Tag: DCB Bank

DCB Bank Q2 net profit down 21%

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DCB Bank reported a 21.08 per cent drop in its standalone net profit to ₹64.94 crore in the second quarter of the fiscal compared to ₹82.29 crore in the corresponding quarter a year ago.

The board of directors on Saturday also gave its in-principle approval to the lender to invest up to ₹2.04 crore to acquire 9.9 per cent shares in Svakarma Finance.

Svakarma Finance is an NBFC engaged in lending to micro, small and medium enterprises to meet their business requirements and to other financial institutions engaged in lending to these enterprises. In a stock exchange filing, the bank said it expects to complete the acquisition by December 31, 2021.

Meanwhile, for the quarter ended September 30, 2021, net interest income (NIM) declined by 3.3 per cent to ₹323 crore from ₹334 crore in the same quarter last fiscal. Net interest margin was at 3.37 per cent for the second quarter of the fiscal.

“NIM continues to be negatively impacted due to slippages and above normal liquidity maintained during this period,” DCB Bank said in a statement on Saturday.

Gross non performing assets

Non interest income however, increased by 21 per cent to ₹98 crore in the second quarter of the fiscal as against ₹81 crore a year ago. Provisions declined by 14.9 per cent to ₹86.33 crore in the July to September 2021 quarter from ₹101.45 crore a year ago.

Both gross non performing assets and net NPA slightly reduced in comparison to June 30, 2021. The Gross NPA as on September 30, 2021 was at 4.68 per cent of gross advances and net NPA was at 2.63 per cent compared to the gross NPA at 4.87 per cent and net NPA was at 2.82 per cent as on June 30, 2021.

However, they were significantly higher compared to September 30, 2020 when gross NPA was at 2.27 per cent and net NPA was at 0.83 per cent.

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Canara Bank cuts MCLR by up to 15 basis points, BFSI News, ET BFSI

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State-owned Canara Bank on Tuesday announced an up to 15 basis points cut in its marginal cost of funds based lending rate (MCLR). The bank has decided to reduce the MCLR for one-year tenor by 10 basis points to 7.25 per cent effective from October 7, Canara Bank said in a regulatory filing.

Most of the consumer loans such as personal, auto and home are priced on the basis of the one-year MCLR.

The bank has lowered MCLR on overnight and one-month tenors by 0.15 per cent to 6.55 per cent.

Meanwhile, DCB Bank also reduced its MCLR by 0.05 per cent across tenors, effective from October 6.

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DCB Bank gets RBI nod to conduct govt related transactions, BFSI News, ET BFSI

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DCB Bank on Thursday said it has received RBI nod to conduct government related transactions. The Reserve Bank has empanelled DCB Bank as an agency bank to facilitate banking and payment transactions for the central and state governments, it said in a release.

This empanelment follows the announcement by the Finance Ministry in May 2021 lifting the embargo on further allocation of government business to private sector banks.

Through this arrangement, DCB Bank will carry out specific banking services on behalf of both the central and state governments, while continuing to offer SME, micro SME and individual customers the convenience of routine financial transactions through its advanced banking platform, it said.

“DCB Bank’s focus is SME, micro SME, agri and inclusive banking, we look forward to supporting them by providing access to CBDT, CBIC, GST transactions amongst others,” said Praveen Kutty, Head of Retail Banking, DCB Bank.



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Net profit dips 57% to Rs 34 crore, BFSI News, ET BFSI

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New Delhi: DCB Bank on Saturday reported over 57 per cent decline in net profit at Rs 33.76 crore for June quarter 2021-22. The bank had posted a net profit of Rs 79.38 crore in the year- ago period. The profit was also down from Rs 77.91 crore in previous March quarter.

Total income during April-June 2021-22 was up at Rs 965.67 crore from Rs 950.70 crore in the year-ago period , DCB Bank said in a regulatory filing.

While the bank’s treasury income rose during the quarter, the corporate and retail banking income fell from the year-ago period.

Expenditure of the bank was higher during the quarter at Rs 764.48 crore as against Rs 759.56 crore.

Bad loans of the bank rose with gross non-performing assets (NPAs) jumping to 4.87 per cent of gross loans as of June 30, 2021 from 2.44 per cent by June 2020. Sequentially also, it was higher from 4.09 per cent at March-end 2021.

Net NPAs rose to 2.82 per cent from 0.99 per cent at June-end 2020 and 2.29 per cent by end of March 2021.

Provisions for bad loans and contingencies were raised significantly to Rs 155.54 crore in the quarter from Rs 83.69 crore in the year-ago period.



