REG - Federal Bank Ltd The - 3rd Quarter Results
UNAUDITED STANDALONE AND CONSOLIDATED FINANCIAL RESULTS OF THE FEDERAL BANK LIMITED FOR THE QUARTER AND NINE MONTHS ENDED 31ST DECEMBER, 2020
Varma & Varma Borkar & Muzumdar
Chartered Accountants, Chartered Accountants
No.53/2600, Kerala Varma Tower Anand Nagar, Om Co-op
Off Kunjanbava Road, Hsg Society, Anand Nagar Lane
Vytilla, Off Nehru Road, Santacruz(East)
Kochi -682019 Mumbai - 400 055
Limited Review Report on unaudited standalone financial results of The Federal Bank Limited for the quarter and nine months ended 31st December, 2020, pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
Review Report to
The Board of Directors,
The Federal Bank Limited
1. We have reviewed the accompanying Statement of Unaudited Standalone Financial Results of The Federal Bank Limited ('the Bank') for the quarter and nine months ended 31st December, 2020 ('the Statement') attached herewith, being submitted by the Bank pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (as amended), except for the disclosures relating to Pillar 3 disclosure under Basel III Capital Regulations, as at 31st December, 2020, including Leverage Ratio and Liquidity Coverage Ratio as have been disclosed on the Bank's website and in respect of which a link has been provided in the aforesaid Statement, which have not been reviewed by us.
2. The Statement is the responsibility of the Bank's Management and has been approved by the Bank's Board of Directors. The Statement has been prepared in accordance with the recognition and measurement principles laid down in Accounting Standard -25 'Interim Financial Reporting' ('AS-25'), prescribed under section 133 of the Companies Act, 2013, the relevant provisions of the Banking Regulation Act, 1949, the circulars, guidelines and directions issued by the Reserve Bank of India (the 'RBI') from time to time (the 'RBI Guidelines'), SEBI circular CIR/CFD/FAC/62/2016 dated 5th July, 2016 (hereinafter referred to as the 'SEBI Circular'), and other accounting principles generally accepted in India. Our responsibility is to issue a report on the Statement based on our review.
3. We conducted our review of the statement in accordance with the Standard on Review Engagement (SRE) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Institute of Chartered Accountants of India. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the Statement is free of material misstatement. A review is limited primarily to inquiries of company personnel and analytical procedures applied to financial data and thus provides less assurance than an audit. We have not performed an audit and accordingly, we do not express an audit opinion.
4. Our review primarily is conducted on the basis of review of the books of account and records of the Bank. We have also relied on the information and explanations furnished to us by the Bank and the returns as considered necessary by us for the review.
5. Based on our review conducted as above, nothing has come to our attention that causes us to believe that the accompanying Statement of Unaudited Standalone Financial Results prepared in accordance with applicable accounting standards, the RBI Guidelines, the SEBI circular and other recognized accounting practices and policies has not disclosed the information required to be disclosed in terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended) including the manner in which it is to be disclosed, or that it contains any material misstatement or that it has not been prepared in accordance with the relevant prudential norms issued by the Reserve Bank of India in respect of income recognition, asset classification, provisioning and other related matters.
6. We draw attention to Note No.10 of the accompanying Statement of Unaudited Standalone Financial results, regarding the impact of COVID-19 pandemic, and adjustments made in the accounts for the quarter and nine months ended 31st December, 2020 on account of the same. As stated therein, in view of continuing uncertainties, the extent of impact of the pandemic on the Bank's operations and financial position would depend on various aspects, including actions taken to mitigate its impact and other regulatory measures.
Our conclusion on the Statement is not modified in respect of this matter.
7. The review of unaudited quarterly and nine month financial results for the quarter and nine months ended 31st December 2019 and audit of financial results for the year ended 31st March 2020 included in the Statement were carried out and reported by predecessor auditors who have expressed unmodified conclusion vide review reports dated 20th January, 2020 for the period ended 31st December, 2019 and unmodified opinion vide audit report dated 28th May, 2020, whose reports have been furnished to us and which have been relied upon by us for the purpose of our review of the Statement.
Our conclusion on the Statement is not modified in respect of this matter.
