REG - Federal Bank Ltd The - Half-year Report
SD/153/2021-22 November 03, 2021
To,
The London Stock Exchange
Dear Sir,
We enclose herewith the Unaudited Standalone and Consolidated Financial Results of the Bank for the quarter and half year ended September 30, 2021 along with Limited Review Report issued by the Joint Central Statutory Auditors of the Bank, which were reviewed and recommended by Audit Committee of the Board and duly approved by the Board of Directors at their respective meetings held on October 22, 2021.
Kindly take the same on your record.
For The Federal Bank Limited
Sd/-
Samir P Rajdev
Company Secretary
Varma & Varma Borkar & Muzumdar
Chartered Accountants, Chartered Accountants
No.53/2600, Kerala Varma Tower 121/168, Anand Nagar, Om Co-op
Off Kunjanbava Road, Hsg Society, Anand Nagar Lane Vytilla, Santacruz (East) Off Nehru Road,
Kochi -682019 Mumbai - 400 055
Limited Review Report on Unaudited Consolidated Financial Results of The Federal Bank Limited for the quarter/half year ended 30th September 2021, pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
The Board of Directors,
The Federal Bank Limited
1. 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 after tax of its Associates for the quarter and half-year ended 30th September 2021 (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 30th September 2021, 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.
2. The Statement, which is the responsibility of the Bank's Management and has been approved by the Bank's Board of Directors, 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 express a conclusion 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. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. 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.
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. This Statement includes the results of the following entities:
a. Fedbank Financial Services Limited (Subsidiary)
b. Federal Operations and Services Limited (Subsidiary)
c. Ageas Federal Life Insurance Company Limited (Associate)
d. Equirus Capital Private Limited (Associate)
6. 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 9, 10 and 11 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 30th September 2021, 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.
Emphasis of Matter
7. We draw attention to Note No.12 of the accompanying Statement of Unaudited Consolidated Financial results, regarding the impact of COVID-19 pandemic on the Bank's operations and financial position for the quarter/half year ended 30th September, 2021, which will depend on various uncertain aspects, including actions taken to mitigate the same and other regulatory measures.
Our conclusion on the Statement is not modified in respect of this matter.
8. We draw attention to Note No.14 of the Statements regarding amortisation of the additional liability by the Bank on account of revision in family pension amounting to ` 17,731.55 Lakhs. As stated therein, the Bank has charged an amount of ` 1,182.10 Lakhs to the Profit and Loss account for the quarter and half year ended September 30, 2021 and the balance unamortised expenditure amounting to ` 16,549.45 lakhs has been carried forward. Had the Bank charged the entire additional liability to the Profit and Loss Account, the profits for the quarter and half year ended September 30, 2021 would have been lower by ` 16,549.45 lakhs.
Our conclusion on the Statement is not modified in respect of this matter.
9. The statement of consolidated unaudited financial results includes the interim financial statements / financial information/ financial results of one subsidiary whose unaudited financial results reflects total assets of Rs 1,752.69 Lakhs as at 30th September 2021 and total revenues of Rs 1,086.56 Lakhs and Rs 1,917.78 Lakhs and total net profit after tax of Rs 136.36 Lakhs and Rs 192.95 Lakhs for the quarter ended 30th September 2021 and for the period from 1st April 2021 to 30th September 2021 respectively, and cash flows (net) of Rs 30.56 Lakhs for the period from 1st April 2021 to 30th September 2021. These interim financial statements/financial information/ financial results have been reviewed by one of the joint auditors, 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 the said subsidiary, 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.
10. The statement of consolidated unaudited financial results includes the interim financial statements / financial information/ financial results of one subsidiary whose unaudited financial results reflects total assets of Rs 5,73,303 Lakhs as at 30th September 2021 and total revenues of Rs 21,784 Lakhs and Rs 41,522 Lakhs and total net profit after tax of Rs 2,634 Lakhs and Rs 4,110 Lakhs for the quarter ended 30th September 2021 and for the period from 1st April 2021 to 30th September 2021 respectively, and cash flows (net) of Rs ( 20,632 ) Lakhs for the period from 1st April 2021 to 30th September 2021. These interim financial statements/financial information/ financial results have been reviewed by other auditors, whose reports have been furnished to us by the Management.
The statement of consolidated unaudited financial results also includes the unaudited interim financial statements / financial information/ financial results of the said subsidiary for the quarter ended 30th June 2021, quarter/half year ended 30th September 2020 and audited financial results for the year ended 31st March 2021 which have been reviewed/audited by one of the joint auditors whose reports have been furnished to us by the Management. Our conclusion on the Statement, in so far as it relates to the amounts and disclosures included in respect of the said subsidiary, 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.
11. The statement of consolidated unaudited financial results includes the Group's share of net profit after tax of Rs 240.14 Lakhs and Rs 479.56 Lakhs for the quarter and half year ended 30th September 2021, respectively, in respect of one associate whose 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.
12. The statement of consolidated unaudited financial results also includes the Group's share of net profit after tax of Rs 217.87 Lakhs and Rs 482.19 Lakhs for the quarter and half year ended 30th September 2021, respectively, in respect of one associate, based on their interim financial results which have not been reviewed. 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.
