Bank Performance Analysis

PROFITABILITY ANALYSIS
Mar-16 Mar-17

Rs in Crore Rs in Crore
1 Total Assets 1,43,067.96 1,78,859.69
2 Earning Assets
Balances with RBI 4,521.04 7,748.75
Balances with Banks in Deposit Accounts
Balances with Banks & money at Call & Short Notice 5,590.83 10,879.00
Balances with Banks Outside India
Investments + 31,214.31 36,702.14
Advances + 88,419.34 113,080.51
Total Earning Assets 129,745.52 168,410.40
3 Interest bearing Liabilities
Saving Deposits 17,246.25 27,037.23
Term & Other Deposits 75,754.10 99,534.99
Borrowings 22,155.86 22,453.69
Subordinated Debt 308.90 1,000.00
Total Interest bearing liabilities 115,465.11 150,025.91

Equity Capital 594.99 598.15

Reserves 17,101.00 20,047.97
Total Equity 17,695.99 20,646.12
5 Interest Income 11,871.75 14,405.67
6 Interest Expenditure 7,355.18 8,343.07
10 Non-interest operating income 79.82 79.41
11 Non-interest operating Expenditure 3,542.91 4,626.19
12 Provisions and Contingencies 1825 2552
Provisions and Contingencies include provision for tax
Profit After tax 2286 2868

Profitability Ratios
Return on Assets= NI/ TA #VALUE! #VALUE!
Equity Multiplier TA/ TE #VALUE! #VALUE!
TE/ TA #VALUE! #VALUE!
ROE=ROA X EM #VALUE! #VALUE!

NI/ OR 0.31 0.34

OR/ TA #VALUE! #VALUE!
TA/ TE #VALUE! #VALUE!

(II - IE)/ TA #VALUE! #VALUE!

(OI-OE)/ TA #VALUE! #VALUE!
Provisions/TA #VALUE! #VALUE!
ROA #VALUE! #VALUE!
(II- IE)/E A 3.48% 3.60%
EA/ TA #VALUE! #VALUE!
(II - IE)/ TA #VALUE! #VALUE!

NIM
II/ EA 9.15% 8.55%
IE/ Intt Bearing Liab 0.43 0.31
Intt Bearing Liabilities/ EA 0.13 0.16
Spread 4,516.57 6,062.60

Efficiency ratio= Non intt exp/ (Net Interest Income+Non intt income) 30% 32%

Risk Ratios
Liquidity Risk= Short term securities/ Deposits 0.34 0.29
Interest Rate Risk = Interest Sensitive Assets/ Interest Sensitive Liabilities 0.77 0.75
Credit Risk = Provisioning / Assets #VALUE! #VALUE!
Capital Risk = Capital / Assets #VALUE! #VALUE!
Leverage ratio= Total equity/Total assets #VALUE! #VALUE!
Total capital ratio= (Total equity + Long-term debt + Reserve for loan
losses)/Total assets #VALUE! #VALUE!
Provision for loan loss ratio= PLL/ TL (provision for loan losses/total loans and
leases) 0.02 0.02
Loan Ratio = Net loans/ Total assets #VALUE! #VALUE!
Loss Ratio = Net charge-offs on loans (gross charge-offs minus recoveries)/
Total loans and leases

Reserve Ratio = Reserve for loan losses (reserve for loan losses last year minus
gross charge-offs plus PLL and recoveries)/Total loans and leases
0.08 0.11

Nonperforming ratio= Nonperforming assets (nonaccrual loans and restructured

loans)/Total loans and leases

Operating efficiency (cost control)= Wages and salaries/Total expenses

0.32 0.35

Volatile liability dependency ratio= (Total volatile liabilities - Temporary

investments)/Net loans and leases 0.31 0.33

Other Financial Ratios

Tax rate = Total taxes paid/Net income before taxes 0.5173 0.5202
Gap ratio = (Interest rate-sensitive assets – Interest rate-sensitive liabilities)/
Total assets
Conclusion:

On comparing with the peers, the bank shows a highest ROCE on the last 5years average. The profits of the bank are also showing a good sign as th
NIM of the bank for Q3FY2020 is 4.15% which is said to be good. The ROA and ROE has substantially decreased on quarterly basis for the FY202
 Analysis and comments
Mar-18 Mar-19 Mar-20

Rs in Crore Rs in Crore Rs in Crore

2,21,895.69 2,78,180.67 3,07,347.92

10,962.41 9,961.17 13,675.25

2,253.47 4,822.23 2,328.40

50,076.72 59,266.17 59,979.94

144,953.66 186,393.50 206,783.17
208,246.26 260,443.07 282,766.76

45,888.27 54,485.67 53,129.83

105,750.90 29,584.48 28,440.01
38,289.08 47,321.12 60,753.55
2,000.00 3,489.90 3,489.90
191,928.25 134,881.17 145,813.29

600.22 602.69 693.54

23,241.42 26,083.29 33,339.13
23,841.64 26,685.98 34,032.67
17,280.76 22,261.15 28,782.83
9,783.31 13,414.97 16,724.09
63.03 100.16 193.32
5,400.28 6,231.28 8,067.52
2929 4614 5880

3606 3301 4418

#VALUE! #VALUE! #VALUE! In this case we can see that ROA is stagnant in first but declining in the last two years. The ROA figure gives in
#VALUE! #VALUE! #VALUE! The Equity Multiplier is having a stable growth through the years. Generally, a high equity multiplier indicates
#VALUE! #VALUE! #VALUE! There is slight decline in proprietary ratio throughout the years. This ratio is the proportion of shareholders' equ
#VALUE! #VALUE! #VALUE! ROE is a measure of efficiency. Here it can be seen that there has been fluctuation in the trend but declining in

0.37 0.24 0.26 Net Profit Margin Ratio indicates the proportion of sales revenue that translates into net profit. Since, in this cas
#VALUE! #VALUE! #VALUE! The asset utilization ratio, in this case is having a declining trend. This calculates the total revenue earned for ev
#VALUE! #VALUE! #VALUE!

#VALUE! #VALUE! #VALUE!

#VALUE! #VALUE! #VALUE!
#VALUE! #VALUE! #VALUE!
#VALUE! #VALUE! #VALUE!
 3.60% 3.40% 4.26% Net Interest Margin indicates the profitability of a bank by comparing the net interest income it generates from
#VALUE! #VALUE! #VALUE! This ratio analyses what percentage of the bank's assets are creating wealth. Tha ratio has been decreasing from
#VALUE! #VALUE! #VALUE!

8.30% 8.55% 10.18%

0.21 0.25 0.31
0.22 0.21 0.19
7,497.45 8,846.18 12,058.74

31% 28% 28% This ratio tells how well the overheads expenses are being take care of. The effeciency ratio under 50% is consi

0.33 0.70 0.74

0.76 1.38 1.42
#VALUE! #VALUE! #VALUE! Credit risks are used by investors to find out company's risk level and whether they should invest in the shares o
#VALUE! #VALUE! #VALUE! This ratio measures bank's financial stability by measuring it's capital and risk. The minimum capital to asset rat
#VALUE! #VALUE! #VALUE!

#VALUE! #VALUE! #VALUE!

0.02 0.02 0.03

#VALUE! #VALUE! #VALUE!

0.07 0.09 0.09 This ratio gives the indication about the money which is kept aside to recover bad loans in the future. IndusInd's

0.35 0.32 0.32 The Operating efficiency ratio is stable in the past 5 years, which implies that there is efficiency

0.32 -0.28 -0.29 This ratio gives an indication of the extent to which “hot” money is being used to fund the riskiest assets of the

0.5199 0.5088 0.3854

s of the bank are also showing a good sign as there is an increase in the profits over 5years. The
ally decreased on quarterly basis for the FY2020 which is a matter of concern.
wo years. The ROA figure gives investors an idea of how effective the company is in converting the money it invests into net income. The lesser the ROA number, the harder, because the com
a high equity multiplier indicates that a company is using a high amount of debt to finance assets. A low equity multiplier means that the company has less reliance on debt.
he proportion of shareholders' equity to total assets, and as such provides a rough estimate of the amount of capitalization currently used to support a business
ation in the trend but declining in the end. A declining ROE suggests that a company is unable to increase its profit generation even with sufficient capital.