For Varma & Varma For Borkar & Muzumdar
Chartered Accountants Chartered Accountants
FRN:004532S FRN:101569W
R Rajasekharan Devang Vaghani
Partner Partner
M. No. 22703 M. No. 109386
UDIN: 21022703AAAAAB8424 UDIN: 21109386AAAAAW8601
Kochi-19 Mumbai-55
20th January 2021 20th January 2021
THE FEDERAL BANK LIMITED
REGD.OFFICE: P.B.NO. 103, FEDERAL TOWERS, ALUVA-683101
(CIN: L65191KL1931PLC000368)
STANDALONE UNAUDITED FINANCIAL RESULTS FOR THE QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2020
(` in Lakhs)
Particulars
Quarter ended
Nine months ended
Year ended
31.12.2020
30.09.2020
31.12.2019
31.12.2020
31.12.2019
31.03.2020
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
1. Interest earned (a)+(b)+(c)+(d)
345,952
348,790
333,036
1,039,157
981,391
1,321,075
(a)
Interest/discount on advances/bills
271,321
271,749
270,278
813,668
794,652
1,067,087
(b)
Income on investments
57,361
59,252
53,611
177,225
161,878
218,407
(c)
Interest on balances with Reserve Bank of India and other inter bank funds
11,469
11,661
3,527
30,197
9,310
13,996
(d)
Others
5,801
6,128
5,620
18,067
15,551
21,585
2. Other income
48,184
50,933
40,786
147,954
122,030
193,141
3. TOTAL INCOME (1+2)
394,136
399,723
373,822
1,187,111
1,103,421
1,514,216
4. Interest expended
202,248
210,805
217,543
627,824
638,102
856,185
5. Operating expenses (i)+(ii)
95,598
88,265
81,897
269,106
240,781
337,561
(i)
Employees cost
52,564
48,746
41,476
150,895
125,330
177,236
(ii)
Other operating expenses
43,034
39,519
40,421
118,211
115,451
160,325
6. TOTAL EXPENDITURE (4+5)
(excluding provisions and contingencies)297,846
299,070
299,440
896,930
878,883
1,193,746
7. OPERATING PROFIT (3-6)
(Profit before provisions and contingencies)96,290
100,653
74,382
290,181
224,538
320,470
8. Provisions (other than tax) and contingencies
42,062
59,206
16,086
140,730
60,467
117,217
9. Exceptional items
-
-
-
-
-
-
10. Profit from Ordinary Activities before tax
(7-8-9)54,228
41,447
58,296
149,451
164,071
203,253
11. Tax expense
13,818
10,685
14,232
38,202
39,916
48,975
12. Net Profit from Ordinary Activities after tax (10-11)
40,410
30,762
44,064
111,249
124,155
154,278
13. Extraordinary items (net of tax expense)
-
-
-
-
-
-
14. Net Profit for the period (12-13)
40,410
30,762
44,064
111,249
124,155
154,278
15. Paid-up Equity Share Capital
(Face value ` 2/- per Equity Share)39,917
39,893
39,846
39,917
39,846
39,853
16. Reserves excluding Revaluation Reserve
1,411,407
17. Analytical Ratios
(i)
Percentage of shares held by Government of India
NIL
NIL
NIL
NIL
NIL
NIL
(ii)
Capital Adequacy ratio (%)
Under Basel III
14.31
14.64
13.64
14.31
13.64
14.35
(iii)
Earnings per Share (EPS) (in `)
(a) Basic EPS (before and after extra ordinary items)
2.03*
1.54*
2.21*
5.58*
6.25*
7.76
(b) Diluted EPS (before and after extra ordinary items)
2.02*
1.54*
2.20*
5.56*
6.21*
7.70
(iv)
NPA Ratios
a) Gross NPA
347,018
355,219
361,869
347,018
361,869
353,083
b) Net NPA
75,724
121,814
194,101
75,724
194,101
160,717
c) % of Gross NPA
2.71
2.84
2.99
2.71
2.99
2.84
d) % of Net NPA
0.60
0.99
1.63
0.60
1.63
1.31
(v)
Return on Assets (%)
0.21*
0.16*
0.26*
0.60*
0.77*
0.94
* Not Annualised
Segment Information@
(` in Lakhs)
Particulars
Quarter ended
Nine months ended
Year ended
31.12.2020
30.09.2020
31.12.2019
31.12.2020
31.12.2019
31.03.2020
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Segment Revenue:
Treasury
61,868
60,754
42,497
216,404
158,272
226,846
Corporate/Wholesale Banking
104,742
131,976
122,589
352,612
368,790
489,365
Retail Banking
227,526
206,993
208,736
618,095
576,359
798,005
Other Banking operations
-
-
-
-
-
-
Unallocated
-
-
-
-
-
-
Total Revenue
394,136
399,723
373,822
1,187,111
1,103,421
1,514,216
Less: Inter Segment Revenue
-
-
-
-
-
-
Income from Operations
394,136
399,723
373,822
1,187,111
1,103,421
1,514,216
Segment Results (net of provisions):
Treasury
12,234
4,154
1,197
59,016
26,495
41,518
Corporate/Wholesale Banking
(1,994)
15,063
6,386
4,920
35,966
17,058
Retail Banking
43,986
22,230
50,953
85,515
101,850
145,113
Other Banking operations
-
-
-
-
-
-
Unallocated
2
-
(240)
-
(240)
(436)
Profit before tax
54,228
41,447
58,296
149,451
164,071
203,253
