Axis Bank Limited · NSE:AXISBANK
Axis Bank — FY2020 Earnings Presentation
57 slides from Axis Bank's earnings presentation, 2020
Slide 1: Investor Presentation Annual Results FY19-20
Investor Presentation Annual Results FY19-20 NSE: AXISBANK BSE: 532215 LSE (GDR): AXB
Slide 2: Major Highlights of Q4FY20 & FY20
Major Highlights of Q4FY20 & FY20 • Deposit book remains resilient and grew by 17% YOY and 8% QOQ, Loan book grew by 15% Growth in deposits continue to drive loan • On QAB basis, CASA + RTD constituting 80%, grew 22% YOY, RTD grew 33% growth • On QAB basis, SA grew by 13% YOY & 3% QOQ, CA grew by 11
Slide 3: Key Metrics for Q4FY20
Key Metrics for Q4FY20 Snapshot (As on 31st March 2020) Deposits# 19% YOY Domestic Advances 15% YOY Absolute (in ` crs) YOY Growth Q4FY20 FY20 Q4FY20 FY20 Net Interest Income 6,808 25,206 19% 16% Fee Income 2,931 11,019 -3% 9% 53% Profit & Operating Expenses 4,942 17,305 17% 9% Loss 80% Operating Pr
Slide 4: Bank's heightened state of preparedness during pre-lockdown stage
The Bank’s heightened state of preparedness during pre-lockdown stage, is now reflecting in its readiness during the post-lockdown days Pre – lockdown measures Post lockdown measures The Bank and its subsidiaries took proactive well before the Covid-19 Activities were reclassified, into Critical 1,
Slide 5: Agenda
Financial Highlights 5 Capital and Liquidity Position 11 Business Segment performance 13 Asset Quality 36 Subsidiaries’ Performance 39 Other important information 49 Annual Results FY19-20 5
Slide 6: Growth in deposits continue to drive loan growth
Growth in deposits continue to drive loan growth Deposits (QAB) ^ Loans All figures in ` Billion 19% YOY 5,501 5,714 15% YOY 5,216 4,948 4,973 6,001 7% 8% 5,470 5,708 8% 7% 7% 5,061 5,301 92% 93% 93% 93% 92% Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Domestic Overseas CASA
Slide 7: Progress on building a granular, stable low cost deposit franchise
Progress on building a granular, stable low cost deposit franchise remains on track SA Balances^ CA Balances All figures in ` Billion 13% 12% 13% 10% 10% 97% 89% 4% 82% 82% 2% 3% 2% 3% 75% 1% YOY 11% YOY 1,568 1,609 1,430 1,475 1,506 893 901 712 688 791 784 743 667 650 697 Mar-19 Jun-19 Sep-19 Dec-1
Slide 8: Operating performance has been steady
Operating performance has been steady All figures in ` Crores Operating Revenue Opex to Average Assets * 17% YOY 10,793 9,998 10,240 9,232 9,712 3,985 3,896 3,787 3,868 13% YOY 2.17% 3,526 $ 2.15% 2.13% 2.09% 6,808 19% YOY 2.08% 5,706 5,844 6,102 6,453 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 FY16 FY17 FY
Slide 9: Net Interest Margin
Net Interest Margin Advances mix by rate type Cost of Funds 6% 6% MCLR Duration Split 9% (Mar-20) 5.69% 5.70% 5.62% 5.44% 5.42% 26% 1M 5.20% 4% 12M, 17% 3M, 11% 52% 6M, 21% Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 MCLR linked Fixed Foreign currency- floating Base Rate linked Repo linked Net interes
Slide 10: Retail is the largest contributor to Bank's fee income
Retail is the largest contributor to Bank’s fee income Overall Fee* Mix Retail Fee Mix All figures in ` Crores MF & Insurance Distribution 19% Cards Wholesale Retail 39% 36% 64% Other Retail Assets, Liabilities & Forex business 42% 1,829 1,861 1,869 1,651 1,704 2% YOY • Retail fee growth was modest
Slide 11: Agenda
Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Subsidiaries’ Performance Other important information Annual Results FY19-20 11