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DCB Bank Q1 net falls 57.5% to ₹34 cr

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DCB Bank reported a 57.5 per cent drop in its standalone net profit in the first quarter of the fiscal as provisions surged.

The private sector lender had a net profit of ₹33.76 crore for the quarter ended June 30, 2021 against ₹79.38 crore in the corresponding period last fiscal.

Total income was up by 1.6 per cent to ₹965.67 crore in the first quarter of the fiscal from ₹950.7 crore a year ago.

Net interest income saw marginal growth of 0.6 per cent on a year-on-year basis to ₹308.7 crore in the quarter ended June 30, 2021 from ₹306.73 crore a year ago.

Provisions surged by 85.9 per cent to ₹155.54 crore in the April to June 2021 quarter as against ₹ 83.69 crore in the first quarter of last fiscal.

During the quarter ended June 30, 2021, the bank holds contingency provision of ₹107.53 crore towards further likely impact of Covid-19 on standard restructured and stressed assets.

Asset quality deteriorated

Gross non-performing assets rose to 4.87 per cent of gross advances as on June 30, 2021 versus 2.44 per cent a year ago. Net NPAs also increased to 2.82 per cent of net advances as on June 30, 2021 compared to 0.99 per cent a year ago.

During the quarter, the bank sold certain non-performing loans of net book value of ₹43.99 crore to an asset reconstruction company for consideration of ₹38.77 crore.

The bank has implemented resolution plans for Covid-19 related stress under Reserve Bank of India’s August 6, 2020 circular for 2,149 accounts.

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Profit rises 13% to Rs 78 crore, BFSI News, ET BFSI

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Private lender DCB Bank on Saturday reported a 13 per cent increase in net profit to Rs 78 crore for the January-March quarter compared to that of Rs 69 crore in the year-ago quarter. Total income of the bank during the January-March quarter of 2020-21 fell to Rs 971 crore from Rs 1,012 crore in the same quarter of 2019-20, DCB Bank said in a regulatory filing. The income from interest as well as from investment fell during the reported quarter from a year ago.

For the FY2020-21, the bank’s net profit remained nearly flat at Rs 336 crore against Rs 338 crore in FY20. Income also was a tad down at Rs 3,917 crore in FY21 against Rs 3,928 crore in FY20.

The bank’s asset quality worsened with the gross non-performing assets (NPAs) spiking to 4.09 per cent of the gross advances as of March 31, 2021, as against 2.46 per cent by the end of March last year.

In value terms, the gross NPAs stood at Rs 1,083.44 crore, significantly higher than Rs 631.51 crore in the year-ago period.

Provisions for bad loans and contingencies in Q4FY21 came down to Rs 101.18 crore from Rs 118.24 crore a year earlier. Net NPAs stood at 2.29 per cent (Rs 594.15 crore) as against 1.16 per cent (Rs 293.51 crore).

On returning the compound interest to eligible borrowers post the Supreme Court final order in March and subsequent the RBI notification, the lender said it is in the process of account by account calculation of interest relief due to the eligible customers.

In the meantime, as of March 31, 2021, the bank has created liability towards estimated interest relief of Rs 10 crore and reduced the same from the interest income.

The bank said it held contingency provision of Rs 229.11 crore against the likely impact of Covid 19 regulatory package, impact of the conclusion of the interim order (of Supreme Court on not declaring accounts as NPAs till August 31, 2020 and after) and other contingencies.

On the impact of second wave of the pandemic, it said under the current circumstances the bank during March quarter, on a prudent basis, has made a contingency provision of Rs 124 crore towards further likely impact of Covid-19 on restructured and stressed assets.

“In addition to this contingency provision of Rs 124 crore, the bank also holds floating provision amounting to Rs 108.80 crore, besides, provisions for standard assets and specific non-performing assets,” it said.

Besides, the amount in overdue categories where the moratorium or deferment was extended as of March 31, 2020 was Rs 1,908.08 crore at end of March this year, it said. The provisions held on these by the end of September 2020 was Rs 68 crore and similar amount was kept as provisions adjusted against slippages (NPA and restructuring), DCB Bank said.

The lender also said that its board has not recommended any dividend for fiscal ended March 2021 in view of the situation developing around Covid-19 in the country and the related uncertainty that it creates.



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DCB Bank Q4 net profit rises 13%

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DCB Bank has reported a 13 per cent jump in its net profit for the quarter ended March 31, 2021 at ₹78 crore compared with ₹69 crore in the same period the previous fiscal.

For 2020-21, its net profit fell marginally to ₹336 crore compared with ₹338 crore in 2019-20.