Segment Assets
Treasury
4,510,555
4,378,891
3,298,796
4,510,555
3,298,796
3,787,323
Corporate/Wholesale Banking
6,674,295
6,809,139
6,902,969
6,674,295
6,902,969
7,056,243
Retail Banking
7,428,474
6,937,457
6,322,326
7,428,474
6,322,326
6,480,887
Other Banking operations
-
-
-
-
-
-
Unallocated
1,071,333
777,184
754,989
1,071,333
754,989
739,352
Total
19,684,657
18,902,671
17,279,080
19,684,657
17,279,080
18,063,805
Segment Liabilities
Treasury
1,342,363
1,305,303
1,136,410
1,342,363
1,136,410
1,627,269
Corporate/Wholesale Banking
1,494,931
1,405,908
1,040,060
1,494,931
1,040,060
1,258,540
Retail Banking
15,084,901
14,461,623
13,494,733
15,084,901
13,494,733
13,458,149
Other Banking operations
-
-
-
-
-
-
Unallocated
197,972
206,312
186,739
197,972
186,739
268,086
Total
18,120,167
17,379,146
15,857,942
18,120,167
15,857,942
16,612,044
Capital employed:
(Segment Assets - Segment Liabilities)
Treasury
3,168,192
3,073,588
2,162,386
3,168,192
2,162,386
2,160,054
Corporate/Wholesale Banking
5,179,364
5,403,231
5,862,909
5,179,364
5,862,909
5,797,703
Retail Banking
(7,656,427)
(7,524,166)
(7,172,407)
(7,656,427)
(7,172,407)
(6,977,262)
Other Banking operations
-
-
-
-
-
-
Unallocated
873,361
570,872
568,250
873,361
568,250
471,266
Total
1,564,490
1,523,525
1,421,138
1,564,490
1,421,138
1,451,761
@
For the above segment reporting, the reportable segments are identified as Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking Operations in compliance with the RBI guidelines.
Notes:
1
The above Standalone Unaudited Financial Results for the quarter and nine months ended December 31, 2020 were reviewed by the Audit Committee and approved by the Board of Directors at its meeting held on January 20, 2021. These Results have been subjected to "Limited review" by the Statutory Central Auditors of the Bank and an unqualified review report has been issued.
2
The Bank has followed the same significant accounting policies in the preparation of the interim financial results as those followed in the annual financial statements for the year ended March 31, 2020.
3
Pursuant to Board approved policy on preparation of segment information, the Bank, with effect from quarter ended June 30, 2020, has revised the basis of preparation of segment information on a direct identification basis with the aid of Internal Transfer pricing mechanism for more appropriate presentation of the segment results. Accordingly, figures for the previous periods have been regrouped / reclassified to conform to current period's classification.
The change in segment information has no impact on the overall Revenue, Results, and Capital employed of the bank for the quarter and nine months ended December 31, 2020 or the previous periods/year.4
The working results have been arrived at after considering provision for standard assets, including requirements for exposures to entities with Unhedged Foreign Currency Exposures, non-performing assets (NPAs), depreciation on investments, income-tax and other usual and necessary provisions.
5
Other income includes fees earned from providing services to customers, commission from non-fund-based banking activities, earnings from foreign exchange and derivative transactions, selling of third-party products, profit on sale of investments (net), recoveries from advances written off etc.
6
The Capital Adequacy Ratio is computed on the basis of RBI guidelines applicable on the relevant reporting dates and the ratio for the corresponding previous period is not adjusted to consider the impact of subsequent changes if any, in the guidelines.
7
The Business operations of the Bank are largely concentrated in India and for the purpose of Segment reporting, the bank is considered to operate only in domestic segment, though the bank has its operations in International Finance Service Centre (IFSC) Banking Unit in Gujarat International Finance Tec-city (GIFT). The business conducted from the same is considered as part of Indian operations.
8
During the quarter and nine months ended December 31, 2020, the Bank has allotted 1,180,276 and 3,190,661 equity shares of ` 2 each, pursuant to the exercise of stock options by employees.
