Tag: IDFC First Bank

Bankers in talks as court rulings threaten over $6 billion in loans, BFSI News, ET BFSI

Banking & Finance

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Informal talks are taking place to deal with the fall-out from two rulings by Supreme Court that threaten the repayment of loans totalling nearly 500 billion rupees ($6.73 billion) to some of India’s largest banks, bankers close to the matter say.

Any failure to recoup the money adds to stress in the banking sector, which is already dealing with an increased level of bad loans and reduced profits because of the impact of the pandemic.

Last week, Supreme Court effectively blocked Future Group’s $3.4 billion sale of retail assets to Reliance Industries, jeopardising nearly $2.69 billion the retail conglomerate owes to Indian banks.

That ruling was delivered days after the Supreme Court rejected a petition to allow telecom companies to approach the Department of Telecommunications to renegotiate outstanding dues in a long-runinng dispute with Indian telecom players.

That raises concerns, bankers say, over whether Vodafone Idea will repay some 300 billion rupees ($4.04 billion) it owes to Indian banks and billions of dollars more in long-term dues to the government.

FUTURE OF FUTURE?

Two bankers, speaking on condition of anonymity said negotiations were taking place to try to limit potentially severe consequences.

Loans to Future worth nearly 200 billion rupees were restructured earlier this year, giving it more time to come up with repayments due over the next two years, but that was on the premise that Reliance would bail it out, the bankers said.

Future group did not immediately respond to a request for comment.

Should Future be taken to a bankruptcy court, bankers say they are concerned they will have to take haircuts on the loans of more than 75%.

“The immediate apprehension is that the restructuring deal will fall through for banks by December,” said a banker at a public sector bank that has lent money to Future.

Future’s leading financial creditors include India’s largest lender State Bank of India, along with smaller rivals Bank of Baroda and Bank of India.

Bank of India, the lead bank in consortium lending to Future, did not immediately respond to an emailed request for comment.

VODAFONE IDEA

Banks have also started discussing Vodafone’s debt to lenders of nearly 300 billion rupees. Top lenders to Vodafone include Yes Bank, IDFC First Bank and IndusInd Bank, as well as other private and state-owned lenders.

Vodafone, Yes Bank, IDFC First Bank and IndusInd did not immediately respond to a request seeking comment.

“Even though banks have the option of restructuring loans in case the company defaults, it will only make sense if there is clear cash flow visibility, which is not the case right now,” a senior banker at a public sector bank said on condition of anonymity.

Already, at the end of March, Indian banks had total non-performing assets of 8.34 trillion rupees ($112.48 billion), the government has said. It has yet to provide more updated figures.



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Banks head towards recovery after challenging environment due to the second wave of covid-19, BFSI News, ET BFSI

Banking & Finance

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The second Covid-19 wave has impacted the recovery and lending activities of commercial banks. From tackling scattered lockdowns to managing recovery and collections, banks are expecting a recovery phase in the coming quarters.

Private lender Federal Bank recorded the highest ever operating profit of Rs.1135 Cr with 22% Y-o-Y growth in Q1FY22. The total business of the bank reached Rs. 299158.36 Cr registering Y-o-Y growth of 8.30% as of 30th June 2021.

Shyam Srinivasan, Managing Director, and CEO, Federal Bank said in a statement, “The external environment continues to be challenging however we have managed to keep our operating momentum intact by delivering our highest ever operating profit, for the quarter. Our CASA ratio is at an all-time high and we continue to build a granular liability franchise with more than 90% of our deposits being retail in nature. Our relationship with the NR diaspora continues to blossom with our share in personal inward remittances increasing to 18.20%. We have also managed to keep asset quality in check with only a marginal uptick in GNPA and NNPA.”

Shyam Srinivasan (File Pic)

On similar lines, IDFC FIRST Bank in its Q1FY22 financial results announced the highest ever core pre-provisioning operating profit at Rs. 601 Crore. Total Income grew by 36% YoY basis to reach Rs. 3,034 crore in Q1FY22.