For Varma & Varma For Borkar & Muzumdar
Chartered Accountants Chartered Accountants
FRN:004532S FRN:101569W
Vijay Narayan Govind Kaushal Muzumdar
Partner Partner
M. No. 203094 M. No. 100938
UDIN: 21203094AAAACW8019 UDIN: 21100938AAAACH4444
Kochi-19 Mumbai-55
22nd October 2021 22nd October 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 HALF YEAR ENDED SEPTEMBER 30, 2021
(Rs. in Lakhs)
Particulars
Quarter ended
Half Year ended
Year ended
30.09.2021
30.06.2021
30.09.2020
30.09.2021
30.09.2020
31.03.2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
1. Interest earned (a)+(b)+(c)+(d)
3,37,925
3,35,571
3,48,790
6,73,496
6,93,205
13,75,791
(a)
Interest/discount on advances/bills
2,67,490
2,67,112
2,71,749
5,34,602
5,42,347
10,79,512
(b)
Income on investments
58,116
59,059
59,252
1,17,175
1,19,864
2,34,894
(c)
Interest on balances with Reserve Bank of India and other inter bank funds
6,662
3,662
11,661
10,324
18,728
36,817
(d)
Others
5,657
5,738
6,128
11,395
12,266
24,568
2. Other income
44,436
55,178
44,936
99,614
94,067
1,85,269
3. TOTAL INCOME (1+2)
3,82,361
3,90,749
3,93,726
7,73,110
7,87,272
15,61,060
4. Interest expended
1,89,983
1,93,728
2,10,805
3,83,711
4,25,576
8,22,420
5. Operating expenses (i)+(ii)
1,05,899
93,340
88,265
1,99,239
1,73,508
3,69,172
(i)
Employees cost
57,193
52,830
48,746
1,10,023
98,331
2,03,418
(ii)
Other operating expenses
48,706
40,510
39,519
89,216
75,177
1,65,754
6. TOTAL EXPENDITURE (4+5)
(excluding provisions and contingencies)2,95,882
2,87,068
2,99,070
5,82,950
5,99,084
11,91,592
7. OPERATING PROFIT (3-6)
(Profit before provisions and contingencies)86,479
1,03,681
94,656
1,90,160
1,88,188
3,69,468
8. Provisions (other than tax) and contingencies
24,533
54,346
53,209
78,879
92,965
1,55,741
9. Exceptional items
-
-
-
-
-
-
10. Profit from Ordinary Activities before tax
(7-8-9)61,946
49,335
41,447
1,11,281
95,223
2,13,727
11. Tax expense
15,920
12,606
10,685
28,526
24,384
54,697
12. Net Profit from Ordinary Activities after tax (10-11)
46,026
36,729
30,762
82,755
70,839
1,59,030
13. Extraordinary items (net of tax expense)
-
-
-
-
-
-
14. Net Profit for the period (12-13)
46,026
36,729
30,762
82,755
70,839
1,59,030
15. Paid-up Equity Share Capital
(Face value ` 2/- per Equity Share)42,030
39,926
39,893
42,030
39,893
39,923
16. Reserves excluding Revaluation Reserve
15,71,937
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
14.97
14.64
14.64
14.97
14.64
14.62
(iii)
Earnings per Share (EPS) (in `)
(a) Basic EPS (before and after extra ordinary items)
2.22*
1.84*
1.54*
4.06*
3.55*
7.97
(b) Diluted EPS (before and after extra ordinary items)
2.20*
1.83*
1.54*
4.04*
3.55*
7.94
(iv)
NPA Ratios
a) Gross NPA
4,44,584
4,64,933
3,55,219
4,44,584
3,55,219
4,60,239
b) Net NPA
1,50,244
1,59,324
1,21,814
1,50,244
1,21,814
1,56,928
c) % of Gross NPA
3.24
3.50
2.84
3.24
2.84
3.41
d) % of Net NPA
1.12
1.23
0.99
1.12
0.99
1.19
(v)
Return on Assets (%)
0.23*
0.19*
0.16*
0.42*
0.38*
0.85
* Not Annualised
Segment Information@
(Rs. in Lakhs)
Particulars
Quarter ended
Half Year ended
Year ended
30.09.2021
30.06.2021
30.09.2020
30.09.2021
30.09.2020
31.03.2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Segment Revenue:
Treasury
54,326
78,225
60,550
1,32,551
1,54,613
2,75,372
Corporate/Wholesale Banking
1,01,231
1,03,955
1,26,747
2,05,186
2,42,715
4,47,616
Retail Banking
2,26,737
2,08,569
2,06,429
4,35,306
3,89,944
8,37,828
Other Banking operations
-
-
-
-
-
-
Unallocated
67
-
-
67
-
244
Total Revenue
3,82,361
3,90,749
3,93,726
7,73,110
7,87,272
15,61,060
Less: Inter Segment Revenue
-
-
-
-
-
-
Income from Operations
3,82,361
3,90,749
3,93,726
7,73,110
7,87,272
15,61,060
Segment Results (net of provisions):
Treasury
9,687
37,914
4,154
47,601
46,782
72,223
Corporate/Wholesale Banking
19,299
(2,535)
15,063
16,764
6,914
22,275
Retail Banking
32,893
13,956
22,230
46,849
41,529
1,18,985
Other Banking operations
-
-
-
-
-
-
Unallocated
67
-
-
67
(2)
244
Profit before tax
61,946
49,335
41,447
1,11,281
95,223
2,13,727
Segment Assets
Treasury
46,79,820
46,11,516
43,78,891
46,79,820
43,78,891
45,25,111
Corporate/Wholesale Banking
73,05,152
70,66,184
68,09,139
73,05,152
68,09,139
71,46,590
Retail Banking
80,36,690
77,40,698
69,37,457
80,36,690
69,37,457
78,13,657
Other Banking operations
-
-
-
-
-
-
Unallocated
6,65,763
5,85,373
7,77,184
6,65,763
7,77,184
6,51,381
Total
2,06,87,425
2,00,03,771
1,89,02,671
2,06,87,425
1,89,02,671
2,01,36,739
Segment Liabilities
Treasury
11,95,828
10,92,816
13,05,303
11,95,828
13,05,303
14,13,771
Corporate/Wholesale Banking
16,96,051
14,68,615
14,05,908
16,96,051
14,05,908
16,02,533
Retail Banking
1,57,86,867
1,55,94,228
1,44,61,623
1,57,86,867
1,44,61,623
1,53,06,693
Other Banking operations
-
-
-
-
-
-
Unallocated
2,35,977
1,99,260
2,06,312
2,35,977
2,06,312
2,01,381
Total
1,89,14,723
1,83,54,919
1,73,79,146
1,89,14,723
1,73,79,146
1,85,24,378
Capital Employed:
(Segment Assets - Segment Liabilities)
Treasury
34,83,992
35,18,700
30,73,588
34,83,992
30,73,588
31,11,340
Corporate/Wholesale Banking
56,09,101
55,97,569
54,03,231
56,09,101
54,03,231
55,44,057
Retail Banking
(77,50,177)
(78,53,530)
(75,24,166)
(77,50,177)
(75,24,166)
(74,93,036)
Other Banking operations
-
-
-
-
-
-
Unallocated
4,29,786
3,86,113
5,70,872
4,29,786
5,70,872
4,50,000
Total
17,72,702
16,48,852
15,23,525
17,72,702
15,23,525
16,12,361
@
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.