9
In accordance with RBI Circular DBR.No.BP.BC.1/21.06.201/2015-16 on Basel III Capital Regulations dated July 01, 2015 and RBI Circular DBR.No.BP.BC.80/21.06.201/2014-15 dated March 31, 2015 - 'Prudential Guidelines on Capital Adequacy and Liquidity Standards - Amendments', Banks are required to make Pillar 3 disclosure requirements including Leverage Ratio disclosure requirements that are to be made along with the publication of Financial Results. Accordingly, such applicable disclosures have been placed on the website of the Bank which can be accessed at the following link: http://www.federalbank.co.in/regulatory-disclosures. These disclosures have not been subjected to audit or review by the Statutory Central Auditors of the Bank.
10
On account of uncertainties arising from the COVID-19 pandemic across the world and in India, the extent to which the same will impact the Bank's operations and financial position will depend on various aspects including actions taken to mitigate its impact and other regulatory measures. The Bank's capital and liquidity position is strong and would continue to be the focus area for the Bank during this period.
As per the 'COVID-19 Regulatory Packages' announced by the RBI ('the RBI guidelines'), with regard to providing relief to borrowers' on account of COVID-19 pandemic, whose accounts were standard as on February 29, 2020, the Bank, in accordance with the Board approved policy had offered moratorium on repayment of loan instalments and/or deferment of interest due between March 1, 2020 and August 31, 2020, including relaxation in certain parameters, to all eligible borrowers, without considering the same as restructuring.
The Bank held a provision of ` 58,791.00 Lakhs as on September 30, 2020 against the likely impact of COVID-19, including the RBI mandated provision. During the current quarter, the bank has utilized ` 5,122.00 Lakhs from the above provision for creation of RBI mandated provision for advances restructured under "Resolution framework for COVID-19 related stress". Hence, the aggregate provision against the likely impact of COVID-19, including the RBI mandated provision, stands at ` 53,669.00 Lakhs as on December 31, 2020 and is grouped under 'Other liabilities and provisions' in the Balance sheet of the Bank.
The Honourable Supreme Court in a writ petition by Gajendra Sharma Vs Union of India & Anr vide its interim order dated September 3, 2020 has directed Banks that the accounts which were not declared Non performing asset (NPA) till August 31, 2020 shall not be declared NPA till further orders, pending disposal of the case by Supreme Court. Pursuant to the order, the Bank has not declared any account as NPA, which was not declared as NPA till August 31, 2020 as per the RBI Prudential norms on Income Recognition, Asset classification, and provisioning pertaining to advances. The Bank holds sufficient provisions in respect of these advances and as a prudent measure, the Bank has not recognized the unrealized interest on these accounts as income.11
The figures for the quarter and nine months ended December 31, 2019 and year ended March 31, 2020 were reviewed / audited by previous statutory auditors.
12
Previous period's / year's figures have been regrouped / reclassified, where necessary to conform to current period's classification.
SHYAM SRINIVASAN
Kochi
MANAGING DIRECTOR & CEO
January 20, 2021
(DIN: 02274773)
Varma & Varma Borkar & Muzumdar
Chartered Accountants, Chartered Accountants
No.53/2600, Kerala Varma Tower Anand Nagar, Om Co-op
Off Kunjanbava Road, Hsg Society, Anand Nagar Lane
Vytilla, Off Nehru Road, Santacruz(East)
Kochi -682019 Mumbai - 400 055
Limited Review Report on consolidated unaudited financial results of The Federal Bank Limited for the quarter and nine months ended 31st December 2020, pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
Review Report to
The Board of Directors,
The Federal Bank Limited
8. We have reviewed the accompanying Statement of Unaudited Consolidated Financial Results of The Federal Bank Limited (the 'Bank') and its Subsidiaries (the Bank and its subsidiaries together referred to as 'the Group') and its share of the net profit/loss after tax of its Associates for the quarter and nine months ended 31st December 2020 (the 'Statement'), attached herewith, being submitted by the Bank pursuant to the requirement of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended ('Listing Regulations'), except for the disclosures relating to consolidated Pillar 3 disclosure, as at 31st December 2020, including Leverage Ratio and Liquidity Coverage Ratio under Basel III Capital Regulations as have been disclosed on the Bank's website and in respect of which a link has been provided in the aforesaid Statement, which have not been reviewed by us.
