388752 414287 343104 414287
b) Net NPA 126079 135557 171939 126079 171939
c) % of Gross NPA 5.96 6.97 7.85 5.96 7.85
d) % of Net NPA 2.28 2.55 3.41 2.28 3.41
(v) Return on Asset (annualized) (%) 1.06 0.93 0.55 0.86 0.49
18. Net worth2 741781 733292 684039 741781 684039
19. Paid up debt capital/ Outstanding debt3 (%) 36.37 37.57 19.26 36.37 19.26
20. Debt/equity ratio4 0.09 0.11 0.11 0.09 0.11
21. Total debts to total assets5 (%) 1.67 1.67 3.39 1.67 3.39

1 - EPS not annualised for the quarter.

2 - Net worth is calculated as per guidelines given under RBI Master Circular on Exposure Norms.

3 - Outstanding debt / Total debts represent total borrowings of the Bank. Debt represents borrowings with residual maturity of more than one year.

4 - Equity represents total of share capital and reserves less proposed dividend.

5 - Total assets as per Balance Sheet.

(Rs. In Lakh)
STATEMENT OF ASSETS AND LIABILITIES
Particulars As on 31.03.2022
(Audited)
As on 31.03.2021
(Audited)
Capital and Liabilities
Capital 16000 15986
Reserve and Surplus 743620 679988
Deposits 6867616 6327843
Borrowings 133909 252829
Other Liabilities and Provision 243227 185673
Total 8004372 7462319
Assets
Cash & Balances with RBI 359426 351406
Balances with Banks and Money at Call and Short Notice 133191 280628
Investments 1721606 1601893
Advances 5533462 5036350
Fixed Assets 47849 53906
Other Assets 208838 138136
Total 8004372 7462319
(Rs. In Lakh)
Segment Reporting for the Quarter and Year ended 31st March 2022
Business Segments Quarter ended Year ended
31-03-2022 31-12-2021 31-03-2021 31-03-2022 31-03-2021
Audited Unaudited Audited Audited
Segment Revenue
1. Treasury 24666 24404 21701 101825 125915
2. Corporate / Wholesale Banking 34829 33769 31647 135997 125211
3. Retail Banking 100799 100888 97537 394225 385018
4. Other Banking Operations 1181 951 954 3626 2781
Total 161475 160012 151839 635673 638925
Segment Results
1. Treasury 5595 4224 1294 21787 35538
2. Corporate / Wholesale Banking 10904 9856 5528 39887 26455
3. Retail Banking 32600 31145 18111 121875 86877
4. Other Banking Operations 865 691 647 2660 1997
Total 49964 45916 25580 186209 150867
Less: Unallocated Income/Expenses 5833 5757 5341 23188 21716
Operating Profit 44131 40159 20239 163021 129151
Tax expense 8772 7001 7396 25765 17498
Other Provisions 14012 14610 2406 69929 75714
Net Profit from ordinary activities 21347 18548 10437 67327 35939
Extraordinary items - - - - -
Net Profit 21347 18548 10437 67327 35939
Segment Assets
1. Treasury 1848842 1905877 1912596 1848842 1912596
2. Corporate / Wholesale Banking 1385684 1324378 1177076 1385684 1177076
3. Retail Banking 4147778 3998291 3859275 4147778 3859275
4. Other Banking Operations - - - - -
5. Unallocated 622068 532635 513372 622068 513372
Total Segment Assets 8004372 7761181 7462319 8004372 7462319
Segment Liabilities
1. Treasury 1738133 1761533 1836846 1738133 1836846
2. Corporate / Wholesale Banking 1239526 1189875 1045290 1239526 1045290
3. Retail Banking 3710702 3593340 3428179 3710702 3428179
4. Other Banking Operations - - - - -
5. Unallocated 556391 478461 456030 556391 456030
Total (a) 7244752 7023209 6766345 7244752 6766345
Capital Employed (Segment Assets - Segment Liabilities)
1. Treasury 110709 144344 75750 110709 75750
2. Corporate / Wholesale Banking 146158 134503 131786 146158 131786
3. Retail Banking 437076 404951 431096 437076 431096
4. Other Banking Operations - - - - -
5. Unallocated 65677 54174 57342 65677 57342
Total (b) 759620 737972 695974 759620 695974
Total Segment Liabilities (a+b) 8004372 7761181 7462319 8004372 7462319
For the above segment reporting, the reportable segments are identified into Treasury, Corporate/Wholesale banking, Retail banking and other banking operations in compliance with RBI guidelines. The Bank operates only in India.
(Rs. In Lakh)
CASH FLOW STATEMENT
Particulars As on 31.03.2022
(Audited)
As on 31.03.2021
(Audited)
Cash flow from operating activities
Net Profit as per Profit and Loss account 67327 35939
Adjustments for
Depreciation on Bank’s property 11918 12414
Interest paid on TIER II bonds 5820 5819
Provisions for other contingencies 5334 9804
Provision for taxes 25765 17498
Provision for depreciation on investment 10714 13782
Provision for standard assets 1699 573
Provision for bad and doubtful debts 63485 63399
Provision for non performing investments (589) 1938
Provision for compensation absences 208 5501
Amortization of premium paid on Held to Maturity (HTM) investments 13574 12273
Provision for employees stock option plan / scheme 49 8
(Profit) / Loss on sale of fixed assets (net) (110) (22)
Operating profit before working capital changes 205193 178926
Adjustments for working capital changes
(Increase) / Decrease in investments (excluding HTM investments) 10213 76611
(Increase) / Decrease in advances (560432) (490609)
(Increase) / Decrease in other assets (130225) 5707
Increase / (Decrease) in deposits 539773 420336
Increase / (Decrease) in borrowings (118920) 134411
Increase / (Decrease) in other liabilities and provisions 52447 25171
(1951) 350553
Direct taxes paid 31500 (14000)
Net cash flow from / (used in) operating activities 29549 336553
Cash flow from investing activities
Purchase of fixed assets (5861) (7656)
(Increase)/Decrease in HTM investments (153626) (130251)
Sale of fixed assets / other assets 110 22
Net cash flow from / (used in) investing activities (159376) (137885)
Cash flow from financing activities
Proceeds from issue of share capital 14 -
Proceeds from share premium 253 -
Increase/(Decrease) in tier II bonds - -
Interest paid on tier II bonds (5820) (5820)
Dividend paid (including tax on dividend) (4037) (69)
Net cash flow from /(used in) financing activities (9590) (5889)
Net Increase in cash & cash equivalents (139417) 192779
Cash and cash equivalents at the beginning of the year 632034 439255
Cash and cash equivalents at the end of the year 492617 632034