Statement of Assets and Liabilities of the Bank as on September 30, 2021 is given below:
(Rs in Lakhs)
Particulars
As at 30.09.2021
As at 30.09.2020
As at 31.03.2021
Unaudited
Unaudited
Audited
CAPITAL AND LIABILITIES
Capital
42,030
39,893
39,923
Reserves and Surplus
17,30,672
14,83,632
15,72,438
Deposits
1,71,99,475
1,56,74,739
1,72,64,448
Borrowings
10,78,405
11,04,314
9,06,850
Other Liabilities and Provisions
6,36,843
6,00,093
3,53,080
Total
2,06,87,425
1,89,02,671
2,01,36,739
ASSETS
Cash and Balances with Reserve Bank of India
8,48,561
6,11,989
7,64,704
Balance with Banks and Money at Call and Short Notice
13,50,488
13,52,867
11,94,435
Investments
36,97,673
36,25,263
37,18,621
Advances
1,34,40,463
1,22,91,199
1,31,87,860
Fixed Assets
54,833
45,717
49,113
Other Assets
12,95,407
9,75,636
12,22,006
Total
2,06,87,425
1,89,02,671
2,01,36,739
Notes:
1
The above Standalone Unaudited Financial Results for the quarter and half year ended September 30, 2021 were reviewed by the Audit Committee and approved by the Board of Directors at its meeting held on October 22, 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 quarterly financial results as those followed in the annual financial statements for the year ended March 31, 2021 except as stated in Note 13 below.
3
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), provision for non-performing investments, income-tax and other usual and necessary provisions.
4
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), profit / loss on revaluation of investments, dividend received from subsidiaries / associates etc.
5
Reclassification of figures for the current period pursuant to the Master Direction on Financial Statements - Presentation and disclosures issued by Reserve Bank of India on August 30, 2021, has been made with corresponding changes in the figures for the previous periods/year to make the same comparable. Had the presentation been made in accordance with the earlier RBI instructions, Other income, Total income, Operating profit and Provisions (Other than tax) and contingencies would have been as given below:
(` in Lakhs)
Particulars
Quarter ended
Half Year ended
Year ended
30.09.2021
30.06.2021
30.09.2020
30.09.2021
30.09.2020
31.03.2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Other Income
50,962
65,014
50,933
1,15,976
99,770
1,94,491
Total Income
3,88,887
4,00,586
3,99,723
7,89,473
7,92,975
15,70,282
Operating Profit
93,005
1,13,519
1,00,653
2,06,524
1,93,891
3,78,690
Provisions (other than tax) and contingencies
31,059
64,183
59,206
95,242
98,668
1,64,963
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 half year ended September 30, 2021, the Bank has allotted 383,346 and 514,336 equity shares of ` 2 each respectively, 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: https://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
During the quarter ended September 30, 2021 , the Bank has issued 104,846,394 equity shares of Rs 2 each for cash pursuant to a preferential allotment as per the relevant provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations at ` 87.39 per share aggregating to Rs 91,625.26 Lakhs (including share premium). This resulted in an increase of Rs 2,096.93 Lakhs in Share Capital and Rs 89,476.98 Lakhs (Net of share issue expenses) in Share premium account.
11
On account of uncertainties prevailing due to COVID-19 pandemic across the world and in India, the extent to which the same will impact the Bank's operations and financial position in future 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. The extent to which the COVID-19 pandemic will continue to impact the Bank's results will depend on the future developments related to the situation, as well as the outcomes of the actions taken to contain the same.
12
i) Details of resolution plan implemented under the Resolution Framework for COVID-19-related Stress as per RBI circular dated August 6, 2020 are given below:
Format - A
(` in lakhs except number of accounts)
Type of borrower
(A) Number of accounts where resolution plan has been implemented under this window
(B) exposure to accounts mentioned at (A) before implementation of the plan
(C) Of (B), aggregate amount of debt that was converted into other securities
(D) Additional funding sanctioned, if any, including between invocation of the plan and implementation
(E) Increase in provisions on account of the implementation of the resolution plan
Personal Loans
4,025
93,514.99
-
-
9,351.50
Corporate persons
7
14,249.46
-
90.65
1,424.95
Of which, MSMEs
-
-
-
-
-
Others
92
4,619.94
-
-
461.99
Total
4,124
1,12,384.39
-
90.65
11,238.44
Format - B
(` in lakhs except number of accounts)
Type of borrower
Exposure to accounts
classified as Standard
consequent to implementation of resolution plan - Position as at the end of the previous half-year ended March 31 , 2021 (A)*Of (A), aggregate debt that slipped into NPA during the
half-yearOf (A) amount
written off during the half-yearOf (A) amount paid by the borrowers
during the half- yearExposure to accounts
classified as Standard
consequent to implementation of resolution plan - Position as at the end of this half-year ended September 30 , 2021 #
Personal Loans
95,316.43
1,705.30
-
3,619.23
2,05,112.29
Corporate persons
14,249.46
-
-
1,019.81
14,137.66
Of which, MSMEs
-
-
-
-
-
Others
4,627.01
174.36
-
572.86
49,939.61
Total
1,14,192.90
1,879.66
-
5,211.90
2,69,189.56
*includes restructuring implemented during the quarter ended June 30, 2021 under the Resolution Framework 1.0
#This also includes cases implemented as per RBI circular for i) Resolution Framework for COVID-19-related Stress dated August 6, 2020 & ii) Resolution Framework - 2.0 for Covid-19 related stress of Individuals and Small Businesses dated May 5, 2021.
ii) Details of resolution plan implemented in accordance with the RBI Cir. No. DOR.STR.REC.11/21.04.048/2021-22 dated May 05, 2021 on "Resolution Framework - 2.0: Resolution of Covid - 19 related stress of Individuals and Small Business" are given below.
