CSB Bank (CSBBANK) Q4 13/14 earnings summary

Executive summary

• FY14 net profit fell to ₹26.88 crore from ₹32.67 crore; total business rose ₹1,188.08 crore to ₹22,381.22 crore, with a cautious lending strategy focused on SME, NRI and CASA growth.

• SME advances grew 16% and NRI business 43%; gold loans, corporate loans and wholesale deposits were reduced to de-risk the portfolio.

Financial highlights

• Net interest income rose to ₹379.20 crore from ₹339.22 crore; operating profit declined to ₹95.34 crore from ₹101.98 crore, and net profit to ₹26.88 crore from ₹32.67 crore.

• Total income was ₹1,621.31 crore versus ₹1,415.45 crore; profit before tax was ₹40.73 crore versus ₹41.89 crore.

• Deposits increased to ₹13,673.86 crore from ₹12,341.63 crore; advances declined to ₹8,707.36 crore from ₹8,851.52 crore; total assets rose to ₹15,315.55 crore from ₹13,620.12 crore.

• Treasury investment sale profit rose to ₹44.10 crore from ₹22.89 crore; treasury investment yield increased to 8.41% from 7.58%.

Outlook and guidance

• Positive business sentiment and signs of an economic recovery were expected to support growth; the stated priorities were SME and agricultural lending, NRI business, CASA, technology investment and branch expansion.

• A preferential share allotment and proposed IPO were intended to strengthen capital and fund growth; the preferential issue was expected to complete shortly after the reporting period.