Capital Adequacy Ratio and CASA growth was healthy for the quarter: Jaimin...

Capital Adequacy Ratio and CASA growth was healthy for the quarter: Jaimin Bhatt

 

Established in 1985, Kotak Mahindra Group is one of India’s leading financial services conglomerate.As on September 30, 2017, Kotak Mahindra Bank Ltd, has a national footprint of 1,362 branches spread across 689 locations and 2,164 ATMs. The consolidated net worth of the Group stands at Rs 46,975 cr as on September 30, 2017. The Group offers a wide range of financial services that encompass every sphere of life. From commercial banking, to stock broking, mutual funds, insurance and investment banking, the Group caters to the diverse financial needs of individuals and the corporate sector. The Group has a wide distribution network through branches and franchisees across India, an International Business Unit at GIFT city, Gujarat and international offices in London, New York, Texas, California, Dubai, Abu Dhabi, Mauritius and Singapore.

Yash Ved of NewsBarons provides you the highlights of a media interaction, where Jaimin Bhatt, President & Group Chief Financial Officer, Kotak Mahindra Bank says “The growth was across the board in terms of commercial, vehicles and consumer. “

NB: Brief us about your Financials?

Jaimin Bhatt: We have reported results for the second quarter ended 30th September, 2017.

The PAT for the quarter increased to Rs.1441 crore from Rs1202 crore in Q2FY17 ,up 20%.NIM was stable at 4.30%.

Net Interest Income (NII) for Q2FY18 up 16% to Rs 2,313 crore from Rs 1,995 cr in Q2FY17.

NB:How was the performance for Q2?

Jaimin Bhatt: Capital Adequacy Ratio and CASA growth was healthy for the quarter. CASA ratio as on September 30, 2017 stood at 47.8% compared to 39.0% as on September 30, 2016.
The Advances were up by 22% to Rs.187,758 crore for the quarter. The growth was across the board in terms of commercial, vehicles and consumer.

The Total assets managed / advised by the Group as on September 30, 2017 were up 40% at Rs169,214 cr (Rs. 120,705 crore as on September 30, 2016).

Networth as on September 30, 2017 was Rs 46,975 cr (Rs 35,690 cr as on September 30, 2016).

In addition to the Bank, major subsidiaries who contributed to profit after tax for Q2FY18 are Kotak Mahindra Prime Rs 150 cr, Kotak Securities Rs 118 cr, Kotak Mahindra Old Mutual Life Insurance Rs 100 cr and Kotak Mahindra Investments Rs 55 cr.

There was also the big pick up in small businesses and there was the growth in Corporate segment.

As on September 30, 2017, the Bank has a network of 1,362 full-fledged branches and 2,164 ATMs affording it the capacity and means to serve its customers through its wide presence.

The credit growth will depend upon how GDP numbers will come in the coming quarters.

NB: Brief us about your merger deals for the quarter?

Jaimin Bhatt: On receipt of all the requisite approvals, the Bank acquired 26% stake in Kotak Life from Old Mutual plc. for Rs 1,293 cr on October 13, 2017. Post the transaction, Kotak Life becomes a 100% subsidiary of the Bank. Also, on September 27, 2017, the Bank consummated the transaction of acquisition of BSS Microfinance as a subsidiary of the Bank.

We will also be looking at acquisitions in insurance space.

NB: What were the slippages for the quarter?

Jaimin Bhatt: The slippages for the quarter were roughly at Rs. 400 crore.

NB: Brief us about your Digital business for the quarter?

Jaimin Bhatt: Digital remains an area of focus for the Group. Bank and other subsidiaries like Securities, Insurance, Mutual Fund and Kotak Prime are gaining significant traction and market share.

On March 29, 2017, the Bank launched 811 – a completely digital and paperless account opening experience. The Total customers of the Bank are around 10.5 mn as on September 30, 2017.

Transactions for the Bank on mobile platform grew by 125% in terms of volume in Q2FY18 vis a vis a year ago.

During Q2FY18, the share of Recurring Deposits sourced digitally was 77% and that of Term Deposits was 60%. The digital share of salaried personal loans rose to 29% in Q2FY18.

During the quarter, the Bank also launched a new customer centric; mobile first website with a view to service customers better.

In the case of Kotak General Insurance, more than 25% of new business sourced through digital channels in Q2FY18. We also launched online consumer durable finance loans through fintech tie-ups in Kotak Prime.