(` in lakhs except number of accounts)
Description
Individual Borrowers
Small
businesses
Personal Loans
Business Loans
A) Number of requests received for invoking resolution process under Part A
6,743
1,604
16,385
B) Number of accounts where resolution plan has been implemented under this window
5,262
467
7,848
C) Exposure to accounts mentioned at (B) before implementation of the plan
1,09,980.44
15,410.31
29,579.75
D) Of (C), aggregate amount of debt that was converted into other securities
-
-
-
E) Additional funding sanctioned,if any,Including between invocation of the plan and implementation
-
-
-
F) Increase in provisions on account of the implementation of the resolution plan
13,217.78
1,838.21
3,811.65
iii) In accordance with the RBI Cir. No. DOR.STR.REC.11/21.04.048/2021-22 dated May 05, 2021 on "Resolution Framework - 2.0: Resolution of Covid - 19 related stress of Individuals and Small Business", the number of borrower accounts where modifications were sanctioned and implemented and the aggregate exposure to such borrowers are as under
(` in lakhs except number of accounts)
No. of Accounts
118
Aggregate Exposure as on September 30, 2021
3,355.12
iv) During the quarter ended September 30, 2021, as a prudent measure, over and above the regulatory minimum provision required for restructured advances, based on the internal assessment, the Bank has created ` 12,000.00 Lakhs additional provision against the accounts restructured under the resolution frameworks.
13
During the current quarter, the bank has estimated & fully recognized the additional liability on account of revision in family pension for employees covered under the 11th Bipartite Settlement and Joint Note dated November 11, 2020 amounting to ` 17,731.55 Lakhs. In accordance with the letter dated October 4, 2021 issued by RBI, permitting all member banks of Indian Banks' Association to amortise the said additional liability over a period not exceeding five years beginning with the financial year ended March 31, 2022, subject to a minimum of 1/5th of the total amount being expensed every year, the bank has opted to amortize the said liability over a period not exceeding five years beginning with the financial year ended March 31, 2022, subject to a minimum of ` 3,546.31 Lakhs being expensed every financial year. Accordingly, the Bank has charged an amount of ` 1,182.10 Lakhs to the Profit and Loss account for the quarter and half year ended September 30, 2021 and the balance unamortised expenditure amounting to Rs ` 16,549.45 Lakhs has been carried forward. Had the Bank charged the entire additional liability to the Profit and Loss Account, the profits for the quarter and half year ended September 30, 2021 would have been lower by ` 16,549.45 Lakhs.
14
The Honourable Supreme Court of India , vide an interim order dated September 3, 2020, had directed that accounts which were not declared NPA till August 31 , 2020 shall not be declared as NPA till further orders, which has been complied with by the Bank. The said interim order stood vacated on March 23, 2021 and the Bank continued with the asset classification of borrower accounts as per the extant RBI instructions / IRAC norms. In view of this, the results for the half-year ended September 30 , 2021 may not be comparable with the corresponding half year ended September 30, 2020.
15
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
October 22, 2021
(DIN: 02274773)
Varma & Varma Borkar & Muzumdar
Chartered Accountants, Chartered Accountants
No.53/2600, Kerala Varma Tower 121/168, 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 Consolidated Financial Results of The Federal Bank Limited for the quarter/half year ended 30th September 2021, pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
The Board of Directors,
The Federal Bank Limited
1. 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 after tax of its Associates for the quarter and half-year ended 30th September 2021 (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 30th September 2021, 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.
2. The Statement, which is the responsibility of the Bank's Management and has been approved by the Bank's Board of Directors, 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 express a conclusion 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. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. 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.
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. This Statement includes the results of the following entities:
e. Fedbank Financial Services Limited (Subsidiary)
f. Federal Operations and Services Limited (Subsidiary)
g. Ageas Federal Life Insurance Company Limited (Associate)
h. Equirus Capital Private Limited (Associate)
6. 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 9, 10 and 11 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 30th September 2021, 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.
Emphasis of Matter
7. We draw attention to Note No.12 of the accompanying Statement of Unaudited Consolidated Financial results, regarding the impact of COVID-19 pandemic on the Bank's operations and financial position for the quarter/half year ended 30th September, 2021, which will depend on various uncertain aspects, including actions taken to mitigate the same and other regulatory measures.
Our conclusion on the Statement is not modified in respect of this matter.
8. We draw attention to Note No.14 of the Statements regarding amortisation of the additional liability by the Bank on account of revision in family pension amounting to ` 17,731.55 Lakhs. As stated therein, the Bank has charged an amount of ` 1,182.10 Lakhs to the Profit and Loss account for the quarter and half year ended September 30, 2021 and the balance unamortised expenditure amounting to ` 16,549.45 lakhs has been carried forward. Had the Bank charged the entire additional liability to the Profit and Loss Account, the profits for the quarter and half year ended September 30, 2021 would have been lower by ` 16,549.45 lakhs.
Our conclusion on the Statement is not modified in respect of this matter.
9. The statement of consolidated unaudited financial results includes the interim financial statements / financial information/ financial results of one subsidiary whose unaudited financial results reflects total assets of ` 1,752.69 Lakhs as at 30th September 2021 and total revenues of ` 1,086.56 Lakhs and ` 1,917.78 Lakhs and total net profit after tax of ` 136.36 Lakhs and ` 192.95 Lakhs for the quarter ended 30th September 2021 and for the period from 1st April 2021 to 30th September 2021 respectively, and cash flows (net) of ` 30.56 Lakhs for the period from 1st April 2021 to 30th September 2021. These interim financial statements/financial information/ financial results have been reviewed by one of the joint auditors, 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 the said subsidiary, 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.