9. The Statement is the responsibility of the Bank's Management and has been approved by the Bank's Board of Directors. The Statement has been prepared in accordance with the recognition and measurement principles laid down in Accounting Standard -25 'Interim Financial Reporting' ('AS-25'), prescribed under section 133 of the Companies Act, 2013, the relevant provisions of the Banking Regulation Act, 1949, the circulars, guidelines and directions issued by the Reserve Bank of India (the 'RBI') from time to time (the 'RBI Guidelines'), SEBI circular CIR/CFD/FAC/62/2016 dated 5th July, 2016 (hereinafter referred to as the 'SEBI Circular'), and other accounting principles generally accepted in India. Our responsibility is to issue a report on the Statement based on our review.
10. We conducted our review of the Statement in accordance with the Standard on Review Engagement (SRE) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Institute of Chartered Accountants of India. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the Statement is free of material misstatement. A review is limited primarily to inquiries of company personnel and analytical procedures applied to financial data and thus provides less assurance than an audit. We have not performed an audit and accordingly, we do not express an audit opinion.
We also performed procedures in accordance with the circular issued by the SEBI under Regulation 33(8) of the Listing Regulations, to the extent applicable.
11. Our review primarily is conducted on the basis of review of the books of account and records of the Bank. We have also relied on the information and explanations furnished to us by the Bank and the returns as considered necessary by us for the review.
12. This Statement includes the results of the following entities:
a. Fedbank Financial Services Limited (Subsidiary)
b. Federal Operations and Services Limited (Subsidiary)
c. IDBI Federal Life Insurance Company Limited (Associate)
d. Equirus Capital Private Limited (Associate)
13. Based on our review conducted and procedures performed as stated in Paragraphs 3 and 4 above and based on the consideration of the review reports of other auditors referred to in Paragraphs 7 and 8 below, nothing has come to our attention that causes us to believe that the accompanying Statement prepared in accordance with applicable accounting standards, the RBI Guidelines, the SEBI circular and other recognized accounting practices and policies has not disclosed the information required to be disclosed in terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended) including the manner in which it is to be disclosed, except for the disclosures relating to consolidated Pillar 3 disclosure, as at 31st December 2020, including Leverage Ratio and Liquidity Coverage Ratio under Basel III Capital Regulations as have been disclosed on the Bank's website and in respect of which a link has been provided in the aforesaid Statement, which have not been reviewed by us, or that it contains any material misstatement.
14. The statement of consolidated unaudited financial results includes the interim financial statements / financial information/ financial results of the two subsidiaries whose unaudited financial results reflects total revenues of Rs. Rs.18,787.82 Lakhs and Rs. Rs.51,728.57 Lakhs and total net profit after tax of Rs. Rs.1,557.70 Lakhs and Rs. Rs.3,799.38 Lakhs for the quarter and nine months ended 31st December 2020 respectively as considered in the consolidated unaudited financial results. These interim financial statements/financial information/ financial results have been reviewed by one of the Joint auditors of the Bank, whose reports have been furnished to us by the Management and our conclusion on the Statement, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, is based solely on their reports and the procedures performed by us as stated in Paragraphs 3 and 4 above.
Our conclusion on the Statement is not modified in respect of this matter.
15. The statement of consolidated unaudited financial results includes the Group's share of net loss after tax of Rs. 15.43 Lakhs and Rs. 64.98 Lakhs for the quarter and nine months ended 31st December, 2020 respectively as considered in the consolidated unaudited financial results in respect of one associate whose interim financial results have not been reviewed by us. These interim financial results have been reviewed by another auditor whose report has been furnished to us by the Management and our conclusion on the Statement, in so far as it relates to the amounts and disclosures included in respect of the said associate, is based solely on the report of the other auditor and the procedures performed by us as stated in Paragraphs 3 and 4 above.
Our conclusion on the Statement is not modified in respect of this matter.
16. The statement of consolidated unaudited financial results also includes the Group's share of net profit after tax of Rs. 256.31 lakhs and Rs. 636.26 lakhs for the quarter and nine months ended 31st December 2020 respectively as considered in the consolidated unaudited financial results in respect of one associate, based on their interim financial results which have not been reviewed/audited. According to the information and explanations given to us by the Management, these interim financial statements / financial information / financial results are not material to the Group.
Our conclusion on the Statement is not modified in respect of this matter.
17. We draw attention to Note No.11 of the accompanying Statement, regarding the impact of COVID-19 pandemic and adjustments made in the accounts for the quarter and nine months ended 31st December, 2020 on account of the same. As stated therein, in view of continuing uncertainties, the extent of impact of the pandemic on the Bank's operations and financial position would depend on various aspects, including actions taken to mitigate its impact and other regulatory measures.
Our conclusion on the Statement is not modified in respect of this matter.