V Vaidyanathan, Managing Director, and CEO, IDFC FIRST Bank, said in a statement, “Our CASA ratio is high at 50.86% despite reducing savings account interest rates by 200 bps recently. Because of our low-cost CASA, we can now participate in prime home loans business, which is a large business opportunity.”

“Regarding the loss during the quarter, we have made prudent provisions for COVID second wave, and expect provisions to reduce for the rest of the three quarters in FY 22. We guide for achieving pre- COVID level Gross and Net NPA, with targeted credit loss of only 2% on our retail book by Q4 FY 22 and onwards, assuming no further lockdowns.” Vaidyanathan added.
Banks head towards recovery after challenging environment due to the second wave of covid-19
South-based lender CSB Bank in its First Quarter results announced a profit after tax at Rs 61 Cr in Q1FY22 as against Rs 53.56 Cr in Q1FY21 and Rs 42.89 Cr for the sequential quarter. Net profit increased by 14% YoY. The operating profit of the bank is Rs 179.78 Cr with a Y-o-Y -growth of 39%.

CVR Rajendran, Managing Director & CEO at CSB Bank said in a statement, “COVID second wave coupled with the LTV management of gold loans did pose some challenges in the first quarter of FY 22. Lockdowns, alternate holidays, slowing down of economic activity, controlled movements due to strict social distancing norms, lack of transport, etc restricted the customer access to branches which in turn impacted both the fresh pledges and releases. Thankfully, the worst seems to be over now and recoveries are happening in full swing. The portfolio LTV that was at 83% has been brought down to 75%. The aggressive vaccination push and controlled localised lockdowns have helped in managing the second wave to a great extent and we are optimistic to catch up the business opportunities on a larger scale from this quarter.
Banks head towards recovery after challenging environment due to the second wave of covid-19
Bandhan Bank also announced its Q1FY22 results with pre-provision Operating Profit (PPOP) at 9.3%; up from 8.6% in the Q4FY21.

Chandra Shekhar Ghosh, Managing Director, and CEO of Bandhan Bank said in a statement, “Despite the challenging environment due to covid second wave, we have delivered the best-ever quarter in terms of operational performances. Collections continue to improve with covid restrictions getting relaxed. Typically, the second half of the financial year is always better for the bank in terms of growth and collections. With the easing of the covid second wave and upcoming festive season, we are confident of achieving better performance going forward.”
Banks head towards recovery after challenging environment due to the second wave of covid-19
While Axis Bank reported a 94 percent year-on-year rise in standalone net profit at Rs 2,160 crore as against Rs 1,112 crore reported in the same quarter of last year (Q1FY21).

Amitabh Chaudhry, MD & CEO, Axis Bank said, “Despite second wave headwinds, we made tremendous progress this quarter on our strategy of building a high-quality granular franchise, increasing our relevance in the lives of the customers and the communities we serve, and building the best digital bank in the country,”

“The journey we started two years back is gathering momentum with a strong balance sheet, conservative provisions, and a steady operating performance supporting our aspirations. We have also set a bold mandate for our long-term ESG goals. We continue to monitor the macroeconomic environment closely and we remain confident about our strategy and the road ahead,” Chaudhry said.

Amitabh Chaudhry (File Pic)
Amitabh Chaudhry (File Pic)

The country’s largest lender, The State Bank of India recorded its highest-ever quarterly profit at Rs 6,504 cr. in Q1FY21. This implied a 55-per cent year-on-year (YoY) rise in net profit compared to Rs 4,189.34 crore in the year-ago period.
Dinesh Khara, chairman of SBI said, “Around 50% of our home loan book is to non-salaried customers which belong to the SME segment,”
Banks head towards recovery after challenging environment due to the second wave of covid-19
“The slippages are largely because of the disruption in the SME segment.” He also said, “SBI is expecting a credit growth of 9% during this financial year. The under-utilization of credit lines by borrowers in our corporate clients group has dropped to 25%,” Khara said. “That’s a positive,” he added.