Notes:

1) The figures for the quarter ended 31st March 2022 and 31st March 2021 are the balancing figures between audited figures in respect of the full financial year and the published year to date figures upto the end of the third quarter of the respective financial year.

2) The above financial results for the quarter / year ended 31st March 2022 have been recommended by the Audit Committee of the Board and approved by the Board of Directors at the meeting held on 20th May 2022. The same has been subjected to audit as per listing agreement with the stock exchange by the Joint Statutory Central Auditors of the Bank and an unmodified audit report has been issued. The financial results for the quarter and year ended 31st March 2021 were audited by the erstwhile statutory auditor, on which they had issued an unmodified opinion.

3) There has been no change in the accounting policies followed in the preparation of the financial results for the quarter / year ended 31st March 2022, as compared to those followed for the year ended 31st March 2021, except that related to Employee Stock Option Scheme, the details of which are given in item 4 below.

4) RBI issued a clarification on 30th August 2021, regarding Compensation of Whole Time Directors/Chief Executive Officers/Material Risk Takers and Control Function Staff, advising Banks that the compensation through share linked instruments are required to be fair valued on the date of grant using the Black-Scholes model and the fair value thus arrived should be recognised as an item of expenditure for all options granted after the accounting period ended 31st March 2021. Accordingly, the Bank has changed its accounting policy from the earlier intrinsic value method to the fair value method using Black-Scholes model for share linked instruments granted after 31” March 2021 and consequently recognized the value of the options granted as an item of employee cost over the vesting period. However, there is no material impact due to change in the valuation method.

