Category: Banking & Finance

Karur Vysya Bank posts marginal rise in Q1 profit at ₹109 crore

Banking & Finance

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Karur Vysya Bank on Wednesday posted a marginal growth in its first quarter net profit at ₹109 crore.

The bank’s net profit for the same period last year stood at ₹106 crore. Operating profit on a y-o-y basis fell by ₹45 crore to ₹429 crore during Q1FY22. However, on a sequential basis, the operating profit went up by 72 per cent from ₹250 crore in Q4FY21.

Total income dropped to ₹1,596 crore in the April-June quarter as against ₹1,693 crore recorded in the same period last year.

Asset quality of the bank showed improvement on a y-o-y basis. Gross NPA as a percentage of total advances declined to 7.97 per cent for the first quarter of the current fiscal from 8.34 per cent in the previous year. However, net NPA marginally increased to 3.69 per cent (3.44 per cent) during the comparable period.

Total business as of June 2021 stood at ₹1,16,713 crore growing at 7.4 per cent Y-o-Y. While total deposits at the end of first quarter stood at ₹64,398 crore, advances stood at ₹52,315 crore.

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Sebi allows payments banks to act as investment bankers, BFSI News, ET BFSI

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NEW DELHI: To provide easy access to investors to participate in public and rights issues by using various payment avenues, markets regulator Sebi on Tuesday allowed payments banks to carry out the activities of investment bankers.

Non-scheduled payments banks, which have prior approval from the Reserve Bank of India (RBI), will be eligible to act as a banker to an issue (BTI), Sebi said in a circular.

This is subject to fulfilment of the conditions stipulated in the BTI rules.

Further, payments banks registered as a BTI will also be permitted to act as self-certified syndicate banks, subject to the fulfilment of the criteria laid down by the Sebi in this regard from time to time.

“The blocking/movement of funds from the investor to issuer shall only be made through the savings account of the investor held with the payments bank,” Sebi said.

In a notification dated July 30, the regulator amended the Bankers to an Issue rules, thereby permitting such other banking company, as may be specified by the Sebi, from time to time, to carry out the activities of Bankers to an Issue (BTI), in addition to the scheduled banks.

Bankers to an issue mean a scheduled bank or such other banking company as may be specified by Sebi carrying activities, including acceptance of application money, acceptance of allotment or call money, refund of application money and payment of dividend or interest warrants.



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RBI cautions public on fraudulent offers of buying/selling old banknotes and coins

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The Reserve Bank of India (RBI) on Wednesday cautioned the public to not fall prey to fictitious offers of buying and selling of old banknotes and coins.

This advisory comes in the wake of RBI coming across certain elements fraudulently using its name, logo and seeking charges, commission and tax from public, in transactions related to buying and selling of old banknotes and coins through various online or offline platforms.

The central bank clarified that it does not deal in such matters and never seeks charges/commissions of any sort.

Further, RBI has also not authorised any institution/firm/person to collect charges/commission on its behalf in such transactions.

RBI, in a statement, advised members of public to remain cautious and not to fall prey to elements using its name to extract money through such fictitious/fraudulent offers.

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SBI Q1 results: Standalone y-o-y net profit up 55% at ₹6,504 crore

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State Bank of India (SBI) reported a 55 per cent jump in standalone year-on-year (y-o-y) net profit at ₹6,504 crore in the first quarter ended June 30, 2021, on the back of healthy growth in other income and decline in loan loss provisions. This is the highest quarterly net profit posted by the bank.

India’s largest bank had reported a net profit of ₹4,189 crore in the year-ago quarter.

Net interest income (difference between interest earned and interest expended) increased by about 4 per cent y-o-y at ₹27,638 crore (₹26,642 crore in the year-ago period).

Loan loss provisions down

Total non-interest income, including fee income, profit/loss on sale of investments, forex income and miscellaneous income, rose about 48 per cent y-o-y at ₹11,803 crore (₹7,957 crore).

Now, another tool for SBI to resolve stress

Loan loss provisions were 47 per cent lower at ₹5,030 crore (₹9,420 crore).

Gross non-performing assets (GNPAs) increased by ₹7,870 crore during the reporting quarter to stand at ₹1,34,259 crore as at June-end 2021.

GNPA position improved to 5.32 per cent of gross advances against 5.44 per cent in the year ago quarter. However, GNPAs increased by 34 basis points over the preceding (Q4FY21) quarter.