SBI says that the bank is gearing up on several fronts to mitigate all the challenges posed by the spread of the COVID-19 pandemic.



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Our provision numbers will fall to just 2% of advances eventually: V Vaidyanathan, CEO, IDFC First Bank

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Another reason also is that we are doing prime home loans, which has hardly any delinquency. Don’t go by this quarter provisions, we recognised early because of the nature of our stiff provisioning policy.

IDFC First Bank expects the government to prevent a duopoly in the telecom sector, MD & CEO V Vaidyanathan tells Shritama Bose. The lender expects its credit costs to taper off over the years, he says. Edited excerpts:

Loan growth has been anaemic for the whole industry for a while now at 5-6% levels. You have grown at 9%. What is driving that?

The main thing is that we’ve started home loans, and that was the biggest driver of growth. A quarter ago, we brought down the interest rate on savings accounts from 6% to peak rate of 5%. Therefore, we have suddenly become competitive in the prime home loan segment.

Q1 was a difficult quarter for collections. Are you seeing a pullback thereafter?

After mid-June, we have been seeing a sharp recovery in the collections. In pre-Covid February 2020, the collection level was 98.8% and in July 2021 collections in the early bucket have risen to 99.4% … That is why we are guiding that our provision numbers will be coming down to just 2% of the advances going forward, below pre-Covid levels, which would be pretty good. Another reason also is that we are doing prime home loans, which has hardly any delinquency. Don’t go by this quarter provisions, we recognised early because of the nature of our stiff provisioning policy.

Retail distress has risen in Q1 mainly because of lower collections. Could the distress be more entrenched for some households?

No. If that were the case, how could our early or current bucket collections have come back to the 99.4% level after the Covid second wave? The cash flows of customers were affected, once their cash flows came back, they began to honour the instalments.

There is concern around a telecom company which is not stressed, but has sent out rescue calls to the government. How are you dealing with that exposure?

We believe the government will try to work out some solution to keep it a viable industry and it won’t become a duopoly for India’s sake. We were transparent about this account, we identified it early, and have a provision of Rs 487 crore on this account already. Our capital adequacy is already 15.6%. So, theoretically, just to simulate, even if we charge the entire 100% on the funded exposure of Rs 2,000 crore, our capital adequacy will still be very strong at around 14.7%. Not that we intend to do that, but just to simulate, even if it did get there, we are prepared. We have a very profitable incremental business. One day all these issues will become history.

What is the profitability outlook?

We have been profitable for the last five quarters. Last quarter, we hit the highest ever core pre provisioning operating profit of Rs 601 crore in the history of the bank, which is more than double since the merger. This despite adding 400 branches, 600 ATMs, hiring 12,000 employees, launching credit cards, salary accounts, fast tags, Fleet cards, building the technology layer, and growing Rs 50,000 crore of retail liabilities … So obviously, the incremental lending is very profitable, which is buffering these investments in liabilities. As the past issues go away, you will see it more in the profits line.

But there have been too many issues in infrastructure?

Yes, that’s the nature of any infra DFI (development finance institution). Whether Dewan, Reliance Infra or this telecom, they are all legacy businesses. Not a single new corporate account booked post-merger is even in SMA1 in the last two-and-a-half years.

This conversion from the DFI has taken too long.

You ask Mr. (KV) Kamath how hard it is. He is the only other person that I know who has converted a DFI to a bank. By the time you raise new low-cost retail liabilities, replace the high-cost liabilities and run off old loans, it takes years, and meanwhile it drags profit down. Even today, we are carrying Rs 27,500 crore of infrastructure and other past borrowings where we are paying 8.6%, which we will replace with sub-5% and save about Rs 1,000 crore a year. That’s why it takes time. But once done, this will be an amazing institution. All issues, whether infra or the telecom, will go away today or tomorrow.