5) The financial results are prepared after considering provisions for NPA, non-performing investments, standard advances, restructured advances, exposures to entities with unhedged foreign currency exposure, taxes on income including deferred tax and other usual and necessary provisions. Provision for employees’ benefits (including retirement benefits) viz. pension, gratuity and compensated absences has been made based on actuarial valuation.

6) Other income includes fees earned from providing services to customers, commission from non-fund based banking activities, earnings from foreign exchange transactions, selling third party products, profit on sale of investments (net), recoveries in written off accounts, premium on sale of priority sector lending certificates, profit on bullion business etc.

7) During the quarter and year ended 31st March 2022, the Bank has allotted 6,53,236 and 6,89,964 equity shares respectively, of face value Rs. 2/- each, pursuant to the exercise of stock options by employees.

8) The revision in family pension payable to employees of the Bank covered under 11th Bipartite Settlement and Joint Note dated 11th November 2020 was quantified on 26th August 2021; the Bank opted to amortize the additional liability of Rs. 8026 lakh based on actuarial valuation during the three quarters of financial year 2021-22 equally, and has been accordingly expensed to Profit & Loss account i.e. Rs. 2676 lakh during the quarter ended 30th September 2021, Rs. 2675 lakh during the quarter ended 31st December 2021 and Rs. 2675 lakh during the quarter ended 31st March 2022.

9) The outbreak of the COVID-19 pandemic had led to a nation-wide lockdown in April-May 2020. This was followed by localised lockdowns in areas with a significant number of COVID-19 cases. Following the decline in the spread of the pandemic, the lockdown measures were eased and there is a gradual improvement in economic activity. The extent to which the current pandemic and its future waves, if any, including other related developments would impact the Bank’s and the asset quality are uncertain. The Management continues to closely monitor the day to day operations, liquidity position and adequacy of capital and continues to maintain liquidity coverage and capital adequacy ratios at higher levels than the regulatory minimum as on 31st March 2022.

10) Details of resolution plan implemented under the Resolution Framework for COVID-19 related stress as per RBI Circular DOR.No.BP.BC/3/21.04.048/2020-21 dated 6th August 2020 (Resolution Framework 1.0) and as per RBI circular DOR.STR.REC.11/21.04.048/2021-22 dated 5th May 2021 (Resolution Framework 2.0) “Covid-19 Related Stress of Individuals and Small businesses” are given below:

(Rs. In Lakh)
Type of borrower Exposure to accounts classified as Standard consequent to implementation of resolution plan – Position as at 30.09.20211 Of (A), aggregate debt that slipped into NPA during the half-year Of (A), amount written off during the half-year Of (A), amount paid by the borrowers during the half-year2 Exposure to accounts classified as Standard consequent to implementation of resolution plan – Position as at 31.03.2022
A B C D E
Personal Loans 68968 4392 0 2940 61635
Corporate persons* 30109 0 0 933 29176
Of which MSMEs 0 0 0 0 0
Others 5915 0 0 565 5350
Total 104992 4392 0 4438 96161
* As defined in Section 3(7) of the Insolvency and Bankruptcy Code, 2016
1Includes exposure as on 30th September 2021 of accounts that are restructured after 30th September 2021
2Represents Net Movement in Balances

11) Disclosure in respect of borrower accounts where modifications were sanctioned and implemented under Resolution Framework 2.0 for COVID-19 related stress:

(Rs. In Lakh)
No. of accounts in respect of which modification were sanctioned and implemented (A) 295
Aggregate exposure to such borrower accounts as on 31st March 2022 8498
Exposure to accounts mentioned at (A) before implementation of the Resolution Plan 8674

