The Karur Vysya Bank (KARURVYSYA) Q4 06/07 earnings summary

Executive summary

• FY07 total business reached Rs. 16,380.77 cr, comprising deposits of Rs. 9,340.29 cr and advances of Rs. 7,040.48 cr on the basis presented in the Chairman’s message.

• Net profit was Rs. 160.01 cr; net owned funds were Rs. 1,063.16 cr, entirely Tier I capital, and CRAR was 14.51% versus the 9% regulatory minimum.

Financial highlights

• Total income was Rs. 986.55 cr versus Rs. 771.45 cr; net profit was Rs. 160.01 cr versus Rs. 135.35 cr.

• Operating profit was Rs. 273.78 cr versus Rs. 228.64 cr; cost-to-income improved to 41.29% from 46.33%.

• Interest earned was Rs. 867.39 cr; interest expended rose to Rs. 520.29 cr from Rs. 367.96 cr.

• Advances increased 26.20% to Rs. 7,194.37 cr; yield on advances was 10.00% versus 9.49%.

• Deposits increased 23.27% to Rs. 9,340.29 cr; low-cost deposits were 27.71% of total deposits.

Outlook and guidance

• FY08 target: total business of Rs. 21,020 cr; branch network planned to exceed 300.

• Online trading with Demat services and additional customer-focused services planned; high interest rates expected to continue across the industry.

• Priorities included geographic expansion, low-cost deposit mobilization, customer retention through technology, strategic alliances and cost control.