10. The statement of consolidated unaudited financial results includes the interim financial statements / financial information/ financial results of one subsidiary whose unaudited financial results reflects total assets of ` 5,73,303 Lakhs as at 30th September 2021 and total revenues of ` 21,784 Lakhs and ` 41,522 Lakhs and total net profit after tax of ` 2,634 Lakhs and ` 4,110 Lakhs for the quarter ended 30th September 2021 and for the period from 1st April 2021 to 30th September 2021 respectively, and cash flows (net) of ` ( 20,632 ) Lakhs for the period from 1st April 2021 to 30th September 2021. These interim financial statements/financial information/ financial results have been reviewed by other auditors, whose reports have been furnished to us by the Management.
The statement of consolidated unaudited financial results also includes the unaudited interim financial statements / financial information/ financial results of the said subsidiary for the quarter ended 30th June 2021, quarter/half year ended 30th September 2020 and audited financial results for the year ended 31st March 2021 which have been reviewed/audited by one of the joint auditors whose reports have been furnished to us by the Management. Our conclusion on the Statement, in so far as it relates to the amounts and disclosures included in respect of the said subsidiary, 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.
11. The statement of consolidated unaudited financial results includes the Group's share of net profit after tax of Rs 240.14 Lakhs and Rs 479.56 Lakhs for the quarter and half year ended 30th September 2021, respectively, in respect of one associate whose 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.
12. The statement of consolidated unaudited financial results also includes the Group's share of net profit after tax of Rs 217.87 Lakhs and Rs 482.19 Lakhs for the quarter and half year ended 30th September 2021, respectively, in respect of one associate, based on their interim financial results which have not been reviewed. 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.
For Varma & Varma For Borkar & Muzumdar
Chartered Accountants Chartered Accountants
FRN:004532S FRN:101569W
Vijay Narayan Govind Kaushal Muzumdar
Partner Partner
M. No. 203094 M. No. 100938
UDIN: 21203094AAAACW8019 UDIN: 21100938AAAACH4444
Kochi-19 Mumbai-55
22nd October 2021 22nd October 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 HALF YEAR ENDED SEPTEMBER 30, 2021
(Rs in Lakhs)
Particulars
Quarter ended
Half Year ended
Year ended
30.09.2021
30.06.2021
30.09.2020
30.09.2021
30.09.2020
31.03.2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
1. Interest earned (a)+(b)+(c)+(d)
3,56,627
3,52,498
3,62,188
7,09,125
7,19,399
14,31,408
(a)
Interest/discount on advances/bills
2,86,506
2,84,295
2,85,376
5,70,801
5,68,150
11,35,314
(b)
Income on investments
57,532
58,463
59,284
1,15,995
1,19,938
2,33,829
(c)
Interest on balances with Reserve Bank of India and other inter bank funds
6,662
3,662
11,661
10,324
18,728
36,816
(d)
Others
5,927
6,078
5,867
12,005
12,583
25,449
2. Other income
44,719
52,442
44,947
97,161
93,572
1,86,564
3. TOTAL INCOME (1+2)
4,01,346
4,04,940
4,07,135
8,06,286
8,12,971
16,17,972
4. Interest expended
1,95,947
2,00,016
2,15,941
3,95,963
4,35,596
8,43,496
5. Operating expenses (i)+(ii)
1,13,287
98,955
92,710
2,12,242
1,82,305
3,89,867
(i)
Employees cost
61,785
56,990
52,136
1,18,775
1,04,792
2,17,202
(ii)
Other operating expenses
51,502
41,965
40,574
93,467
77,513
1,72,665
6. TOTAL EXPENDITURE (4+5)
(excluding provisions and contingencies)3,09,234
2,98,971
3,08,651
6,08,205
6,17,901
12,33,363
7. OPERATING PROFIT (3-6)
(Profit before provisions and contingencies)92,112
1,05,969
98,484
1,98,081
1,95,070
3,84,609
8. Provisions (other than tax) and contingencies
26,453
57,263
56,546
83,716
97,775
1,63,753
9. Exceptional items
-
-
-
-
-
-
10. Profit from Ordinary Activities before tax
(7-8-9)65,659
48,706
41,938
1,14,365
97,295
2,20,856
11. Tax expense
16,860
13,150
10,368
30,010
24,567
56,136
12. Net Profit from Ordinary Activities after tax (10-11)
48,799
35,556
31,570
84,355
72,728
1,64,720
13. Extraordinary items (net of tax expense)
-
-
-
-
-
-
14. Net Profit for the period (12-13)
48,799
35,556
31,570
84,355
72,728
1,64,720
15. Minority interest
685
384
199
1,069
563
1,524
16. Share in Profit of Associates
458
504
174
962
330
3,237
17. Consolidated Net Profit of the group
(14-15+16)48,572
35,676
31,545
84,248
72,495
1,66,433
18. Paid-up Equity Share Capital
(Face value ` 2/- per Equity Share)42,030
39,926
39,893
42,030
39,893
39,923
19. Reserves excluding Revaluation Reserve
16,09,799
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
15.63
15.36
15.19
15.63
15.19
15.19
(iii)
Earnings per Share (EPS) (in `)
(a) Basic EPS (before and after extra ordinary items)
2.34*
1.79*
1.58*
4.14*
3.64*
8.34
(b) Diluted EPS (before and after extra ordinary items)
2.32*
1.77*
1.58*
4.11*
3.63*
8.31
(iv)
NPA Ratios
a) Gross NPA
4,55,819
4,79,318
3,59,172
4,55,819
3,59,172
4,64,639
b) Net NPA
1,59,578
1,71,242
1,24,985
1,59,578
1,24,985
1,60,471
c) % of Gross NPA
3.22
3.51
2.80
3.22
2.80
3.35
d) % of Net NPA
1.15
1.28
0.99
1.15
0.99
1.18
(v)
Return on Assets (%)
0.23*
0.17*
0.17*
0.40*
0.39*
0.86
* Not Annualised
Segment Information@
(` in Lakhs)
Particulars
Quarter ended
Half Year ended
Year ended
30.09.2021
30.06.2021
30.09.2020
30.09.2021
30.09.2020
31.03.2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Segment Revenue:
Treasury
54,420
75,037
60,623
1,29,457
1,54,686