The bank’s net interest income fell four per cent to ₹311 crore in the January to March 2021 quarter versus ₹324 crore a year ago.

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RBL, DCB and Federal Bank may hunt for new CEOs, BFSI News, ET BFSI

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It’s not just Kotak Mahindra Bank that has to do succession planning after the RBI capped the tenure of private bank CEOs at 15 years.

DCB Bank, RBL Bank and Federal Bank will have to look for new CEOs after the term of current ones ends in the next three years.

DCB Bank CEO Murali Natrajan has completed 12 years in the job and got a year’s extension this month.

Federal Bank CEO Shyam Srinivasan will complete 11 years in September when his second consecutive one-year extension ends.

RBL’s Vishwavir Ahuja also completes 11 years in June and is awaiting the RBI nod for another three-year term after the bank’s board approved such a proposal in January. Federal Bank and RBL boards have sought three-year terms for their CEOs. It remains to be seen whether the RBI will give this extension, which is within the 15-year limit.

Why the move?

The regulator’s directions on limiting CEO tenures come after the publication last summer of a discussion paper that had sought a review of the governance framework at commercial banks. A bank CEO who is also a promoter or major shareholder cannot hold these posts for more than 12 years, the revised RBI rules said.

Experts say governance lapses at Yes Bank also prompted the move by the central bank.

The new norms do not apply to bank CEOs whose tenures have already been approved by RBI.

“Banks with MDs & CEOs or whole-time directors (WTD) who have already completed 12 or 15 years as MD & CEO or WTD, on the date these instructions come into effect, shall be allowed to complete their current term as already approved by the Reserve Bank.”The banking regulator said

The impact

Bankers said the central bank’s move could hurt stability at small and medium private sector banks that require strong leadership and an understanding of the business to stand out in a competitive lending business. In a related move, the RBI has directed that half the directors in banks be independent ones. It has also put an annual Rs 20-lakh ceiling on fees to be paid to independent directors. It also said that independent directors have to chair bank boards.

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DCB Bank acquires minority stake in Techfino Capital

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DCB Bank Limited, a private sector bank, has acquired a minority equity stake of about 9 per cent in Bengaluru-based non-banking financial company (NBFC), Techfino Capital Private Limited (TCPL).

The funds raised by TCPL will be used in enhancement of current tech stack apart from on-lending to customers. Techfino provides customised consumer loans in education and healthcare sectors. It is present in key metros and tier II cities across India.

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Complementing strengths

Narendranath Mishra, Head, Agri and Inclusive Banking, DCB Bank, said, “DCB Bank and TCPL are delighted to be associated in this manner. Micro loans or granular loans as a financial solution hold much promise. We value each other’s experience and expertise to build a granular loan portfolio with patience and nuance. DCB Bank and Techfino complement each other’s strengths, and this is an opportunity for both organisations to grow the customer franchise.”

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Jayaprakash Patra, Co-Founder Director, Techfino Capital Private Limited, added, “The association with DCB Bank is an important milestone. It shall help in the growth of the business as TCPL goes about providing financing solutions to its customers. Together, we aim to create a win-win ecosystem, offering our customers a bouquet of customised financial solutions using TCPL’s robust technology platform.”

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DCB Bank acquires 9% stake in Techfino Capital, BFSI News, ET BFSI

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DCB Bank, announced that it has purchased a minority equity stake in Techfino Capital Private Limited worth approximately 9%. (TCPL). Techfino, a non-banking financial company (NBFC) headquartered in Bengaluru offers customised consumer loans in the education and healthcare sectors through its technology platform.

DCB Bank serves diverse business segments comprising retail, micro-SME, SME, mid-Corporate, Agriculture, Commodities, Government, Public Sector, Indian Banks, Co-operative Banks, and Non-Banking Finance Companies (NBFC).

Narendranath Mishra, Head Agri and Inclusive Banking, DCB Bank, said, “DCB Bank and TCPL are thrilled to work together. As a financial solution, micro or granular loans hold a lot of promise. To build a granular loan portfolio with patience and nuance, we respect each other’s experience and expertise. The strengths of DCB Bank and Techfino complement each other, and this is an opportunity for both companies to expand their consumer franchise.”

Jayaprakash Patra, Co-Founder Director, Techfino Capital Private Limited, said, “The association with DCB Bank is an important milestone. Using TCPL’s comprehensive technology platform, we hope to build a win-win environment by providing our customers with a variety of customised financial solutions. The funds raised will be used in enhancement of the current tech stack apart from on-lending to customers.”



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