Unaudited Financial Results for the Quarter / Nine Months Ended 31st December 2020
|Particulars||Quarter ended||Nine months ended||Year ended|
|1. Interest earned (a+b+c+d)||135031||139470||150378||412111||453382||598998|
|a) Interest / discount on advances / bills||110465||114030||115236||335706||352110||466505|
|b) Income on Investments||23455||24619||29181||72209||87415||114967|
|c) Interest on balances with Reserve Bank of India & other interbank funds||843||653||3732||3584||11141||14076|
|d) Other Interest||268||168||2229||612||2716||3450|
|2. Other income (Refer note 4 below)||25149||27156||26006||84018||80763||115462|
|3. Total Income (1+2)||160180||166626||176384||496129||534145||714460|
|4. Interest Expended||76673||79321||92657||237420||277636||364204|
|5. Operating Expenses (i+ii)||57816||42429||45254||140754||130407||174171|
|(i) Employees cost||36828||22055||22549||80247||64223||85665|
|(ii) Other operating expenses||20988||20374||22705||60507||66184||88506|
|6. Total Expenditure (excluding provisions and contingencies) (4+5)||134489||121750||137911||378174||408043||538375|
|7. Operating Profit before Provisions and Contingencies (3-6)||25691||44876||38473||117955||126102||176085|
|8. Provisions (other than tax) and Contingencies||20121||28473||36426||82351||105940||148867|
|9. Exceptional items||-||-||-||-||-||-|
|10. Profit from ordinary activity before tax (7-8-9)||5570||16403||2047||35604||20162||27218|
|11. Tax expense||2107||4914||540||10102||5030||3716|
|12. Net Profit from ordinary activities after tax(10-11)||3463||11489||1507||25502||15132||23502|
|13. Extraordinary items (net of tax expense)||-||-||-||-||-||-|
|14. Net Profit for the period (12-13)||3463||11489||1507||25502||15132||23502|
|15. Paid-up equity share capital (FV Rs.2/- per share)||15986||15986||15986||15986||15986||15986|
|16. Reserves excluding Revaluation Reserve||644041|
|17. Analytical Ratios|
|(i) % of shares held by Government of India||-||-||-||-||-||-|
|(ii) Capital Adequacy Ratio-Basel III (%)||18.52||18.41||15.87||18.52||15.87||17.17|
|(iii) Earnings per share (EPS) (*) (Rs..)|
|a) Basic EPS before and after extraordinary items||0.43||1.44||0.19||3.19||1.89||2.94|
|b) Diluted EPS before and after extraordinary items||0.43||1.44||0.19||3.19||1.89||2.94|
|(iv) NPA Ratios|
|a) Gross NPA||384247||399843||442397||384247||442397||421277|
|b) Net NPA||126311||142820||194568||126311||194568||180865|
|c) % of Gross NPA||7.37||7.93||8.92||7.37||8.92||8.68|
|d) % of Net NPA||2.55||2.99||4.13||2.55||4.13||3.92|
|(v) Return on Asset (annualized) (%)||0.19||0.63||0.08||0.47||0.27||0.32|
|* EPS not annualised for the quarter/nine months.|
|SEGMENT REPORTING FOR THE QUARTER/NINE MONTHS ENDED 31st DECEMBER 2020|
|Business Segments||Quarter ended||Nine months ended||Year ended|
|2. Corporate / Wholesale Banking||31168||30970||37270||93564||113443||150547|
|3. Retail Banking||97654||96847||100010||287481||296837||393881|
|4. Other Banking Operations||744||711||820||1826||2152||3136|
|2. Corporate / Wholesale Banking||4821||8254||9437||21066||28907||39259|
|3. Retail Banking||17215||27183||25785||69183||76402||102577|
|4. Other Banking Operations||516||555||717||1362||1893||2760|
|Less: Unallocated expenses (net)||5422||5460||6938||16376||19858||26336|
|Net Profit from ordinary activities||3463||11489||1507||25502||15132||23502|
|2. Corporate / Wholesale Banking||1203033||1149529||1245554||1203033||1245554||1213077|
|3. Retail Banking||3748212||3632652||3466386||3748212||3466386||3396734|
|4. Other Banking Operations||-||-||-||-||-||-|
|Total Segment Assets||7259765||7117472||7265483||7259765||7265483||6827817|
|2. Corporate / Wholesale Banking||1086600||1033496||1111004||1086600||1111004||1087141|
|3. Retail Banking||3385706||3266230||3092531||3385706||3092531||3043627|
|4. Other Banking Operations||-||-||-||-||-||-|
|Capital employed (Segment assets - Segment liabilities)|
|2. Corporate / Wholesale Banking||116433||116033||134550||116433||134550||125936|
|3. Retail Banking||362506||366422||373855||362506||373855||353107|
|4. Other Banking Operations||-||-||-||-||-||-|
|Total Segment Liabilities (a+b)||7259765||7117472||7265483||7259765||7265483||6827817|
|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.|
1) The above financial results for the quarter/nine months ended 31st December 2020 have been reviewed by the Audit Committee of the Board and approved by the Board of Directors at the meeting held on 11th February 2021. The same have been subjected to limited review by the Statutory Central Auditors of the Bank in line with the guidelines issued by the Reserve Bank of India (RBI) and as per the listing agreement with the stock exchange.