18. The review of unaudited quarterly and nine month financial results for the quarter and nine months ended 31st December 2019 and audit of financial results for the year ended 31st March 2020 included in the Statement were carried out and reported by predecessor auditors who have expressed unmodified conclusion vide review reports dated 20th January, 2020 for the period ended 31st December, 2019 and unmodified opinion vide audit report dated 28th May, 2020, whose reports have been furnished to us and which have been relied upon by us for the purpose of our review of the Statement.
Our conclusion on the Statement is not modified in respect of this matter.
For Varma & Varma For Borkar & Muzumdar
Chartered Accountants Chartered Accountants
FRN:004532S FRN:101569W
R Rajasekharan Devang Vaghani
Partner Partner
M. No. 22703 M. No. 109386
UDIN: 21022703AAAAAC1906 UDIN: 21109386AAAAAX7593
Kochi-19 Mumbai-55
20th January 2021 20th January 2021
THE FEDERAL BANK LIMITED
REGD.OFFICE: P.B.NO. 103, FEDERAL TOWERS, ALUVA-683101
(CIN: L65191KL1931PLC000368)
CONSOLIDATED UNAUDITED FINANCIAL RESULTS FOR THE QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2020
(` in Lakhs)
Particulars
Quarter ended
Nine months ended
Year ended
31.12.2020
30.09.2020
31.12.2019
31.12.2020
31.12.2019
31.03.2020
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
1. Interest earned (a)+(b)+(c)+(d)
360,423
362,188
341,395
1,079,822
1,004,591
1,359,039
(a)
Interest/discount on advances/bills
286,093
285,376
278,601
854,243
817,740
1,104,518
(b)
Income on investments
56,781
59,284
53,647
176,719
161,990
218,550
(c)
Interest on balances with Reserve Bank of India and other inter bank funds
11,469
11,661
3,527
30,197
9,310
13,996
(d)
Others
6,080
5,867
5,620
18,663
15,551
21,975
2. Other income
48,454
50,944
42,076
147,729
120,342
188,181
3. TOTAL INCOME (1+2)
408,877
413,132
383,471
1,227,551
1,124,933
1,547,220
4. Interest expended
207,579
215,941
220,564
643,175
645,694
867,831
5. Operating expenses (i)+(ii)
101,078
92,710
86,872
283,383
252,254
354,670
(i)
Employees cost
56,210
52,136
44,365
161,002
132,227
187,598
(ii)
Other operating expenses
44,868
40,574
42,507
122,381
120,027
167,072
6. TOTAL EXPENDITURE (4+5)
(excluding provisions and contingencies)308,657
308,651
307,436
926,558
897,948
1,222,501
7. OPERATING PROFIT (3-6)
(Profit before provisions and contingencies)100,220
104,481
76,035
300,993
226,985
324,719
8. Provisions (other than tax) and contingencies
43,934
62,543
16,254
147,412
60,928
118,722
9. Exceptional items
-
-
-
-
-
-
10. Profit from Ordinary Activities before tax
(7-8-9)56,286
41,938
59,781
153,581
166,057
205,997
11. Tax expense
14,319
10,368
14,609
38,886
41,075
50,720
12. Net Profit from Ordinary Activities after tax (10-11)
41,967
31,570
45,172
114,695
124,982
155,277
13. Extraordinary items (net of tax expense)
-
-
-
-
-
-
14. Net Profit for the period (12-13)
41,967
31,570
45,172
114,695
124,982
155,277
15. Minority interest
394
199
280
957
591
1,028
16. Share in Profit of Associates
241
174
270
571
725
3,771
17. Consolidated Net Profit of the group
(14-15+16)41,814
31,545
45,162
114,309
125,116
158,020
18. Paid-up Equity Share Capital
(Face value ` 2/- per Equity Share)39,917
39,893
39,846
39,917
39,846
39,853
19. Reserves excluding Revaluation Reserve
1,441,882
20. Analytical Ratios
(i)
Percentage of shares held by Government of India
NIL
NIL
NIL
NIL
NIL
NIL
(ii)
Capital Adequacy ratio (%)
Under Basel III
14.63
15.19
13.88
14.63
13.88
14.63
(iii)
Earnings per Share (EPS) (in `)
(a) Basic EPS (before and after extra ordinary items)
2.10*
1.58*
2.27*
5.73*
6.29*
7.94
(b) Diluted EPS (before and after extra ordinary items)
2.09*
1.58*
2.26*
5.72*
6.26*
7.88