Slide 12: Well capitalised franchise with adequate liquidity
Well capitalised franchise with adequate liquidity Bank’s Capital Adequacy Ratio is at historical highs Liquidity Coverage Ratio 17.53% 15.80% 17.00% 16.07% 16.57% 15.84% (consolidated) 15.09% 15.29% 14.95% 4.19% 13.66% 4.77% 3.45% 4.89% 4.62% 12.65% 3.02% 2.81% 4.57% 135% 3.82% 13.34% 4.21% 12.62%
Slide 13: Agenda
Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Subsidiaries’ Performance Other important information Annual Results FY19-20 13
Slide 14: Business Performance: Retail
Business Performance Retail
Slide 15: Retail book diversified, largely secured, high ETB and salaried share
Retail book has diversified over the years, is largely secured with significantly high proportion of ETB and Salaried customers 80% of our Retail book is secured 3% 2% 10% 9% 8% 9% 8% 9% 6% 12% 1% Key insights - Consumer portfolio 2% 2% 3% 3% 4% 2% 3% 4% 6% 4% 5% 7% 7% 8% 8% 5% 100% of consumer loan
Slide 16: New COVID-19 measures in risk management framework
We have added new COVID-19 measures in each of our tool box within risk management framework to manage risk appropriately Choice of business Portfolio Choice ― Enhanced Business Mix Control ― Customer type (ETB/ NTB) ― Channel (Branch / DSA/ Alternate) Key focus area: Originate retail loans COVID Re
Slide 17: Strong Data Analytics capabilities to proactively manage Risks
Strong Data Analytics capabilities to proactively manage Risks Audio Decisions Businesses generate large amounts of Data Assets continuously Strategic, Business, Policy Decisions are made all the time Images Unstructured Data text ANALYTICS Video Structured Bank data 300+ member dedicated analytics
Slide 18: 4th largest in Credit Cards business
We are the 4th largest in Credit Cards business in the country Featured Cards Credit Cards in Force – Market Share Key insights 12.0% 12.7% 12.2% 11.2% 9.8% 8.2% 7.2% 5.6% • More than 70% of sourcing is to Co-branded Cards Pre Approved customers • Extensive use of data analytics to Mar-13 Mar-14 Mar
Slide 19: Over 61,000 crores of card spends in Q4FY20
Over `61,000* crores of card spends went through Axis Bank in Q4FY20 Credit Cards Debit Cards Spends in quarter (` Cr) 10% YOY Spends in quarter (` Cr) 3% YOY 20,556 14,021 19,181 18,633 18,321 12,767 12,672 11,653 12,056 16,580 17% YOY 24.5 24.5 24.1 24.3 7.0 23.0 6.6 6.8 6.2 6.0 Q4FY19 Q1FY20 Q2FY
Slide 20: Leading player in India's Wealth Management space
The Bank is a leading player in India’s Wealth Management space Overall* Burgundy Performance (Apr’14 - Mar’20) AUM^ 28% Customer Base 28% Fee Revenue~ 38% Touch Points 14% • Overall AUM `147,002 Crores (RMs & Ics) • Burgundy Private AUM ` 17,700 Crores *Includes Burgundy Private ^CAGR is for 4 yrs
Slide 21: Steadily increasing the branch network
We have been steadily increasing the network, but we may delay the expansion in near term Domestic Branch Network* 4,528 4,050 3,703 We have opened 478 branches in FY20, highest number of 3,304 branches in any given year 2,904 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Very well distributed branch presence
Slide 22: Business Performance: Corporate
Business Performance Corporate
Slide 23: Relationship led wholesale franchise driving synergies across One Axis
Strong relationship led wholesale franchise driving synergies across One Axis Entities ‘One stop shop’ for Banking needs of Indian Corporates Investment Banking / Capital Markets 1 • Debt Capital Markets (DCM) • Equity Capital Markets (ECM) Axis Capital We have re-oriented Coverage • M&A & Advisory