Profits of India Inc improved markedly in FY21: SBI Ecowrap

Net NPA position too improved to 1.77 per cent of net advances against 1.86 per cent. However, NNPAs increased by 27 basis points over the preceding quarter.

SBI reported a 45 per cent y-o-y increase in consolidated net profit at ₹7,539 crore (₹5,203 crore).

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Equitas Small Finance Bank collection efficiency improves in July

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Equitas Small Finance Bank on Wednesday said its collection efficiency has improved to 104.62 per cent in July, up from 83.49 per cent in the previous month. However, the collection efficiency of the lender is still lower than 105.16 per cent recorded in April 2021.

On a product-wise basis, month-on-month collection efficiency in Microfinance went up to 91.76 per cent in July from 66.90 per cent in June while the collection efficiency of Small Business Loans went up to 109.19 per cent (85.14 per cent) during the period.

Equitas Small Finance Bank’s Q1 net profit drops 79%

Vehicle finance witnessed a collection efficiency of 99.75 per cent in July (89.33 per cent) while the efficiency in Corporate loans went up sharply to 159.91 per cent (103 per cent).

The overall billing efficiency of the Chennai-based lender also went up to 83.86 per cent in July from 69.52 per cent in the previous month. However, billing efficiency in July is lesser than 91.12 per cent recorded in March 2021.

Last week, the bank reported a net profit of ₹11.93 crore for the first quarter, 79 per cent down from the net profit of ₹57.67 crore posted for the same quarter last year.

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RBI cautions against offers of buying or selling old notes, BFSI News, ET BFSI

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A worker walks past the logo of the Reserve Bank of India (RBI) inside its office in New Delhi. (File Photo/Reuters)

Mumbai, The Reserve Bank of India (RBI) has cautioned the public from falling prey to offers of buying or selling of old bank notes and coins.

In a statement, the central bank said that certain elements are fraudulently using the name and logo of the Reserve Bank of India, and seeking charges, commission and tax from public, in transactions related to buying and selling of old banknotes and coins through various online and offline platforms.

“It is clarified that Reserve Bank of India does not deal in such matters and never seeks charges/commissions of any sort. The Reserve Bank of India has also not authorised any institution/firm/person etc to collect charges/commission on its behalf in such transactions,” it said.

The RBI has advised members of public to remain cautious and not to fall prey to elements using its name to extract money through such fictitious and fraudulent offers.

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IOB asks Union Bank to buy its stake in Malaysian bank, BFSI News, ET BFSI

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Indian Overseas Bank (IOB) has asked the Union Bank of India to buy its 35 per cent holding in India International Bank, Malaysia, a top IOB official said on Tuesday.

The India International Bank was originally a three-way joint venture between the Bank of Baroda (40 per cent stake), the IOB (35 per cent) and Andhra Bank (25 per cent). The Andhra Bank was taken over by the Union Bank of India as a part of the megabank merger scheme last year.

“We have asked Union Bank of India to buy our stakes. The valuation exercise is going on,” IOB Managing Director & CEO Partha Pratim Sengupta told reporters.

According to him, the IOB had decided to exit the Malaysian joint venture as part of its plan to come out of the Reserve Bank of India‘s (RBI) Prompt and Corrective Action (PCA) fold.

Though Sengupta said the IOB is expecting to be out of the PCA fold as it fulfills the RBI’s conditions, the decision to exit the India International Bank continues to hold.

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SBI’s Q1 profit jumps 55 pc to highest ever at Rs 6,504 cr, BFSI News, ET BFSI

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Mumbai (Maharashtra) [India], August 4 (ANI): Government-owned State Bank of India (SBI) on Wednesday reported its highest quarterly net profit of Rs 6,504 crore in the April to June quarter, marking an increase of 55 per cent in the year-ago period.

Operating profit increased by 5 per cent to Rs 18,975 crore in Q1 FY22 from Rs 18,061 crore in Q1FY21. Net interest income increased by 3.7 per cent year-on-year.

On the other hand, non-interest income at Rs11,803 crore grew by 24 per cent, said the country’s largest lender in a statement.

Total deposits grew at 8.82 per cent to reach Rs 37.2 lakh crore in Q1 FY22 from Rs 34.2 lakh crore in Q1 FY21. While current account deposits grew by 11.75 per cent, saving bank deposits grew by 10.55 per cent.

Domestic credit growth stood at 5.64 per cent, mainly driven by retail customers. Home loans, which constitute 23 per cent of the bank’s domestic advances, moved up by 11 per cent.