One of the options being floated is that banks take over the company.

We are not even thinking along those lines. We are holding bonds. We have dealt with many things in our life, we will deal with this situation also.

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A collapse of Voda Idea will hurt IDFC First Bank, YES Bank most, BFSI News, ET BFSI

Banking & Finance

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MUMBAI: The looming prospect of a financial crisis in India’s third-largest telecom operator, Vodafone Idea, will spell disaster for some of the country’s biggest private sector banks just when they were recovering from a multi-year bad loan cycle.

The refusal by existing promoters of Vodafone Idea to infuse cash in the debt-laden company and the Supreme Court’s recent dismissal of a plea for rectification of alleged miscalculation in adjusted gross revenue dues payable by the company to the government have condemned the telecom operator to bankruptcy, unless it can raise fresh capital.

Prospects of fund raising for the company look grim given that any new strategic investor will have to pour in billions of dollars that will largely be channelled to the government coffers and will not be reinvested in the company to prepare it for the new 5G world.

The resignation of Kumar Mangalam Birla as head of the company and his offer to the government to buy out Aditya Birla group’s stake is likely to further discourage potential investors.

In that backdrop, Vodafone Idea is unlikely to be able to service its gross debt of over Rs 1.8 lakh crore. The telecom operator owes at least Rs 28,700 crore to several state-owned and private sector lenders.

The highest exposure is with State Bank of India at Rs 11,000 crore followed by Yes Bank at Rs 4,000 crore and IndusInd Bank at Rs 3,500 crore. However, in terms of percentage of loan book, the biggest hit from Vodafone Idea’s default will be to IDFC First Bank as it has an exposure of 2.9 per cent of its loan book followed by YES Bank at 2.4 per cent and IndusInd Bank at 1.65 per cent.

According to media reports, IDFC First Bank has already marked Vodafone Idea as stressed and provided for 15 per cent of the outstanding debt.

While Vodafone Idea is a one-off large account instead of the torrent of defaults seen over the past 10 years, it could have a bearing on the earnings performance of these banks in the coming quarters, as they will have to make hefty provisions against these loan accounts.

No surprise then that SBI was the worst Nifty50 performer today, down 3.3 per cent. Shares of IDFC First Bank tanked over 5 per cent, while those of YES Bank 2 per cent.



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IDFC First Bank reports net loss of ₹630 crore in Q1 on higher provisions

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Private sector lender IDFC First Bank reported a standalone net loss of ₹630.04 crore in the first quarter of the fiscal year due to a sharp rise in provisions.

The bank had reported a standalone net profit of ₹93.54 crore in the quarter ended June 30, 2020.

Total income grew by 11.4 per cent to ₹4,938.05 crore in the first quarter of the fiscal from ₹4,434.12 crore a year ago.

The bank’s net interest income grew by a robust 25 per cent to ₹2,185 crore in the quarter ended June 30, 2021 as against ₹1,744 crore a year ago.

Net interest margin was 5.51 per cent as on June 30, 2021 versus 4.86 per cent a year ago and 5.09 per cent in the fourth quarter of 2020-21. In a statement on Saturday, the bank said this was because the cost of funds further reduced.

Other income surged by 75.1 per cent to ₹848.76 crore from ₹484.85 crore a year ago.

Additional Covid-19 provisions

Provisions shot up by 145.9 per cent to ₹1,878.61 crore in the first quarter of the fiscal as against ₹764.08 crore in the corresponding period a year ago.

“The bank has created additional Covid-19 provisions of ₹350 crore during the quarter taking the total Covid-19 provision pool to ₹725 crore. The bank believes that the full estimated impact of second wave of Covid is now provided for in the books of the bank,” it said.

