Q4 loss at Rs60cr; plans to open 103 branches this year
THRISSUR: The Thrissur-headquartered CSB Bank (formerly Catholic Syrian Bank), has broken the streak of continuous losses this time to post net profit of Rs12.72 crore for 2019-20 against a net loss of Rs197.42 a year ago.
The fourth quarter (Q4) however closed with a net loss of Rs59.68 crore. The CSB Bank share closed at Rs140.20 on NSE on Monday, thus proving to be the only Kerala-based bank currently trading above its book value (BV), which is Rs104.48.
The bank with a current network of 411 branches said it plans to open 103 new branches in this financial year, and the management is confident that 75 per cent of these branches will break even during the first year of their operation.
In fact, the new avatar of CSB Bank with Fairfax as the largest single shareholder with close to 50 per cent stake, has decided to follow a conservative path right from last year by conserving a lot for the future.
If not for the one-time hit of Rs87 crore on its profit & loss (P&L) account on account of switching over to lower tax rates, the bank could have finished the year with a respectable net profit of Rs100 crore as demonstrated by the bank.
“Due to the re-measurement of double taxation agreement (DTA) and reversal of minimum alternate tax (MAT) credit, there is a one-time impact on P&L amounting to Rs 87 crore. The intended benefit by not booking the amount as profit this fiscal will accrue to the bank in the following quarters by way of lower tax rates,” the bank explained in its statement.
C VR Rajendran (seen in the picture) , the managing director & CEO of the bank, said FY20 has been a landmark year in the history of the bank as the bank got listed and has come back to profitability after many years of continuous losses.
“Several positives can be seen in our working results of FY 2020 and we are on a firm pedestal for future growth. Our main aim would be to carefully build a stable asset base in the current environment of heightened VUCA (Volatility, Uncertainty, Complexity, Ambiguity) while diversifying our funding base, cutting costs and improving upon margins and fee income,” Rajendran added.
The bank has built a stable base with a strong capital translating into a capital adequacy ratio (CAR) of 22.46 per cent and a provision coverage ratio (PCR) of 80.12 per cent, which is considered to be exemplary compared with that of its peers.
The bank with a total asset base of Rs18,864.24 crore as of March end, 2020, has brought down its NPAs considerably over the more- than-one-year period.
While the gross NPA has improved from 4.87 per cent to 3.94 per cent, the net NPA has declined from 2.27 per cent to 1.91 per cent over the past one year alone.
During the year, the bank raised capital of Rs409.68 crore through initial public offering (IPO) of 2.10 crore equity shares of Rs10 each at a price of Rs195 per share comprising a fresh issue of 12.31 lakh equity shares aggregating about Rs 24 crore and an offer for sale (OFS) of 1.98 crore equity shares aggregating Rs385.68 crore.