tes into net profit. Since, in this case we are witnessing a declining trend, we can say that very
ates the total revenue earned for every unit (unit of currency) of assets a company owns. Thus, a decreasing asset utilization means the company is being less efficient with each of unit (unit of
 interest income it generates from credit products like loans, mortgages, with the related interest being paid to the holders of savings accounts and certificates of deposits. It indicates the financ
Tha ratio has been decreasing from 2016 to 2020 but the IndusInd Bank still can be said to be using its assets effeciently and has a passive income generation.

effeciency ratio under 50% is considered optimal. If it increases, it means that either expenses are increasing or revenues are decreasing. The Effeciency ratio has remained same in both 2019 a

r they should invest in the shares of this bank or not. An ideal credit risk ratio is less than 35% and here in all the years it is less than that and hence, one can invest in IndusInd Bank.
k. The minimum capital to asset ratio is 8% under BASEL Norm and anything above it indicates that the capital is more than the minimum requirement for daily transactions to take place, in In

r bad loans in the future. IndusInd's Reserve ratio has increased in the previous 2 years, which was due to Bank's positivity regarding the decreased Bad Loans.

t there is efficiency

d to fund the riskiest assets of the bank.Volatile Liabilities have decreased during the period of 5 years,which implies that the Bank's vulnerability is also decreasing to risk of bad loans as well
er the ROA number, the harder, because the company is Unable to earn more money without or with sufficient investment.
pany has less reliance on debt.

ny is being less efficient with each of unit (unit of currency) of asset it has.
and certificates of deposits. It indicates the financial stability of the bank. The NIM of IndusInd Bank has been growing in the last year which shows that the bank made good decisions and was

ffeciency ratio has remained same in both 2019 and 2020. The ratio is much below 50% which shows that the bank has been managing its overheads expenses properly.

hence, one can invest in IndusInd Bank.

uirement for daily transactions to take place, in IndusInd Bank it is less which indicates that the bank does not have minimum money required to carry out it's operations.

ility is also decreasing to risk of bad loans as well as hot money is also decreasing with the bank.
shows that the bank made good decisions and was profitable on its investments.

rheads expenses properly.

to carry out it's operations.

Indusind Bank Ltd.
Balance Sheet Summary : Mar 2016 - Mar 2020 : Non-Annualised : Rs. Crore
Mar-16 Mar-17 Mar-18 Mar-19
12 mths 12 mths 12 mths 12 mths
IGAAP IGAAP IGAAP IGAAP
-
Total liabilities 1,43,067.96 1,78,859.69 2,21,895.69 2,78,180.67

Total Capital 594.99 598.15 600.22 602.69

Paid up equity capital 594.99 598.15 600.22 602.69
Paid up preference capital

Share appln money & suspense account

Reserves and funds 17,101.00 20,047.97 23,241.42 26,083.29

Free reserves 5,014.81 7,119.74 9,312.85 11,108.30
General reserves 1.36 1.36 1.36 1.36
Balance as per profit & loss account 5,013.45 7,118.38 9,311.49 11,106.94
Specific reserves 11,705.42 12,553.64 13,566.37 14,649.44
Security premium reserves (net of deductions) 9,274.11 9,369.42 9,471.15 9,572.92
Capital reserves (incl grants and subsidies) 170.21 215.75 223.37 262.9
Capital redemption reserves
Debenture and bond redemption reserves

Deposits (accepted by commercial banks) 93,000.35 1,26,572.22 1,51,639.17 1,94,867.92

Demand deposits 15,478.02 19,608.81 20,840.98 29,584.48
Saving deposits 17,246.25 27,037.23 45,888.27 54,485.67
Term deposits 60,276.08 79,926.18 84,909.92 1,10,797.77