Noting that there was no moratorium provided to customers during the second wave of the pandemic, it said that there was ageing provisions that were required to be taken as per its conservative provisioning norms.

“The bank believes that these provisions may not reflect actual economic loss but represent a delay in timing of repayments,” it further said.

Based on the recent portfolio quality indicators (latest cheque bounce trends, collection efficiency, vintage analysis), the bank said it expects the provisions to taper off for the rest of the year if there is no third wave of the pandemic.

“Regarding the loss during the quarter, we have made prudent provisions for Covid second wave, and expect provisions to reduce for the rest of the three quarters in the fiscal. We guide for achieving pre – Covid level gross and net NPA, with targeted credit loss of only two per cent on our retail book by the fourth quarter of 2021-22 and onwards, assuming no further lockdowns,” said V Vaidyanathan, Managing Director and CEO, IDFC First Bank.

The bank’s asset quality deteriorated. Gross non performing assets shot up to ₹4,667.12 crore or 4.61 per cent of gross advances as on June 30, 2021 from 4.15 per cent as on March 31, 2021 and 1.99 per cent a year ago.

Net NPAs also rose to 2.32 per cent of net advances from 0.51 per cent as on June 30, 2020.

Standard restructured outstanding portfolio (under the Covid-19 relief package provided by the RBI) in retail loans was 1.81 per cent of the overall retail loan book as of June 30, 2021. Restructuring for the overall portfolio stood at 2.01 per cent of the total funded assets.

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IDFC First Bank logs Rs 630 crore loss in Q1 on Covid provisioning, BFSI News, ET BFSI

Banking & Finance

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Private lender IDFC First Bank on Saturday reported a net loss of Rs 630 crore in the April-June quarter due to provisioning measures for cushioning the impact of the second wave of the Covid-19 pandemic. The bank had posted a net profit of Rs 93.55 crore in the year-ago quarter ended in June 2020 and that of Rs 127.81 crore in the previous quarter ended in March 2021.

“Net loss of Rs 630 crore for Q1FY22 is because of prudent provisions for Covid wave 2.0. Covid provision pool increased from Rs 375 crore to Rs 725 crore during the current quarter on a prudent basis to act as a cushion for Covid impact,” IDFC First Bank said in a release.

The bank expects to collect a reasonable proportion of these dues in due course, it added.

Total income (net of interest expense) grew by 36 per cent year-on-year to Rs 3,034 crore in Q1FY22, driven by the growth in NII and fee income, the bank said. Its total income during Q1FY21 stood at Rs 2,229 crore in June 2020 quarter.

The bank said its net interest margin (NIM) — the difference of interest earned and expended — was the highest ever at 5.51 per cent during the reported quarter. The NIM was 4.86 per cent in year ago quarter.

The net interest income (NII) rose by 25 per cent year-on-year to Rs 2,185 crore.

On the asset front, bank’s gross and net non-performing assets (NPAs) were at 4.61 per cent and 2.32 per cent respectively as of June 30, 2021.

The NPA ratios were up from 1.99 per cent and 0.51 per cent respectively, from year ago period.

“The GNPA and NNPA include impact of 84 bps (basis points, which is one hundredth of a percentage) and 71 bps respectively on account of one Mumbai based infra toll account which slipped during the quarter. The bank expects no material economic loss in this account eventually as this is an operating toll road and is only delayed.”

Bank deposits were up by 36 per cent to Rs 84,893 crore. The retail loan book of the lender increased to Rs 72,766 crore as on June 30, 2021 from Rs 56,043 crore.

The year-on-year growth of the retail loan book was 27 per cent excluding Emergency Credit Guarantee Line loan book of Rs 1,645 crore. However, it declined by 1.2 per cent on a sequential basis. The wholesale loan book fell by 15 per cent to Rs 34,232 crore from Rs 40,275 crore.

Capital adequacy ratio stood at 15.56 per cent with CET-1 (common equity tier-1) ratio at 14.86 per cent. Average liquidity coverage ratio (LCR) was at 166 per cent for Q1FY22.