SBI said net NPA ratio stood at 1.77 per cent, down by 9 basis points. Gross NPA ratio came at 5.32 per cent, down 12 basis points.

The slippage ratio for Q1 FY22 is at 2.47 per cent from 0.6 per cent as at the end of Q1 FY21. Credit cost declined 77 basis points year-on-year to 0.79 per cent.

Cost to income ratio declined from 54.5 per cent in Q4 FY21 to 51.89 per cent in Q1 FY22 but increased by 187 basis points year-on-year, said SBI.

Capital adequacy ratio improved by 26 basis points to 13.66 per cent as on June 2021. Return on assets increased by 15 basis points to 0.57 per cent in Q1 FY22 against 0.42 per cent in Q1 FY21.

Return on equity increased by 357 basis points to 12.12 per cent against 8.55 per cent in the same period.

At 2:15 pm, SBI stock was trading 3.6 per cent higher on NSE India at Rs 462.55 per unit. (ANI)



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Shivalik Bank appoints Equirus Capital to raise growth capital, BFSI News, ET BFSI

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Shivalik Small Finance Bank (SSFB) has appointed Equirus Capital to raise Rs 100 crore as growth capital.

Shivalik SFB recently attained SFB status post successful transition as an Urban Co-operative Bank (UCB). The funds will be leveraed for digital expansion through fintech partnerships, physical expansion and product innovation.

Harsh Mittal, Chief Financial Officer, Shivalik Small Finance Bank said, “Our journey as a Small Finance Bank has been very exciting so far. The pace at which we have made progress to swiftly reach this stage is testimony to how meticulously we have planned our growth strategy, complemented by steps taken along the way to ensure we maintain a healthy balance sheet. We are pleased toappointEquirusCapital for the bank’s first fundraise as we look to onboard investors who believe in the vision of providing digital focussed financial services to the small and underserved segments.”

Also Read: After SFB license, Shivalik to raise its first fund of Rs 100 crore

Donald D’Souza, Managing Director and Co-Head at Investment Bank, Equirus Capital, “We are delighted to partner with Shivalik Small Finance Bank to assist them in executing their growth plans including in their capital-raising plans. We look forward to a long and fruitful association with the bank.”

The bank is in talks with a number of fintech and financial institutions for business collaboration in the area of deposits, loans and third-party products, including customer onboarding and digital payments.



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Stride Ventures announces first close of Stride Ventures India Fund II

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Venture lending fund Stride Ventures on Wednesday announced the first close of Stride Ventures India Fund II, for which it has secured commitments of ₹550 crore.

Stride Ventures has secured commitments of ₹550 crore, out of its target corpus of ₹1,000 crore, with an additional greenshoe option of ₹875 crore.

The fund received approval for its ₹1,875 crore plan from Securities Exchange Board of India (SEBI) in June 2021.

Stride Ventures founder and managing partner Ishpreet Gandhi said that there has been considerable tailwinds in the Indian startup ecosystem which presents a perfect opportunity to invest in the potential of venture debt in India.

“With the majority of investors from our maiden fund returning to invest in the new fund, we have had a quicker-than-expected first close. Their confidence remains resolute in our mission to build innovative alternate financing solutions for founders to help scale their startups more efficiently,” Gandhi said.

The firm remains on track to announce the final close of the second fund by the end of 2021. With its ability to recycle capital, Stride will effectively have more than ₹3,000 crore for funding startups across the tenure of the fund, the statement said.

Fund deployment

The firm aims to ramp up deployment in late-stage startups across sectors like business-to-business (B2B) commerce, healthcare, agritech, fintech and direct-to-consumer (D2C) brands with average ticket size of up to ₹75 crore.

“In addition to family offices and institutional investors, the firm will diversify its investor base outside India for Stride Ventures India Fund II, on the lines of the maiden fund. Amid growing investor confidence and a maturing Indian startup ecosystem, the new fund represents a significant opportunity for the firm to build a robust pipeline of deployments in the coming months,” the statement said.

Founded in 2019, Stride Ventures closed its maiden fund of ₹350 crore earlier this year.

Stride Ventures have made disbursals of over ₹400 crore in 2021, through 20 investments which includes start-ups like Pocket Aces, Miko, SUGAR Cosmetics etc and late stage startups like Infra.market, Spinny, Home Lane, Zetwerk and Bizongo.

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