12) Details of loans not in default / stressed loans transferred / acquired as per RBI Circular DOR.STR.REC.51/21.04.048/2021-22 dated 24th September 2021 are given below:

a. Loans classified as NPAs transferred

(Rs. In Lakh)
Particulars Quarter ended 31st March 2022 Transferred to Year ended 31st March 2022 Transferred to
ARCs Permitted transferees Others ARCs Permitted transferees Others
No. of accounts 71 - - 73 - -
Aggregate principal outstanding of loans transferred 7151 - - 15095 - -
Weighted average residual tenor of the loans transferred 0 - - 0 - -
Net book value of loans transferred (at the time of transfer) 0 - - 0 - -
Aggregate consideration 3541 - - 10586 - -
Additional consideration realized in respect of accounts transferred in earlier years 0 - - 0 - -
Excess provision reversed to the P&L a/c. on account of sale of NPA 3541 - - 10586 - -

b. Loans not in default acquired through assignment

(Rs. In Lakh)
Particulars Quarter ended 31st March 2022 Acquired from Year ended 31st March 2022 Acquired from
SCBs, RRBs, UCBs, StCBs, DCCBs, AIFIs, SFBs and NBFCs (incl. HFCs) ARCs SCBs, RRBs, UCBs, StCBs, DCCBs, AIFIs, SFBs and NBFCs (incl. HFCs) ARCs
Aggregate principal outstanding of loans acquired 5334 - 25314 -
Aggregate consideration paid 4800 - 24780 -
Weighted average residual tenor of loans acquired Ranging between 38 to 91 months - Ranging between 16 to 91 months
Coverage of tangible security Ranging between 155% to 270% - Ranging between 100% to 270%
Retention of beneficial economic interest by the transferor 10% - 10%
Rating wise distribution of loans acquired Not Applicable* - Not Applicable* -
* - loans acquired are under non-corporate category

c. The Bank has neither transferred any stressed (SMA) loans & loans not in default nor has acquired any stressed loans / loans classified as NPA acquired during the quarter / year ended 31st March 2022.

13) Provision Coverage Ratio as on 31st March 2022, calculated as per RBI guidelines is 80.27% (corresponding previous year ratio is 72.70%).

14) The ratios and other information which is to be disclosed as per Regulation 52(4) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, have been disclosed to the extent considered applicable.

15) Based on RBI Master Direction on Financial Statements – Presentation and Disclosures dated 30th August 2021 (updated by RBI on 15th November 2021), depreciation on investments which were hitherto classified under provisions and contingencies have now been reported under ‘Other Income’. The figures for the current and earlier periods are accordingly presented as per the updated directions.

16) The Board of Directors have recommended a dividend of 80% i.e. Rs. 1.60 per equity share of Rs. 2.00 each for the year 2021-22, subject to the approval of the shareholders at the ensuing Annual General Meeting. In accordance with Accounting Standards 4 - Contingencies and Events Occurring after the Balance Sheet date, the proposed dividend has not been shown as an appropriation from the Profit and Loss account for the year ended 31st March 2022 and correspondingly not reported under Other Liabilities and Provisions as at 31st March 2022. However, capital adequacy ratio has been computed by reducing the proposed dividend.

17) In accordance with RBI circular DBOD.No.BPBC.1/21.06.201/2015-16 dated 1st July 2015, read together with RBI circular DBR.No.BP.BC.80/21.06.201/2014-15 dated 31st March 2015, Banks are required to make Pillar 3 disclosures under Basel III capital regulations. Accordingly, Pillar 3 disclosures under Basel III capital regulations have been made available on the Bank’s website at the following link https://www.kvb.co.in/about-us/disclosures/, including disclosures in respect of Net Stable Funding Ratio (NSFR) as per RBI circular DOR.No.LRG.BC.40/21.04.098/2020-21 dated 5th February 2021 read together with circular DBR.BP.BC.No.106/21.04.098/2017-18 dated 17th May 2018. These disclosures have not been subjected to audit/review by the Statutory Central Auditors.

18) Figures for the previous period/s have been re-grouped and re-classified, where necessary, to make them comparable with current period figures.

Place: Karur
Date: 20.05.2022
For and on behalf of Board of Directors
B Ramesh Babu
Managing Director & CEO
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