Borrowings 24,995.86 22,453.70 38,289.09 47,321.13

From banks 4,769.69 2,367.49 757.68 1,715.55
From financial institutions 14,622.75 13,500.00 21,474.03 20,468.74
Syndicated across banks & institutions
Debentures and bonds 500 2,000.00 2,000.00 2,000.00
Foreign currency borrowings 1,954.52 3,586.21 12,057.38 19,646.94
Sub-ordinated debt 308.9 1,000.00 2,000.00 3,489.90
Borrowings from rbi 2,840.00

Deferred tax liability 170.96 211.28 269.52 361.23

Current liabilities & provisions 7,204.80 8,976.37 7,856.27 8,944.41

Current liabilities 6,426.86 8,976.37 7,856.27 8,944.41
Provisions outstanding 777.94

Total assets 1,43,067.96 1,78,859.69 2,21,895.69 2,78,180.67

Net fixed assets 1,217.85 1,306.79 1,313.31 1,688.06

Intangible assets, net 127.96 84.06 129.21 151.95
Land and buildings, net 523.3 511.63 493.49 782.93
Plant, machinery, computers & electrical assets, net
 Capital work-in-progress 37.48 28.44 25.44 21.95

Net pre-operative exp pending allocation

Investments 34,054.32 36,702.14 50,076.72 59,266.17

Investment in equity shares 41.33 161.25 291.94 129.37
Investment in debt instruments 29,920.93 33,976.91 44,842.41 53,934.80
Investment in approved securities (slr & oth stat req)

Deferred tax assets 333.89 563.75 647.32 1,032.32

Current assets 18,548.09 26,491.37 24,060.16 28,537.78

Cash and bank balance 10,111.87 18,628.25 13,215.88 14,783.40
Inventories 0.39 1.54 0.57 0.52
Receivables 8,435.83 7,861.58 10,843.71 13,753.86

Loans and advances by finance companies 88,419.35 1,13,080.51 1,44,953.65 1,86,393.50

Total unamortised expenses

Addendum Information
Net fixed assets net of reval 837.08 932.2 951.11 1,362.51
Tangible net worth 17,187.26 20,187.47 23,350.23 26,208.48
Total outside liabilities 32,371.62 31,641.35 46,414.88 56,626.77
 Mar-20
12 mths
IGAAP

3,07,347.92

1,367.36
693.54

33,339.13
13,491.99
8.33
13,483.66
19,527.57
12,426.09
427.03

2,02,039.81
28,440.01
53,129.83
1,20,469.97

60,753.55
6,140.36
27,214.87

2,000.00
21,393.42
3,489.90
515

290.37

9,557.70
9,557.70

3,07,347.92

1,742.11
170.71
769.58
 78.01

59,979.94
661.37
55,434.13

1,233.76

36,020.22
16,003.65
0.81
20,015.76

2,06,783.16

1,422.54
34,216.21
70,601.62
Indusind Bank Ltd.
Income & Expenditure Summary : Mar 2016 - Mar 2020 : Non-Annualised : Rs. Crore
Mar-16 Mar-17 Mar-18
12 mths 12 mths 12 mths
IGAAP IGAAP IGAAP
-
Total income 15,168.71 18,577.17 22,030.87
Income from financial services 15,088.89 18,497.76 21,967.84
Interest income 11,871.75 14,405.67 17,280.76
Dividends 3.4 0.31 0.3
Income from treasury operations 982.26 1,196.44 1,284.80
Other income 72.83 76.26 55.02
Prior period and extraordinary income 6.99 3.15 8.01

Total expenses 12,882.26 15,709.28 18,424.88

Operating Expenses 10,900.28 12,966.81 15,283.99
Fee based financial services expenses
Fund based financial services expenses 7,384.69 8,374.43 9,904.18
Interest expenses 7,355.18 8,343.07 9,783.31
Treasury operations expenses 29.51 31.36 120.87
Compensation to employees 1,236.09 1,521.02 1,780.69
Indirect taxes
Rent & lease rent 271.33 326.56 373.02
Repairs & maintenance 201.67 255.15 341.82
Insurance premium paid 103.35 137.57 167.8
Outsourced professional jobs 380.59 425.77 491.9
Non-executive directors' fees 1.31 2.72 2.79
Selling & distribution expenses 21.02 50.34 32.55
Travel expenses
Communications expenses 111.01 134.78 130.51
Printing & stationery expenses 49.46 63.07 65.72
Miscellaneous expenditure 1,167.08 1,709.21 2,013.48