Slide 24: Better rated originations and focus on short term loans
…with better rated originations and focussed on short term loans Corporate Loans 83% of the book is rated A- or better 2,04,103 1,83,402 21% 18% 17% 1,74,446 29,015 27,980 41,855 1,75,087 79% 82% 83% 1,55,421 1,32,591 Mar-18 Mar-19 Mar-20 Mar-18 Mar-19 Mar-20 Overseas Domestic A- or better BBB and b
Slide 25: Well placed to benefit from vibrant Corporate Bond market
We remain well placed to benefit from a vibrant Corporate Bond market All figures in ` Crores Placement & Syndication of Debt Issues* Movement in Corporate Bonds Transaction value Market share and Rank* 45,000 24% 40,169 1,08,541 27% YOY 1st 1st 40,000 22% 35,000 22% 20% 78,724 29,296 29,396 30,000
Slide 26: Digital leadership driving transaction banking opportunities
Digital leadership and innovations continue to drive transaction banking opportunities Market Share across Payment channels CMS Throughput (` Trillion) 11% YOY 115 10.9% * 102 10.1% 87 9.0% 68 6.0% 5.8% 6.2% 44 GST Payments RTGS Volume NEFT Volume FY16 FY17 FY18 FY19 FY20 Mar-19 Mar-20 *NEFT data is
Slide 27: Industry-wise Distribution (Top 10)
Industry-wise Distribution (Top 10) All figures in ` Crores Outstanding1 as on 31st Mar ’20 Total Non-fund Rank Advances Investments based Sectors Value (in % terms) 1. Financial Companies2 43,174 9,747 11,206 64,127 9.21% 2. Engineering & Electronics 11,414 120 26,664 38,198 5.49% 3. Infrastructure
Slide 28: Business Performance: Commercial
Business Performance Commercial
Slide 29: 85% of SME book is secured
85% of SME book is secured and predominantly working capital financing All figures in ` Crores SME book mix (by type) SME book mix (by tenure) 19% 15% 21% 22% 81% 85% 79% 78% Mar-19 Mar-20 Mar-19 Mar-20 Secured Unsecured Short term loan Long term loan 85% of book is rated SME3 or better Incremental
Slide 30: SME lending book well diversified
SME lending book is well diversified across sectors and geography Segment Mix Book by Loan size Well diversified Geographical mix Well diversified Sectoral mix 13% 15% 15% 17% 2% 18% 3% 17% 35% 4% 10% 4% 35% 18% 17% 4% 27% 4% 10% 50% 15% 5% 20% 7% 16% 5% 7% 7% Trade Retail & Wholesale SEG MEG SCF Le
Slide 31: Business Performance: Digital
Business Performance Digital
Slide 32: Strong market position across Digital Payment products
We have strong market position across most Digital Payment products Axis Bank market position across products Product Debit Point of Sale Credit Mobile UPI4 Forex Cards1 Terminals ^ Cards2 Banking3 Cards5 Market share 7% 12% 10% 10% 15% 23% Ranking 4th 4th 3rd 4th 3rd Source: RBI, Internal Data 1 –
Slide 33: Digital Channels central to most activities
Digital Channels are becoming central to most activities in the Bank 84% of all financial Digital Sourcing in Liabilities & transactions^ were digital Digital sourcing of Assets Investment products Branches, 4% • 74% of Savings Accounts were sourced • 48% of Personal loans* sourced through ATM, thro
Slide 34: Mobile Banking transactions continue to grow strongly
Mobile Banking transactions continue to grow strongly 45% of Mobile Banking customers bank only on Mobile App Mobile Banking logins stand at 11.9 times of Internet Banking logins, 230+ DIY services are available on Axis Mobile and Internet Banking Axis Aha! answered over 4 million messages in Q4FY20
Slide 35: UPI has scaled up tremendously
