Unaudited Financial Results for the Quarter / Half Year Ended 30th September 2020
| Particulars | Quarter ended | Half Year ended | Year ended | |||
|---|---|---|---|---|---|---|
| 30-09-2020 | 30-06-2020 | 30-09-2019 | 30-09-2020 | 30-09-2019 | 31-03-2020 | |
| Unaudited | Unaudited | Audited | ||||
| 1. Interest earned (a+b+c+d) | 139470 | 137610 | 153751 | 277080 | 303004 | 598998 |
| a) Interest / discount on advances / bills | 114030 | 111211 | 119324 | 225241 | 236874 | 466505 |
| b) Income on Investments | 24619 | 24135 | 30021 | 48754 | 58234 | 114967 |
| c) Interest on balances with Reserve Bank of India & other interbank funds | 653 | 2088 | 4163 | 2741 | 7409 | 14076 |
| d) Other Interest | 168 | 176 | 243 | 344 | 487 | 3450 |
| 2. Other income (Refer note 4 below) | 27156 | 31713 | 27773 | 58869 | 54757 | 115462 |
| 3. Total Income (1+2) | 166626 | 169323 | 181524 | 335949 | 357761 | 714460 |
| 4. Interest Expended | 79321 | 81426 | 94123 | 160747 | 184979 | 364204 |
| 5. Operating Expenses (i+ii) | 42429 | 40509 | 44285 | 82938 | 85153 | 174171 |
| (i) Employees cost | 22055 | 21364 | 21299 | 43419 | 41674 | 85665 |
| (ii) Other operating expenses | 20374 | 19145 | 22986 | 39519 | 43479 | 88506 |
| 6. Total Expenditure (excluding provisions and contingencies) (4+5) | 121750 | 121935 | 138408 | 243685 | 270132 | 538375 |
| 7. Operating Profit before Provisions and Contingencies (3-6) | 44876 | 47388 | 43116 | 92264 | 87629 | 176085 |
| 8. Provisions (other than tax) and Contingencies | 28473 | 33757 | 36517 | 62230 | 69514 | 148867 |
| 9. Exceptional items | - | - | - | - | - | - |
| 10. Profit from ordinary activity before tax (7-8-9) | 16403 | 13631 | 6599 | 30034 | 18115 | 27218 |
| 11. Tax expense | 4914 | 3081 | 266 | 7995 | 4490 | 3716 |
| 12. Net Profit from ordinary activities after tax(10-11) | 11489 | 10550 | 6333 | 22039 | 13625 | 23502 |
| 13. Extraordinary items (net of tax expense) | - | - | - | - | - | - |
| 14. Net Profit for the period (12-13) | 11489 | 10550 | 6333 | 22039 | 13625 | 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 (%) | 18.41 | 18.14 | 15.99 | 18.41 | 15.99 | 17.17 |
| (iii) Earnings per share (EPS) (*) (Rs..) | ||||||
| a) Basic EPS before and after extraordinary items | 1.44 | 1.32 | 0.79 | 2.76 | 1.70 | 2.94 |
| b) Diluted EPS before and after extraordinary items | 1.44 | 1.32 | 0.79 | 2.76 | 1.70 | 2.94 |
| (iv) NPA Ratios | ||||||
| a) Gross NPA | 399843 | 405566 | 439103 | 399843 | 439103 | 421277 |
| b) Net NPA | 142820 | 158523 | 211835 | 142820 | 211835 | 180865 |
| c) % of Gross NPA | 7.93 | 8.34 | 8.89 | 7.93 | 8.89 | 8.68 |
| d) % of Net NPA | 2.99 | 3.44 | 4.50 | 2.99 | 4.50 | 3.92 |
| (v) Return on Asset (annualized) (%) | 0.63 | 0.59 | 0.34 | 0.61 | 0.37 | 0.32 |
| * EPS not annualised for the quarter/half year. | ||||||
| Segment Reporting for the Quarter / Half year ended 30th September 2020 | ||||||
|---|---|---|---|---|---|---|
| Business Segments | Quarter ended | Half Year ended | Year ended | |||
| 30-09-2020 | 30-06-2020 | 30-09-2019 | 30-09-2020 | 30-09-2019 | 31-03-2020 | |
| Unaudited | Unaudited | Audited | ||||
| Segment Revenue | ||||||
| 1. Treasury | 38098 | 44546 | 44326 | 82644 | 83429 | 166896 |
| 2. Corporate / Wholesale Banking | 30970 | 31426 | 37798 | 62396 | 76173 | 150547 |
| 3. Retail Banking | 96847 | 92980 | 98694 | 189827 | 196827 | 393881 |
| 4. Other Banking Operations | 711 | 371 | 706 | 1082 | 1332 | 3136 |