“Within just two years we have made tremendous progress at the bank. Our CASA (current account savings account) ratio is high at 50.86 per cent despite reducing savings account interest rates by 200 bps recently, which points to the trust customers have in our bank and service levels.

“Because of our low cost CASA, we can now participate in prime home loans business, which is a large business opportunity,” V Vaidyanathan, Managing Director and CEO, IDFC First Bank, said. Regarding the loss during the quarter, he said the bank has made prudent provisions for Covid second wave.

“We expect provisions to reduce for the rest of the three quarters in FY22. We guide for achieving pre-Covid level gross and net NPA, with targeted credit loss of only 2 per cent on our retail book by Q4FY 22 and onwards, assuming no further lockdowns,” he said further.



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IDFC reverse merger in IDFC First Bank likely as RBI allows exit, BFSI News, ET BFSI

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The Reserve Bank of India had allowed IDFC to exit the IDFC First Bank.

In a regulatory filing, IDFC said that the RBI on July 20 clarified that “after the expiry of lock-in period of five years, IDFC Ltd can exit as the promoter of ‘IDFC FIRST Bank Ltd”.

Accordingly, the company can now exit as the promoter of IDFC First Bank, as the five year lock-in period has ended.

The IDFC Bank was created by the demerger of the infrastructure lending business of IDFC to IDFC Bank in 2015.

The RBI clarification could potentially lead to a reverse merger, which would be beneficial to IDFC Limited shareholders by increasing shareholder value.

Reverse merger

IDFC First Bank, which started operations in October 2015, completed five years on September 30, 2020. Under the rules then, a non-operating financial holding company, IDFC Financial Holding Co Ltd was mandated to hold a minimum of 40% of the paid-up capital of the bank for five years. IDFC holds 100% stake in the holding company, and in turn 36.56% in the bank.

The board may consider a reverse merger between IDFC and the bank, and collapse the holding company structure.

An application would have to be submitted for such a reverse merger. The RBI had mandated a holding company structure to ring-fence the bank from other financial services businesses of the group. A reverse merger, which has been in talks, would be beneficial to the shareholders of IDFC as it would remove the holding company discount. While the 2013 rules mandated it, in the 2016 guidelines for “on-tap” bank licensing, the RBI had not sought the requirement of holding a company for promoter if there are no other group entities.

IWG suggestions

The RBI’s internal working group on ownership of private banks had also recommended allowing banks, currently under holding company structure, to exit if they do not have other group entities. Recently, the RBI allowed Equitas Small Finance Bank and Ujjivan Small Finance Bank to apply for the merger of the holding company with the bank.

While the suggestions of the internal working group have not yet been implemented, the regulations are clear in terms of the holding company quitting only if it has no other organisations in its fold, paving an alternative road to departure for corporations like IDFC.



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RBI allows IDFC to exit as promoter of IDFC First Bank, BFSI News, ET BFSI

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MUMBAI: The Reserve Bank of India (RBI) allowed IDFC to exit as the promoter of IDFC First Bank.

In a regulatory filing made to the BSE, IDFC said that the RBI on July 20 clarified that “after the expiry of lock-in period of 5 years, IDFC Limited can exit as the promoter of IDFC First Bank Limited.”

Accordingly, the company can now exit as promoter of IDFC First Bank, as the five year lock-in period has ended.

The IDFC Bank was created by demerger of the infrastructure lending business of IDFC to IDFC Bank in 2015.

“After the lock-in period, the RBI has allowed IDFC to withdraw as a promoter of IDFC First Bank. The above clarification could potentially lead to a reverse merger, which would be beneficial to IDFC Limited shareholders by increasing shareholder value,” said Sonam Chandwani, managing partner at KS Legal Associates.