2,74,511
Corporate/Wholesale Banking
1,00,380
1,02,583
1,25,557
2,02,963
2,40,573
4,43,371
Retail Banking
2,45,019
2,27,320
2,20,955
4,72,339
4,17,712
8,99,846
Other Banking operations
1,460
-
-
1,460
-
-
Unallocated
67
-
-
67
-
244
Total Revenue
4,01,346
4,04,940
4,07,135
8,06,286
8,12,971
16,17,972
Less: Inter Segment Revenue
-
-
-
-
-
-
Income from Operations
4,01,346
4,04,940
4,07,135
8,06,286
8,12,971
16,17,972
Segment Results (net of provisions):
Treasury
10,388
35,345
4,234
45,733
46,509
72,226
Corporate/Wholesale Banking
19,084
(2,737)
15,493
16,347
7,455
21,547
Retail Banking
34,662
16,098
22,211
50,760
43,333
1,26,839
Other Banking operations
1,458
-
-
1,458
-
-
Unallocated
67
-
-
67
(2)
244
Profit before tax
65,659
48,706
41,938
1,14,365
97,295
2,20,856
Segment Assets
Treasury
46,28,017
45,66,638
43,32,971
46,28,017
43,32,971
44,79,657
Corporate/Wholesale Banking
72,50,870
70,10,074
67,42,587
72,50,870
67,42,587
70,83,959
Retail Banking
85,73,839
82,15,751
73,30,321
85,73,839
73,30,321
82,82,563
Other Banking operations
477
-
-
477
-
-
Unallocated
6,64,952
5,85,205
7,77,293
6,64,952
7,77,293
6,50,474
Total
2,11,18,155
2,03,77,668
1,91,83,172
2,11,18,155
1,91,83,172
2,04,96,653
Segment Liabilities
Treasury
12,06,212
11,11,142
12,98,917
12,06,212
12,98,917
14,03,276
Corporate/Wholesale Banking
17,07,578
14,80,815
14,17,520
17,07,578
14,17,520
16,09,960
Retail Banking
1,61,29,690
1,58,73,983
1,46,86,523
1,61,29,690
1,46,86,523
1,56,11,703
Other Banking operations
218
-
-
218
-
-
Unallocated
2,34,453
1,98,806
2,05,895
2,34,453
2,05,895
1,99,818
Total
1,92,78,151
1,86,64,746
1,76,08,855
1,92,78,151
1,76,08,855
1,88,24,757
Capital Employed:
(Segment Assets - Segment Liabilities)
Treasury
34,21,805
34,55,496
30,34,054
34,21,805
30,34,054
30,76,381
Corporate/Wholesale Banking
55,43,292
55,29,259
53,25,067
55,43,292
53,25,067
54,73,999
Retail Banking
(75,55,851)
(76,58,232)
(73,56,202)
(75,55,851)
(73,56,202)
(73,29,140)
Other Banking operations
259
-
-
259
-
-
Unallocated
4,30,499
3,86,399
5,71,398
4,30,499
5,71,398
4,50,656
Total
18,40,004
17,12,922
15,74,317
18,40,004
15,74,317
16,71,896
@
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.
Statement of Assets and Liabilities of the Group as on September 30, 2021 is given below:
(Rs in Lakhs)
Particulars
As at 30.09.2021
As at 30.09.2020
As at 31.03.2021
Unaudited
Unaudited
Audited
CAPITAL AND LIABILITIES
Capital
42,030
39,893
39,923
Reserves and Surplus
17,70,027
15,15,764
16,10,300
Minority Interest
27,947
18,660
21,673
Deposits
1,71,92,543
1,56,48,514
1,72,18,611
Borrowings
14,24,010
13,47,911
12,27,060
Other Liabilities and Provisions
6,61,598
6,12,430
3,79,086
Total
2,11,18,155
1,91,83,172
2,04,96,653
ASSETS
Cash and Balances with Reserve Bank of India
8,50,556
6,13,172
7,65,451
Balance with Banks and Money at Call and Short Notice
13,89,386
13,63,110
12,16,123
Investments
36,45,870
35,79,343
36,73,167
Advances
1,38,58,319
1,25,90,255
1,35,51,441
Fixed Assets
58,312
48,378
51,749
Other Assets
13,15,712
9,88,914
12,38,722
Total
2,11,18,155
1,91,83,172
2,04,96,653
Notes:
1
The above Consolidated Unaudited Financial Results for the quarter and half year ended September 30, 2021 were reviewed by the Audit Committee and subsequently taken on record and approved by the Board of Directors at its meeting held on October 22, 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. Ageas 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 half year ended September 30, 2021 as compared to those followed for the year ended March 31, 2021 except as stated in Note 14 below.
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), provision for non-performing 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), profit / loss on revaluation of investments, dividend received from subsidiaries / associates etc.
6
Reclassification of figures for the current period pursuant to the Master Direction on Financial Statements - Presentation and disclosures issued by Reserve Bank of India on August 30, 2021, has been made with corresponding changes in the figures for the previous periods/year to make the same comparable. Had the presentation been made in accordance with the earlier RBI instructions, Other income, Total income, Operating profit and Provisions (Other than tax) and contingencies would have been as given below:
(Rs. in Lakhs)
Particulars
Quarter ended
Half Year ended
Year ended
30.09.2021
30.06.2021
30.09.2020
30.09.2021
30.09.2020
31.03.2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Other Income
51,244
62,279
50,944
1,13,523
99,275
1,95,786
Total Income
4,07,871
4,14,777
4,13,132
8,22,648
8,18,674
16,27,194
Operating Profit
98,637
1,15,806
1,04,481
2,14,443
2,00,773
3,93,831
Provisions (other than tax) and contingencies
32,978
67,100
62,543
1,00,078
1,03,478
1,72,975
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 half year ended September 30, 2021, the Bank has allotted 383,346 and 514,336 equity shares of ` 2 each respectively, 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: https://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
During the quarter ended September 30, 2021 , the Bank has issued 104,846,394 equity shares of Rs 2 each for cash pursuant to a preferential allotment as per the relevant provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations at Rs 87.39 per share aggregating to Rs 91,625.26 Lakhs (including share premium). This resulted in an increase of Rs 2,096.93 Lakhs in Share Capital and ` 89,476.98 Lakhs (Net of share issue expenses) in Share premium account.