| Total | 166626 | 169323 | 181524 | 335949 | 357761 | 714460 |
| Segment Results | ||||||
| 1. Treasury | 14344 | 19815 | 15224 | 34159 | 29286 | 57825 |
| 2. Corporate / Wholesale Banking | 8254 | 7991 | 9176 | 16245 | 19470 | 39259 |
| 3. Retail Banking | 27183 | 24785 | 24673 | 51968 | 50617 | 102577 |
| 4. Other Banking Operations | 555 | 291 | 621 | 846 | 1176 | 2760 |
| Total | 50336 | 52882 | 49694 | 103218 | 100549 | 202421 |
| Less: Unallocated expenses (net) | 5460 | 5494 | 6578 | 10954 | 12920 | 26336 |
| Operating Profit | 44876 | 47388 | 43116 | 92264 | 87629 | 176085 |
| Tax expense | 4914 | 3081 | 266 | 7995 | 4490 | 3716 |
| Other Provisions | 28473 | 33757 | 36517 | 62230 | 69514 | 148867 |
| Net Profit from ordinary activities | 11489 | 10550 | 6333 | 22039 | 13625 | 23502 |
| Extraordinary items | - | - | - | - | - | - |
| Net Profit | 11489 | 10550 | 6333 | 22039 | 13625 | 23502 |
| Segment Assets | ||||||
| 1. Treasury | 1862604 | 1855302 | 2031770 | 1862604 | 2031770 | 1738669 |
| 2. Corporate / Wholesale Banking | 1149529 | 1136483 | 1266351 | 1149529 | 1266351 | 1213077 |
| 3. Retail Banking | 3632652 | 3476616 | 3443830 | 3632652 | 3443830 | 3396734 |
| 4. Other Banking Operations | - | - | - | - | - | - |
| 5. Unallocated | 472687 | 469631 | 599480 | 472687 | 599480 | 479337 |
| Total Segment Assets | 7117472 | 6938032 | 7341431 | 7117472 | 7341431 | 6827817 |
| Segment Liabilities | ||||||
| 1. Treasury | 1710762 | 1695202 | 2009300 | 1710762 | 2009300 | 1607550 |
| 2. Corporate / Wholesale Banking | 1033496 | 1022297 | 1116766 | 1033496 | 1116766 | 1087141 |
| 3. Retail Banking | 3266230 | 3127431 | 3036956 | 3266230 | 3036956 | 3043627 |
| 4. Other Banking Operations | - | - | - | - | - | - |
| 5. Unallocated | 424917 | 422525 | 528279 | 424917 | 528279 | 429472 |
| Total (a) | 6435405 | 6267455 | 6691301 | 6435405 | 6691301 | 6167790 |
| Capital Employed (Segment Assets - Segment Liabilities) | ||||||
| 1. Treasury | 151842 | 160100 | 22470 | 151842 | 22470 | 131119 |
| 2. Corporate / Wholesale Banking | 116033 | 114186 | 149585 | 116033 | 149585 | 125936 |
| 3. Retail Banking | 366422 | 349185 | 406874 | 366422 | 406874 | 353107 |
| 4. Other Banking Operations | - | - | - | - | - | - |
| 5. Unallocated | 47770 | 47106 | 71201 | 47770 | 71201 | 49865 |
| Total (b) | 682067 | 670577 | 650130 | 682067 | 650130 | 660027 |
| Total Segment Liabilities (a+b) | 7117472 | 6938032 | 7341431 | 7117472 | 7341431 | 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. | ||||||
| Statement of Assets and Liabilities as on 30th September 2020 | ||||||
|---|---|---|---|---|---|---|
| Particulars | As on | |||||
| 30-09-2020 | 30-09-2019 | 31-03-2020 | ||||
| Unaudited | Audited | |||||
| Capital and liabilities | ||||||
| Capital | 15986 | 15986 | 15986 | |||
| Reserves and surplus | 666081 | 634144 | 644041 | |||
| Deposits | 6112241 | 6221279 | 5907508 | |||
| Borrowings | 138269 | 305269 | 118418 | |||
| Other liabilities and provisions | 184895 | 164753 | 141864 | |||
| Total | 7117472 | 7341431 | 6827817 | |||
| Assets | ||||||
| Cash and balances with Reserve Bank of India | 257311 | 348656 | 273267 | |||
| Balances with banks and money at call and short notice | 22121 | 193441 | 165988 | |||
| Investments | 1843464 | 1839835 | 1576244 | |||
| Advances | 4782181 | 4710181 | 4609811 | |||
| Fixed assets | 55635 | 61276 | 58664 | |||