(iv)
NPA Ratios
a) Gross NPA
350,521
359,172
365,657
350,521
365,657
358,015
b) Net NPA
78,449
124,985
197,379
78,449
197,379
164,953
c) % of Gross NPA
2.67
2.80
2.97
2.67
2.97
2.82
d) % of Net NPA
0.61
0.99
1.63
0.61
1.63
1.32
(v)
Return on Assets (%)
0.21*
0.17*
0.26*
0.60*
0.75*
0.92
* Not Annualised
Segment Information@
(` in Lakhs)
Particulars
Quarter ended
Nine months ended
Year ended
31.12.2020
30.09.2020
31.12.2019
31.12.2020
31.12.2019
31.03.2020
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Segment Revenue:
Treasury
61,412
60,827
42,497
216,021
156,189
223,796
Corporate/Wholesale Banking
103,742
130,786
122,589
349,470
368,790
486,614
Retail Banking
243,723
221,519
218,385
662,060
599,954
836,810
Other Banking operations
-
-
-
-
-
-
Unallocated
-
-
-
-
-
-
Total Revenue
408,877
413,132
383,471
1,227,551
1,124,933
1,547,220
Less: Inter Segment Revenue
-
-
-
-
-
-
Income from Operations
408,877
413,132
383,471
1,227,551
1,124,933
1,547,220
Segment Results (net of provisions):
Treasury
12,395
4,234
1,197
58,904
24,380
38,436
Corporate/Wholesale Banking
(2,197)
15,493
6,387
5,258
35,967
18,421
Retail Banking
46,086
22,211
52,437
89,419
105,950
149,576
Other Banking operations
-
-
-
-
-
-
Unallocated
2
-
(240)
-
(240)
(436)
Profit before tax
56,286
41,938
59,781
153,581
166,057
205,997
Segment Assets
Treasury
4,480,398
4,332,971
3,300,778
4,480,398
3,300,778
3,765,464
Corporate/Wholesale Banking
6,608,639
6,742,587
6,902,969
6,608,639
6,902,969
6,997,531
Retail Banking
7,864,126
7,330,321
6,529,866
7,864,126
6,529,866
6,832,986
Other Banking operations
-
-
-
-
-
-
Unallocated
1,070,904
777,293
754,989
1,070,904
754,989
739,352
Total
20,024,067
19,183,172
17,488,602
20,024,067
17,488,602
18,335,333
Segment Liabilities
Treasury
1,361,413
1,298,917
1,136,410
1,361,413
1,136,410
1,626,174
Corporate/Wholesale Banking
1,502,304
1,417,520
1,040,060
1,502,304
1,040,060
1,291,143
Retail Banking
15,344,065
14,686,523
13,660,971
15,344,065
13,660,971
13,649,598
Other Banking operations
-
-
-
-
-
-
Unallocated
197,146
205,895
186,739
197,146
186,739
268,086
Total
18,404,928
17,608,855
16,024,180
18,404,928
16,024,180
16,835,001
Capital employed:
(Segment Assets - Segment Liabilities)
Treasury
3,118,985
3,034,054
2,164,368
3,118,985
2,164,368
2,139,290
Corporate/Wholesale Banking
5,106,335
5,325,067
5,862,909
5,106,335
5,862,909
5,706,388
Retail Banking
(7,479,939)
(7,356,202)
(7,131,105)
(7,479,939)
(7,131,105)
(6,816,612)
Other Banking operations
-
-
-
-
-
-
Unallocated
873,758
571,398
568,250
873,758
568,250
471,266
Total
1,619,139
1,574,317
1,464,422
1,619,139
1,464,422
1,500,332
@
For the above segment reporting, the reportable segments are identified as Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking Operations in compliance with the RBI guidelines.
Notes:
1
The above Consolidated Unaudited Financial Results for the nine months ended December 31, 2020 were reviewed by the Audit Committee and subsequently taken on record and approved by the Board of Directors at its meeting held on January 20, 2021. These Results have been subjected to "Limited review" by the Statutory Central Auditors of the Bank and an unqualified review report has been issued.
2
The Consolidated Financial Results of the Group comprise the financial results of The Federal Bank Limited and its subsidiaries viz. Fedbank Financial Services Limited & Federal Operations and Services Limited and its associates viz. IDBI Federal Life Insurance Company Limited & Equirus Capital Private Limited.
3
There has been no material change in the accounting policies adopted during the quarter and nine months ended December 31, 2020 as compared to those followed for the year ended March 31, 2020.