UPI has scaled up tremendously to become a key channel for customer transactions Axis Bank’s UPI Growth 1 92 mn VPAs created till date 2 Over 2627 mn UPI transactions# story VPA base and Quarterly Transaction Volume (As Payer PSP) UPI transaction value (as Payer PSP) (in ` Crores) 179% YOY 109% YOY
Slide 36: Agenda
Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Subsidiaries’ Performance Other important information Annual Results FY19-20 36
Slide 37: BB & Below Corporate Book and Segmental NPA
BB & Below Corporate Book and Segmental NPA All figures in ` Crores Bank’s Net NPA and Fund based BB and Below* portfolio Retail SME Corporate PCR (excluding technical writeoffs) has improved from 60% to 69% QoQ; net NPA declined 53 bps QoQ 55%^ 52%^ 9.32% 74%^ 69% 62% 62% 62% 60% 5.77% 4.0 0% 3.4%
Slide 38: Detailed walk of NPAs over recent quarters
Detailed walk of NPAs over recent quarters All figures in ` Crores Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Gross NPAs - Opening balance A 30,855 29,789 29,405 29,071 30,073 Fresh slippages B 3,012 4,798 4,983 6,214 3,920 Upgradations & Recoveries C 2,376 2,177 2,213 2,422 2,489 Write offs D 1,701 3,005 3
Slide 39: Agenda
Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Subsidiaries’ Performance Other important information Annual Results FY19-20 39
Slide 40: Subsidiaries' contribution to overall profitability
Bank’s subsidiaries contribution to the overall profitability All figures in ` Crores Subsidiary Investments Bank’s Investments PAT Growth profit as % of Subsidiary made as % of FY20 Profit ** stake (%) made (in %YOY) consolidated Bank’s Networth profit Axis Capital 100% 73.50 0.10% 100.17 58% 5.41%
Slide 41: Axis Finance: Strong profitability, cautious growth
Axis Finance : Strong profitability, being cautious with growth All figures in ` Crores Growth in Loan Book Major Highlights (FY20) 30% CAGR* NIM for FY20 stood at 4.9%; 8,040 7,704 ROE was 15.2% 6,624 Total CAR at 23.1% 4,292 3,104 Net NPA ratio of 1.9% as of March 31st, 2020. 2,095 Enjoy
Slide 42: Axis AMC: Strong performance
Axis AMC : Strong performance under current market conditions All figures in ` Crores Average AUM has shown strong growth 39% YOY 1,17,254 84,544 70,902 48,829 33,163 23,483 FY15 FY16 FY17 FY18 FY19 FY20 Trend in PAT Major Highlights 121% YOY Total Gross revenue of `478 Cr earned during FY20 121
Slide 43: Axis Securities: Broking revenue growth slowed
Axis Securities : Growth in broking revenue has slowed Total customer base (in mn) 8% YOY Major Highlights – FY20 2.27 2.10 Has one of the highest mobile adoption rates in the 1.84 industry with over 74% volumes coming from Mobile in 1.39 FY20 1.00 40% of clients traded through Axis Mobile App 0
Slide 44: Axis Capital: Leadership position maintained
Axis Capital : Leadership position maintained in volatile capital markets All figures in ` Crores FY20 Ranking* based on IPO, QIP, Rights, OFS & IPP Major Highlights Rank Banker No of deals 1 Axis Capital 17 Ranked No 1 in Equity and Equity Linked Deals over the last decade 2 Peer 1 11 Successfu
Slide 45: A.TReDs: Invoicemart market leader
A.TReDs: The Invoicemart product continues to be a market leader Axis Bank is one of the three entities allowed by RBI to set up the Trade Receivables Discounting System (TReDS), an electronic platform for facilitating cash flows for MSMEs TReDS is an electronic platform that connects MSME sellers w
Slide 46: Freecharge: Top non-bank financial services platform