12
On account of uncertainties prevailing due to COVID-19 pandemic across the world and in India, the extent to which the same will impact the Bank's operations and financial position in future 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. The extent to which the COVID-19 pandemic will continue to impact the Bank's results will depend on the future developments related to the situation, as well as the outcomes of the actions taken to contain the same.
13
i) Details of resolution plan implemented under the Resolution Framework for COVID-19-related Stress as per RBI circular dated August 6, 2020 are given below.
Format - A
(Rs in lakhs except number of accounts)
Type of borrower
(A) Number of accounts where resolution plan has been implemented under this window
(B) exposure to accounts mentioned at (A) before implementation of the plan
(C) Of (B), aggregate amount of debt that was converted into other securities
(D) Additional funding sanctioned, if any, including between invocation of the plan and implementation
(E) Increase in provisions on account of the implementation of the resolution plan
Personal Loans
4,025
93,514.99
-
-
9,351.50
Corporate persons
7
14,249.46
-
90.65
1,424.95
Of which, MSMEs
-
-
-
-
-
Others
92
4,619.94
-
-
461.99
Total
4,124
1,12,384.39
-
90.65
11,238.44
Format - B
(Rs in lakhs except number of accounts)
Type of borrower
Exposure to accounts
classified as Standard
consequent to implementation of resolution plan - Position as at the end of the previous half-year ended March 31 , 2021 (A)*Of (A), aggregate debt that slipped into NPA during the
half-yearOf (A) amount
written off during the half-yearOf (A) amount paid by the borrowers
during the half- yearExposure to accounts
classified as Standard
consequent to implementation of resolution plan - Position as at the end of this half-year ended September 30 , 2021 #
Personal Loans
95,316.43
1,705.30
-
3,619.23
2,05,112.29
Corporate persons
14,249.46
-
-
1,019.81
14,137.66
Of which, MSMEs
-
-
-
-
-
Others
4,627.01
174.36
-
572.86
49,939.61
Total
1,14,192.90
1,879.66
-
5,211.90
2,69,189.56
*includes restructuring implemented during the quarter ended June 30, 2021 under the Resolution Framework 1.0
#This also includes cases implemented as per RBI circular for i) Resolution Framework for COVID-19-related Stress dated August 6, 2020 & ii) Resolution Framework - 2.0 for Covid-19 related stress of Individuals and Small Businesses dated May 5, 2021.
ii) Details of resolution plan implemented in accordance with the RBI Cir. No. DOR.STR.REC.11/21.04.048/2021-22 dated May 05, 2021 on "Resolution Framework - 2.0: Resolution of Covid - 19 related stress of Individuals and Small Business" are given below.
(Rs in lakhs except number of accounts)
Description
Individual Borrowers
Small
businesses
Personal Loans
Business Loans
A) Number of requests received for invoking resolution process under Part A
6,743
1,604
16,385
B) Number of accounts where resolution plan has been implemented under this window
5,262
467
7,848
C) Exposure to accounts mentioned at (B) before implementation of the plan
1,09,980.44
15,410.31
29,579.75
D) Of (C), aggregate amount of debt that was converted into other securities
-
-
-
E) Additional funding sanctioned,if any,Including between invocation of the plan and implementation
-
-
-
F) Increase in provisions on account of the implementation of the resolution plan
13,217.78
1,838.21
3,811.65
iii) In accordance with the RBI Cir. No. DOR.STR.REC.11/21.04.048/2021-22 dated May 05, 2021 on "Resolution Framework - 2.0: Resolution of Covid - 19 related stress of Individuals and Small Business", the number of borrower accounts where modifications were sanctioned and implemented and the aggregate exposure to such borrowers are as under
(Rs in lakhs except number of accounts)
No. of Accounts
118
Aggregate Exposure as on September 30, 2021
3,355.12
iv) During the quarter ended September 30, 2021, as a prudent measure, over and above the regulatory minimum provision required for restructured advances, based on the internal assessment, the Bank has created ` 12,000.00 Lakhs additional provision against the accounts restructured under the resolution frameworks.
14
During the current quarter, the bank has estimated & fully recognized the additional liability on account of revision in family pension for employees covered under the 11th Bipartite Settlement and Joint Note dated November 11, 2020 amounting to ` 17,731.55 Lakhs. In accordance with the letter dated October 4, 2021 issued by RBI, permitting all member banks of Indian Banks' Association to amortise the said additional liability over a period not exceeding five years beginning with the financial year ended March 31, 2022, subject to a minimum of 1/5th of the total amount being expensed every year, the bank has opted to amortize the said liability over a period not exceeding five years beginning with the financial year ended March 31, 2022, subject to a minimum of ` 3,546.31 Lakhs being expensed every financial year. Accordingly, the Bank has charged an amount of ` 1,182.10 Lakhs to the Profit and Loss account for the quarter and half year ended September 30, 2021 and the balance unamortised expenditure amounting to Rs ` 16,549.45 Lakhs has been carried forward. Had the Bank charged the entire additional liability to the Profit and Loss Account, the profits for the quarter and half year ended September 30, 2021 would have been lower by ` 16,549.45 Lakhs.
15
The Honourable Supreme Court of India , vide an interim order dated September 3, 2020, had directed that accounts which were not declared NPA till August 31 , 2020 shall not be declared as NPA till further orders, which has been complied with by the Bank. The said interim order stood vacated on March 23, 2021 and the Bank continued with the asset classification of borrower accounts as per the extant RBI instructions / IRAC norms. In view of this, the results for the half-year ended September 30 , 2021 may not be comparable with the corresponding half year ended September 30, 2020.