4
Pursuant to Board approved policy on preparation of segment information, the Bank, with effect from quarter ended June 30, 2020, has revised the basis of preparation of segment information on a direct identification basis with the aid of Internal Transfer pricing mechanism for more appropriate presentation of the segment results. Accordingly, figures for the previous periods have been regrouped / reclassified to conform to current period's classification.
The change in segment information has no impact on the overall Revenue, Results, and Capital employed of the bank for the quarter and nine months ended December 31, 2020 or the previous periods/year.
5
The working results have been arrived at after considering provision for standard assets, including requirements for exposures to entities with Unhedged Foreign Currency Exposures, non-performing assets (NPAs), depreciation on investments, income-tax and other usual and necessary provisions.
6
Other income includes fees earned from providing services to customers, commission from non-fund-based banking activities, earnings from foreign exchange and derivative transactions, selling of third-party products, profit on sale of investments (net), recoveries from advances written off etc.
7
The Capital Adequacy Ratio is computed on the basis of RBI guidelines applicable on the relevant reporting dates and the ratio for the corresponding previous period is not adjusted to consider the impact of subsequent changes if any, in the guidelines.
8
The Business operations of the Bank are largely concentrated in India and for the purpose of Segment reporting, the bank is considered to operate only in domestic segment, though the bank has its operations in International Finance Service Centre (IFSC) Banking Unit in Gujarat International Finance Tec-city (GIFT). The business conducted from the same is considered as a part of Indian operations.
9
During the quarter and nine months ended December 31, 2020, the Bank has allotted 1,180,276 and 3,190,661 equity shares of ` 2 each, pursuant to the exercise of stock options by employees.
10
In accordance with RBI Circular DBR.No.BP.BC.1/21.06.201/2015-16 on Basel III Capital Regulations dated July 01, 2015 and RBI Circular DBR.No.BP.BC.80/21.06.201/2014-15 dated March 31, 2015 - 'Prudential Guidelines on Capital Adequacy and Liquidity Standards - Amendments', Banks are required to make Pillar 3 disclosure requirements including Leverage Ratio disclosure requirements that are to be made along with the publication of Financial Results. Accordingly, such applicable disclosures have been placed on the website of the Bank which can be accessed at the following link: http://www.federalbank.co.in/regulatory-disclosures. These disclosures have not been subjected to audit or review by the Statutory Central Auditors of the Bank.
11
On account of uncertainties arising from the COVID-19 pandemic across the world and in India, the extent to which the same will impact the Bank's operations and financial position will depend on various aspects including actions taken to mitigate its impact and other regulatory measures. The Bank's capital and liquidity position is strong and would continue to be the focus area for the Bank during this period.
As per the 'COVID-19 Regulatory Packages' announced by the RBI ('the RBI guidelines'), with regard to providing relief to borrowers' on account of COVID-19 pandemic, whose accounts were standard as on February 29, 2020, the Bank, in accordance with the Board approved policy had offered moratorium on repayment of loan instalments and/or deferment of interest due between March 1, 2020 and August 31, 2020, including relaxation in certain parameters, to all eligible borrowers, without considering the same as restructuring.
The Bank held a provision of ` 58,791.00 Lakhs as on September 30, 2020 against the likely impact of COVID-19, including the RBI mandated provision. During the current quarter, the bank has utilized ` 5,122.00 Lakhs from the above provision for creation of RBI mandated provision for advances restructured under "Resolution framework for COVID-19 related stress". Hence, the aggregate provision against the likely impact of COVID-19, including the RBI mandated provision, stands at ` 53,669.00 Lakhs as on December 31, 2020 and is grouped under 'Other liabilities and provisions' in the Balance sheet of the Bank.
The Honourable Supreme Court in a writ petition by Gajendra Sharma Vs Union of India & Anr vide its interim order dated September 3, 2020 has directed Banks that the accounts which were not declared Non performing asset (NPA) till August 31, 2020 shall not be declared NPA till further orders, pending disposal of the case by Supreme Court. Pursuant to the order, the Bank has not declared any account as NPA, which was not declared as NPA till August 31, 2020 as per the RBI Prudential norms on Income Recognition, Asset classification, and provisioning pertaining to advances. The Bank holds sufficient provisions in respect of these advances and as a prudent measure, the Bank has not recognized the unrealized interest on these accounts as income.
12
The figures for the quarter and nine months ended December 31, 2019 and year ended March 31, 2020 were reviewed / audited by previous statutory auditors.
13
Previous period's / year's figures have been regrouped / reclassified, where necessary to conform to current period's classification.
SHYAM SRINIVASAN
Kochi
MANAGING DIRECTOR & CEO
January 20, 2021
(DIN: 02274773)
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