Non-Cash Charges 799.17 1,250.68 1,266.20

Provisions 642.65 1,059.98 1,054.56
Depreciation 156.52 190.7 211.64
Amortisation
Write-offs

Prior period and extraordinary expenses

Provision for direct tax 1,182.81 1,491.79 1,874.69

PAT (Profit after tax) 2,286.45 2,867.89 3,605.99

 Mar-19 Mar-20
12 mths 12 mths
IGAAP IGAAP

27,909.04 35,742.74
27,808.88 35,549.42
22,261.15 28,782.83
0.34 0.3
1,474.43 2,151.29
100.16 193.32

24,607.94 31,324.83
19,764.26 25,158.39

13,588.44 17,199.02
13,414.97 16,724.09
173.47 474.93
1,853.51 2,208.48

408.59 468.67
335.63 360.28
194.69 255.56
529.28 663.66
3.68 3.78
40.47 58.05

141.57 149.91
72.72 85.24
2,651.14 3,813.89

3,163.03 4,455.14
2,934.18 4,177.17
228.85 277.97

1.18 8.6

1,679.47 1,702.70

3,301.10 4,417.91
Indusind Bank Ltd.
Profits & its Appropriation : Mar 2016 - Mar 2020 : Non-Annualised : Rs. Crore
Mar-16 Mar-17 Mar-18 Mar-19
12 mths 12 mths 12 mths 12 mths
IGAAP IGAAP IGAAP IGAAP
-
Profits
PBPT net of P&E&OI 4,032.09 5,340.25 6,472.21 7,815.77
Provisions 642.65 1,059.98 1,054.56 2,934.18
For bad & doubtful advances by banks, nbfcs 614.1 704.76 900.9 2,719.01
For diminution in investments 29.51 31.36 120.87 173.47
For unspecified contingencies 28.55 355.22 153.66 215.17

Provision for direct tax 1,182.81 1,491.79 1,874.69 1,679.47

Other income 72.83 76.26 55.02 100.16

Profit after tax net of P&E 2,279.46 2,864.74 3,597.98 3,302.28

Net prior period & extraordinary income 6.99 3.15 8.01 -1.18
Prior period and extraordinary income 6.99 3.15 8.01
Prior period and extraordinary expenses 1.18

PAT (Profit after tax) 2,286.45 2,867.89 3,605.99 3,301.10

Appropriation of PAT
Dividends 292.62 0.46 432.24 542.94
Equity dividend 292.62 0.46 432.24 542.94
Preference dividend
Dividend tax 59.57
Retained profits 1,934.26 2,867.43 3,173.75 2,758.16

Surplus/deficit as at the beginning of the year 3,664.02 5,013.46 7,118.38 9,311.49

Transfer from reserves
Transfer to reserves 584.82 762.51 909.12 979.93
Profit retained/Loss' during the year 1,934.26 2,867.43 3,173.75 2,758.16
Surplus/deficit as at the end of the year 5,013.45 7,118.38 9,311.49 11,106.94

Distribution of PAT (%)

Dividends 12.8 0.02 11.99 16.45
Equity dividend 12.8 0.02 11.99 16.45
Preference dividend 0 0 0 0
Dividend tax 2.61 0 0 0
Retained profits 84.6 99.98 88.01 83.55

Non provisions
For diminution in investment
For sundry debtors
For loans and advances including npas
For loans and advances to group companies
For interest expenses
For power expenses
For gratuity
For others
 Mar-20
12 mths
IGAAP

10,113.06
4,177.17
3,635.29
474.93
541.88

1,702.70

193.32

4,426.51

-8.6

8.6

4,417.91

626.52
626.52

3,791.39

11,106.94
483.86
1,472.39
3,791.39
13,483.66

14.18
14.18
0
0
85.82