“Also, while the suggestions of the internal working group have not yet been implemented, the regulations are clear in terms of the holding company quitting only if it has no other organisations in its fold, paving an alternative road to departure for corporations like IDFC.”



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IDFC says can exit as promoter of IDFC First Bank since five-year lock-in period over

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IDFC said it can exit as the promoter of IDFC First Bank since the five year lock-in period has ended. This is based on the communication with the Reserve Bank of India.

“… the RBI vide its letter …dated July 20, 2021, clarified that after the expiry of lock‐in period of five years, IDFC Limited can exit as the promoter of IDFC First Bank,” it said in a stock exchange filing on Wednesday.

Under RBI rules, the shareholding of the non-operative financial holding company, which is the promoter of the bank, will be locked in for a period of five years from the date of commencement of the business of the bank. IDFC Bank was set up in 2015. This means that the five year lock-in period is now completed.

As on June 30, 2021, IDFC Financial Holding Company held 36.56 per cent stake in IDFC First Bank.

IDFC First Bank was founded by the merger of IDFC Bank and Capital First on December 18, 2018.

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MD, BFSI News, ET BFSI

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Private sector IDFC FIRST Bank is offering compensation equivalent to four times of the CTC as well as continuation of salary for two years to the families of the employees who lost their lives due to the coronavirus infection.

Among others, the bank is also offering loan waivers of such employees so that their families do not feel pressured due to the economic burden.

“The bank’s employees are usually young people. Their families will be taken by shock. So we put together a composite programme covering all angles. We are giving four times the annual CTC as compensation plus continuing the salary for two more years so that the family can get the time to economically recover,” V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, told PTI.

The bank is taking initiative to contact the families of those deceased and informing them about what the bank has to offer to them, he added.

“Among others, as part of this scheme we are waiving employee loans as families will have to bear the burden otherwise. If an employee has taken a personal loan, car loan, two-wheeler loan or education loan, etc, that is 100 per cent waived by the bank. Housing loan waiver is up to Rs 25 lakh (before June 30, 2021),” Vaidyanathan said.

Suppose, if an employee had taken Rs 30 lakh loan, IDFC FIRST will waive Rs 25 lakh and residual loan will become 5 lakh, he explained.

“The family can pay the reduced EMI from the salary credits we will make to them for 2 years. We are asking employees to insure their loans going forward (after June),” he said.

Vaidyanathan said around 20 employees of the bank have lost their lives to Covid.

“We are reaching out to the families of the deceased employees and telling them that you are entitled to this. We will give employment to the spouse if they are eligible on merit, if not then we will give them Rs 2 lakh for skilling them,” he said.

The compensation is applicable retrospectively and will continue as long as the pandemic remains.

Among others under this ‘Employee Covid Care Scheme 2021’, the lender has made provision of scholarship of Rs 10,000 monthly to two children up to graduation, funeral expenses up to Rs 30,000, relocation assistance of Rs 50,000 as well as pro-rata bonus payout for the period served this year by the deceased employee.

Apart from this, Vaidyanathan said the bank employees have taken an initiative on their own to help the needy customers belonging to the low income group by generating a corpus from their salaries.

Under this employee funded Ghar Ghar Ration programme, the bank employees will supply ration kits to 50,000 low income customers whose livelihood has been impacted by the pandemic.

Employees are procuring ration kits comprising 10 kg rice/flour, 2 kg lentils, 1 kg sugar and salt, 1 kg cooking oil, 5 packets of spices, tea, biscuits and other essentials, he said, adding employees have contributed one day to one month’s salary for this.

He said as many as 16,000 benefits have reached across Rajasthan, MP, Maharashtra, Odisha, Gujarat, Karnataka, Haryana, Tamil Nadu, Andhra Pradesh and Chhattisgarh under this programme launched recently.

The lender has also identified 250 vulnerable families who have lost an earning member of their family to Covid-19 with a cash relief support of Rs 10,000 in a partnership with ‘Give India’.



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