| Other assets | 156760 | 188042 | 143843 | |||
| Total | 7117472 | 7341431 | 6827817 | |||
| Cash Flow Statement for the Half year ended 30th September 2020 | ||||||
|---|---|---|---|---|---|---|
| Particulars | Half Year ended | Year ended | ||||
| 30-09-2020 | 30-09-2019 | 31-03-2020 | ||||
| Unaudited | Audited | |||||
| Cash flow from / (used in) operating activities | ||||||
| Net profit as per Profit and Loss account | 22039 | 13625 | 23502 | |||
| Adjustments for | ||||||
| Depreciation on Bank’s property | 6171 | 5509 | 11888 | |||
| Interest paid on TIER II bonds | 2918 | 3635 | 6537 | |||
| Provisions for other contingencies | 20046 | (424) | 5247 | |||
| Provision for taxes | 7995 | 4490 | 3716 | |||
| Provision for depreciation on investment | 10221 | 1115 | 4022 | |||
| Provision for standard assets | 755 | 910 | 370 | |||
| Provision for bad and doubtful debts | 32869 | 65264 | 135617 | |||
| Provision for non performing investments | (1662) | 2650 | 3610 | |||
| Provision for leave encashment | 789 | 1460 | 1011 | |||
| Amortization of premium paid on Held to Maturity (HTM) investments | 5828 | 2872 | 6708 | |||
| Provision for employees stock option plan / scheme | - | - | 20 | |||
| (Profit) / loss on sale of fixed assets (net) | - | 670 | 1246 | |||
| Operating profit before working capital changes | 107969 | 101776 | 203494 | |||
| Adjustments for working capital changes | ||||||
| (Increase) / Decrease in investments (excluding HTM investments) | (167214) | (217425) | 37537 | |||
| (Increase) / Decrease in advances | (205215) | 82230 | 112224 | |||
| (Increase) / Decrease in other assets | (15564) | (24659) | 18294 | |||
| Increase / (Decrease) in deposits | 204733 | 234484 | (79287) | |||
| Increase / (Decrease) in borrowings | 19852 | 148735 | (23116) | |||
| Increase / (Decrease) in other liabilities and provisions | 23751 | 16091 | (6651) | |||
| (31688) | 341232 | 262495 | ||||
| Direct taxes paid | (7617) | (9336) | (12113) | |||
| Net cash flow from / (used in) operating activities | (39305) | 331896 | 250382 | |||
| Cash flow from investing activities | ||||||
| Purchase of fixed assets | (3142) | (8487) | (12253) | |||
| (Increase) / Decrease in HTM investments | (114393) | (140888) | (139963) | |||
| Sale of fixed assets / other assets | - | (670) | (1246) | |||
| Net cash flow from / (used in) investing activities | (117535) | (150045) | (153462) | |||
| Cash flow from financing activities | ||||||
| Proceeds from share premium | - | 6 | 6 | |||
| Increase / (Decrease) in TIER II bonds | - | - | (15000) | |||
| Interest paid on TIER II bonds | (2918) | (3635) | (6537) | |||
| Dividend paid (including tax on dividend) | (65) | (5830) | (5839) | |||
| Net cash from / (used in) financing activities | (2983) | (9459) | (27370) | |||
| Net Increase / (Decrease) in cash & cash equivalents | (159823) | 172392 | 69550 | |||
| Cash and cash equivalents at the beginning of the year | 439255 | 369705 | 369705 | |||
| Cash and cash equivalents at the end of the period / year | 279432 | 542097 | 439255 | |||
| The above Cash Flow Statement is based on indirect method. | ||||||
Notes:
1) The above financial results for the quarter/half year ended 30th September 2020 have been reviewed by the Audit Committee of the Board and approved by the Board of Directors at the meeting held on 30th October 2020. 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 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/half year ended 30th September 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 Reserve Bank of India 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, 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) The outbreak of 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 to mitigate the impact as well as regulatory measures notified by RBI. 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. The moratorium period / benefits, wherever granted, were excluded for the purpose of asset classification as per Income Recognition, Asset Classification and Provisioning (IRAC) norms during the moratorium period.
Bank is required to make additional provision @ 10%, over two quarters beginning with the quarter ended 31st March 2020, in respect of such borrowers whose accounts, though classified as Standard, would have become non-performing but for these benefits / relaxations. Accordingly, the aggregate provision held for the likely impact of COVID-19 was Rs. 120.01 crore as on 30th June 2020, which was higher than the requirement as per RBI guidelines dated 17th April 2020. Further, as a matter of prudence, the Bank has made an additional provision of Rs. 95.28 crore during the current quarter and the aggregate provision against the likely impact of COVID-19 stands at Rs. 215.29 crore as on 30th September 2020, inclusive of RBI mandated provision.
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. However, as a matter of prudence, an additional provision of Rs. 4.72 crore has been created in respect of such accounts for the quarter ended 30th September 2020.
Disclosure as per RBI circular DOR.No.BP.BC.63/21.04.048/2019-20 dated 17th April 2020
| Particulars | Rs. in lakh |
|---|---|
| 1. Outstanding amount as on 31st March 2020 in SMA/overdue categories where the moratorium/deferment was extended | 289646 |
| 2. Respective amount where asset classification benefits is extended (balance as on 30th September 2020)* | 46262 |
| 3. Provisions made during the quarter ended 31st March 2020 and 30th June 2020^ | 12001 |
| 4. Provisions adjusted during the quarter / half year ended 30th September 2020 against slippages | - |
(*) Out of these accounts, balances in SMA-0 is Rs. 16406 Lakh, SMA-1 is Rs. 13293 Lakh and SMA-2 is Rs. 16563 Lakh.
(^) As a matter of prudence, Bank holds additional provision over and above the RBI mandated provision.
7) Disclosures as per RBI circular DOR.No.BP.BC.72/21.04.048/2019-20 dated 23rd May 2020 and DOR.No.BP.BC.62/21.04.048/2019-20 dated 17th April 2020 in respect of accounts where the resolution period was extended for the half year ended 30th September 2020
| No. of accounts in which resolution period was extended | 2 |
| Amount involved (Rs. in lakh) | 12486 |
8) Pursuant to the Memorandum of Understanding dated 22nd July 2020 entered into between Indian Banks’ Association and Workmen Unions and Officers’ Associations, Bank has assessed the impact of proposed wage revision and has created an additional provision of Rs. 23.55 crore during the current half year (no provision was created during the corresponding period of previous year), pending finalization of bipartite settlement.
9) Provision Coverage Ratio as on 30th September 2020, calculated as per the guidelines of Reserve Bank of India, is 75.19% (previous period 61.82%).
10) 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
Place: Karur
Date: 30th October 2020