16
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
October 22, 2021
(DIN: 02274773)
THE FEDERAL BANK LIMITED
REGD.OFFICE: P.B.NO. 103, FEDERAL TOWERS, ALUVA-683101
(CIN: L65191KL1931PLC000368)
CASH FLOW STATEMENT FOR THE HALF YEAR ENDED SEPTEMBER 30, 2021
(Rs in Lakhs)
Half Year ended
September 30, 2021Half Year ended
September 30, 2020Cash Flow from Operating Activities
Net Profit before taxes
1,11,281
95,223
Adjustments for:
Depreciation on Bank's Property
5,875
6,133
Provision / Depreciation on Investments
3,408
(878)
Amortisation of Premium on Held to Maturity Investments
8,434
6,761
Provision / Charge for Non Performing Assets
44,108
42,573
Provision for Standard Assets and Contingencies
47,726
56,973
(Profit)/Loss on sale of fixed assets (net)
26
(24)
Dividend From Subsidiaries / Joint ventures / Associates
(2,704)
-
2,18,154
2,06,761
Adjustments for working capital changes:-
(Increase)/ Decrease in Investments [excluding Held to Maturity Investments]
(2,33,373)
92,983
(Increase)/ Decrease in Advances
(2,96,711)
(1,06,980)
(Increase)/ Decrease in Other Assets
(68,899)
(30,787)
Increase/ (Decrease) in Deposits
(64,973)
4,45,730
Increase/ (Decrease) in Other liabilities and provisions
2,36,037
1,97,327
(4,27,919)
5,98,273
Direct taxes paid (net)
(33,028)
(26,945)
Net Cash Flow from / (Used in) Operating Activities
(2,42,793)
7,78,089
Cash Flow from Investing Activities
Purchase of Fixed Assets
(11,698)
(3,922)
Proceeds from Sale of Fixed Assets
76
96
Dividend From Subsidiaries / Joint ventures / Associates
2,704
-
Investment in Subsidiary
(14,799)
-
Investment in Associate
(74)
-
(Increase)/ Decrease in Held to Maturity Investments
2,57,353
(1,34,861)
Net Cash generated / (Used in) Investing Activities
2,33,562
(1,38,687)
Cash Flow from Financing Activities
Proceeds from Issue of Share Capital
2,107
40
Proceeds from Share Premium (Net of Share issue Expenses)
89,723
711
Increase/(Decrease) in Borrowings (Excluding Subordinate Debt)
1,71,555
67,071
Dividend Paid
(13,974)
-
Net Cash generated from Financing Activities
2,49,411
67,822
Effect of exchange fluctuation on translation reserve
(270)
174
Net Increase in Cash and Cash Equivalents
2,39,910
7,07,398
Cash and Cash Equivalents at the beginning of the period
19,59,139
12,57,458
Cash and Cash Equivalents at the end of the period
21,99,049
19,64,856
Note:
Cash and Cash Equivalents comprise of Cash in hand (including foreign currency notes), Balances with Reserve Bank of India, Balances with banks and money at call and short notice.
SHYAM SRINIVASAN
Kochi
MANAGING DIRECTOR & CEO
October 22, 2021
(DIN: 02274773)
THE FEDERAL BANK LIMITED
REGD.OFFICE: P.B.NO. 103, FEDERAL TOWERS, ALUVA-683101
(CIN: L65191KL1931PLC000368)
CONSOLIDATED CASH FLOW STATEMENT FOR THE HALF YEAR ENDED SEPTEMBER 30, 2021
(Rs in Lakhs)
Half Year ended
September 30, 2021Half Year ended
September 30, 2020Cash Flow from Operating Activities
Net Profit before taxes
1,14,258
97,062
Adjustments for:
Depreciation on Group's Property
6,449
6,547
Provision / Depreciation on Investments
3,408
(525)
Amortisation of Premium on Held to Maturity Investments
8,434
6,761
Provision / Charge for Non Performing Assets
46,383
42,653
Provision for Standard Assets and Contingencies
50,288
61,350
(Profit)/ Loss on sale of fixed assets (net)
26
(25)
2,29,246
2,13,823
Adjustments for working capital changes:-
(Increase)/ Decrease in Investments [excluding Held to Maturity Investments]
(2,41,896)
1,20,822
(Increase)/ Decrease in Advances
(3,53,261)
(1,47,958)
(Increase)/ Decrease in Other Assets
(71,500)
(31,396)
Increase/ (Decrease) in Deposits
(26,067)
4,23,324
Increase/ (Decrease) in Other liabilities and provisions
2,32,223
1,94,703
(4,60,501)
5,59,495
Direct taxes paid (net)
(35,500)
(30,115)
Net Cash Flow from / (Used in) Operating Activities
(2,66,755)
7,43,203
Cash Flow from Investing Activities
Purchase of Fixed Assets
(13,117)
(4,522)
Proceeds from Sale of Fixed Assets
78
103
(Increase)/ Decrease in Held to Maturity Investments
2,57,353
(1,34,861)
Net Cash generated / (Used in) Investing Activities
2,44,314
(1,39,280)
Cash Flow from Financing Activities
Proceeds from Issue of Share Capital
2,107
40
Proceeds from Share Premium (Net of share issue Expenses)
89,723
712
Increase / (Decrease) in Minority Interest
6,273
563
Increase/(Decrease) in Borrowings (Excluding Subordinate Debt)
1,96,951
95,139
Dividend Paid
(13,974)
-
Net Cash generated from financing Activities
2,81,080
96,454
Effect of exchange fluctuation on translation reserve
(270)
174
Increase/(Decrease) in Cash and Cash Equivalents
2,58,369
7,00,551
Cash and Cash Equivalents at the beginning of the period
19,81,573
12,75,731
Cash and Cash Equivalents at the end of the period
22,39,942
19,76,282
Note:
Cash and Cash Equivalents comprise of Cash in hand (including foreign currency notes), Balances with Reserve Bank of India, Balances with banks and money at call and short notice.
SHYAM SRINIVASAN
Kochi
MANAGING DIRECTOR & CEO
October 22, 2021
(DIN: 02274773)
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