Freecharge: Among the top non-bank financial services platforms in the industry with a significant consumer franchise footprint One of the top financial services App in India … With massive potential for cross selling Bank products Registered with FreeCharge 79 MN Ever transacted on FreeCharge 41 MN
Slide 47: Evolving from Digital payments to Digital Financial Services
Business is now focused on evolving from a leading Digital payments platform to a Digital Financial Services platform by offering new services DIGITAL PAYMENTS DIGITAL FINANCIAL SERVICES MOBILE FC CREDITLINE RECHARGES DTH, UTILITIES FC DEBIT EMI MUTUAL FUND & INVESTMENTS BUS TICKETS DEALS INSURANCE
Slide 48: Axis-MFSL to be a 30:70 JV in Max Life Insurance
Axis-MFSL to be a 30:70 JV in Max Life Insurance Deal Construct Max Life • Fourth largest private life insurer, and largest non- bank private life insurance company • Max Life (“MLI”) to become a 70:30 JV between Max • Axis Bank and MLI have a successful relationship Financial Services (“MFSL”) and
Slide 49: Agenda
Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Subsidiaries’ Performance Other important information Annual Results FY19-20 49
Slide 50: Sustainability at Axis Bank
Sustainability at Axis Bank “Striving to create positive, financial as well as non-financial impact among our diverse stakeholder spectrum across rural and urban India” Green Banking Banking for Emerging India • First certified Green Bond by an Asian Bank, launched in 2016 for US$ 500 mn • 1.7 milli
Slide 51: Differentiated identity, among most valuable Brands in India
We have created a differentiated identity and are amongst the most valuable Brands in India Featured amongst Top 20 most valuable brands in India Axis Bank Mobile App Store Rating 4.6 2018 Global Rank #14 4.7 vs. #32 in 2017 People’s Choice Among 42 leading banks worldwide Annual Results FY19-20 51
Slide 52: Major awards won by the Bank and its subsidiaries
Major awards won by the Bank and its subsidiaries Excellence in Operations Usage of Data Science / AI Anti-Money Laundering – IDC Insights Awards 2019 within Internal Audit in the Technology Implementation BFSI category • Best Contactless Payments Financial Inclusion Initiative Of Project of the Yea
Slide 53: Financial Performance (INR crores)
Financial Performance Financial Performance ( ` crores) Q4FY20 Q4FY19 % Growth FY20 FY19 % Growth Interest Income A 16,234 14,798 10% 62,635 54,986 14% Other Income B = C+D+E 3,985 3,526 13% 15,537 13,130 18% - Fee Income C 2,931 3,020 (3%) 11,019 10,127 9% - Trading Income D 264 354 (25%) 2,420 971
Slide 54: Financial Performance (USD mn)
Financial Performance Financial Performance ( USD mn) Q4FY20 Q4FY19 % Growth FY20 FY19 % Growth Interest Income A 2,146 1,956 10% 8,278 7,267 14% Other Income B = C+D+E 526 466 13% 2,053 1,735 18% - Fee Income C 387 399 -3% 1,456 1,338 9% - Trading Income D 35 47 -25% 320 128 149% - Miscellaneous In
Slide 55: Balance Sheet
Balance Sheet Balance Sheet (` crores) As on 31st Mar’20 As on 31st Mar’19 As on 31st Mar’20 As on 31st Mar’19 % Growth CAPITAL AND LIABILITIES In ` Crores In ` Crores in $ Mn in $ Mn Capital 564 514 75 68 10% Reserves & Surplus 84,384 66,162 11,152 8,744 28% Deposits 6,40,105 5,48,472 84,597 72,487
Slide 56: Safe Harbor
Safe Harbor Except for the historical information contained herein, statements in this release which contain words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “futu
Slide 57: Thank You
Thank You Annual Results FY19-20 57