2) There has been no change in the accounting policies followed in the preparation of these financial results for the quarter/nine months ended 31st December 2020 as compared to those followed in the financial statements for the year ended 31st March 2020.
3) The Bank has made provisions in accordance with RBI guidelines, for loan losses and depreciation on investments, standard advances, restructured advances, exposures to entities with unhedged foreign currency exposure. Provision for employees’ retirement benefits viz. pension, gratuity and leave encashment has been made based on actuarial valuation. Provision for Income Tax, Deferred Tax and other contingencies are made on an estimated and proportionate basis and are subject to adjustments, if any, at the year end.
4) 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 from advances written off, profit on bullion business etc.
5) In accordance with RBI circular DBOD.No.BP.BC.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, the 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/disclosures-pillar-III/. These disclosures have not been subjected to review / audit by the Statutory Central Auditors.
6) COVID-19 pandemic continues to have a significant impact and volatility in the global and domestic economies and consequently the extent to which the same will impact the Bank’s operations and financial position remain uncertain and is dependent on several factors including, inter-alia, measures initiated by the Government of India and RBI to mitigate the effects of the pandemic. There is improvement in economic activity consequent to the relaxations of restrictions by Government. The Bank’s management continues to closely monitor the day-to-day operations, business and liquidity position as well as adequacy of capital.
RBI vide circular DOR.No.BP.BC.72/21.04.048/2019-20 dated 23rd May 2020 read with circulars DOR.No.BP.BC.63/21.04.048/2019-20 dated 17th April 2020 and DOR.No.BP.BC.47/21.04.048/2019-20 dated 27th March 2020 announced ‘COVID-19 Regulatory Package’ which envisaged grant of various relief measures to borrowers whose accounts were classified as Standard Assets as on 29th February 2020. Accordingly, Board approved a policy for implementation of the said package including, inter-alia, grant of moratorium on the payment of installments and/or deferment of interest falling due between 1st March 2020 and 31st August 2020 as well as relaxation of certain other parameters, to eligible borrowers.
As on 30th September 2020, Bank was maintaining provision against the likely impact of COVID-19 amounting to Rs. 21529 lakh. Out of this, during the current quarter, the bank has utilized Rs. 1404 lakh for creation of RBI mandated provision for advances restructured under “Resolution framework for COVID-19 related stress” and Rs. 6456 lakh for provision in respect of accounts which have not been classified as NPA pursuant to interim order of Honourable Supreme Court.
The Honourable Supreme Court of India in a writ petition in the matter of Gajendra Sharma Vs. Union of India & Anr. vide its interim order dated 3rd September 2020, has directed Banks that the accounts which were not declared NPA till 31st August 2020 shall not be classified as NPA till further orders. Pursuant to the order, the Bank has not classified any account that was not classified as NPA as on 31st August 2020 as per the prudential IRAC norms of RBI, as NPA after 31st August 2020. During the current quarter, the Bank has made additional provision of Rs. 6525 lakh (Rs. 472 lakh for the quarter ended 30th September 2020) for certain accounts which otherwise would have become NPA had there been no Supreme Court order directing banks not to classify any account as NPA and Rs. 5732 lakh has been provided for certain accounts for which resolution framework have been invoked.
However, if the Bank had classified borrower accounts as NPA after 31st August 2020, the Bank’s pro forma Gross NPA ratio and pro forma Net NPA ratio would have been 9.07% and 4.08% respectively as at 31st December 2020. The Bank has also not recognized the unrealized interest on these accounts and not considered these accounts as NPA for computation of capital adequacy ratio as at 31st December 2020.
The aggregate of the above provisions including provision for likely impact of COVID-19 and RBI mandated provision as on 31st December 2020 is Rs. 34258 lakh and provisions held by the Bank against the potential impact of COVID-19 are in excess of the RBI prescribed norms.
7) Hitherto, the Bank was making payment for proposed wage revision based on certain estimates. Pursuant to the 11th Bipartite Settlement and Joint Note dated 11th November 2020 entered into between Indian Banks’ Association and Workmen Unions and Officers’ Associations respectively, Bank has assessed the impact of wage revision and has created an additional provision of Rs. 17464 lakh during the quarter ended 31st December 2020 and Rs. 2355 lakh for the half year ended 30th September 2020.
8) Provision Coverage Ratio as on 31st December 2020, calculated as per the guidelines of RBI is 77.35% (previous period 65.43%).
9) Previous period’s/year’s figures have been re-classified/regrouped wherever considered necessary to confirm to the current period’s/year’s classification.
For and on behalf of Board of Directors
B. Ramesh Babu
Managing Director & CEO
Date: 11th February 2021