The Board of Directors of AU Small Finance Bank Limited at its meeting held today; approved the unaudited financial results for the quarter ended June 30, 2020.
The Bank has registered AUM Growth of 17% Y-o-Y in which retail AUM remains dominant at ~84%. Q1FY21 PAT (excluding gains on partial divestment of Aavas Financiers Ltd.) grew by 48% YoY to INR 177 Cr. ROA and ROE were at 1.6% and 15.8% in this quarter (excluding gains on partial divestment of Aavas Financiers Ltd.).
The bank disbursed INR 1,181 Cr which includes disbursements under TLTRO 2.0 of INR 246 Cr. Operating expenses declined by 6% Y-o-Y and 30% Q-o-Q due to low growth momentum.
Complete Moratorium has been availed by 11% of the Bank’s borrowers by value on Gross Advances as of 30th June 2020. SMA pool, which was INR 2,768 Cr as on 29th Feb 2020 has now reduced to INR 1,133 Cr as on 30th June 2020.
During this quarter, Bank made provisions of INR 181 Cr including the additional provision of ₹ 140 Cr for the potential impact of COVID-19 in addition to ₹ 138 Cr COVID-19 provision created in last quarter (other than standard and NPA Provisions).
The bank now carries INR 278 Cr of COVID-19 related provisions which constitute ~1% of our total Gross Advances & ~10% of Complete Moratorium book.
Full EMI recovery has also improved to 67% in the month of June from 53% in the month of April.
On an average 80% of customers pays in full and another 5% in part in normal times; therefore gap inactivation is only 13% which expect further narrow down in July and August. Overall Collection efficiency* improved to 90% in June from 54% in April; based on our ground reports we expect further improvement in July. The average monthly collection efficiency from April 2019 to February 2020 was at ~98%.
Since the beginning of the lockdown, all branches were operational with no shutdowns. Share of Retail Deposits continued to increase; rising to 45% vs 43% in Q4FY20 and 42% in Q1FY20 led by dedicated verticals focused on CASA and collective effort of all bank employees.
26 branches gained market share above 5% market while 4 branches gained market share above 10%. AU Bank’s Savings Account deposits grew by 14% q-o-q, led by retail depositors. Savings Account deposits grew by INR 370 Cr in Q1 vs an average growth of INR 41 Cr in the previous 4 quarters.
The Bank evolved its business approach in “Urban Market Banking” and “Core Market Banking” with differentiated tactics. Core Market Banking covers semi-urban and rural markets where the bank will capitalize on the vintage of 25 years. Urban Market Banking covers metropolitan areas that have huge potential to grow along with the profile-based segmentation of customers.
“Being in a very uncertain environment, bank made additional provisions to create extra buffer to build resilience, financial stability and to strengthen its Balance-sheet. During pandemic times, the bank wishes everyone very good health and better times ahead.
Being into essential services, we are extremely committed to serving the nation and society with utmost dedication and agility,” he added.
Considering the social distancing protocols of current times, AU Bank recently organized its 25th AGM virtually.