Tag: DCB Bank

DCB Bank shares rise over 13% on ₹1,000-crore fundraising plan, strong Q4FY24 results

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of DCB Bank Ltd surged more than 13% on Wednesday, April 24, following the announcement of a ₹1,000-crore fund-raising plan and healthy growth in net profit in the March quarter.

In an exchange filing, DCB Bank disclosed plans to raise funds amounting to ₹1,000 crore through various financial instruments, including debt securities and equity shares.

At the meeting of the Board of Directors, held on April 23, the bank approved an enabling resolution for fund-raising activities. This includes issuing debt securities, including Unsecured Redeemable Non-Convertible Subordinated Basel III compliant Tier-2 Bonds, up to ₹500 crore. These bonds will be issued through private placement in one or more tranches over the next year, subject to approval from the bank’s shareholders and regulatory authorities.

Additionally, the board approved another resolution proposing to raise funds up to ₹500 crore by issuing equity shares or other securities convertible into equity shares through a Qualified Institutions Placement (QIP), the private lender informed the stock exchanges.

DCB Bank also reported a healthy growth in profit and improvement in asset class for the quarter ended March 31, 2024.

The lender’s profit after tax (PAT) stood at ₹156 crore, up 9% from the ₹142 crore in the year-ago quarter. Similarly, for the entire fiscal year 2024, the bank reported PAT of ₹536 crore, marking a growth of 15% compared to FY23.

DCB Bank’s loan portfolio saw significant expansion, with a year-on-year (YoY) growth of 19%, due to strong growth across segments such as mortgages, co-lending, construction finance, and agri and inclusive banking. Deposit growth also surged by 20% YoY.

DCB Bank also maintained a healthy asset quality, as the Gross NPA stood at 3.23% and Net NPA at 1.11% as of March 31, 2024. The bank’s Provision Coverage Ratio (PCR) stood at 77.30%, and PCR excluding Gold Loans NPAs was 78.18%. DCB Bank’s Capital Adequacy Ratio was at 16.59%.

Shares of DCB Banks closed at ₹136.45 apiece, up 10.17%, on the BSE.

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DCB Bank Q4 Results: Shares jump 10% after best asset quality in four quarters, provisions fall

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of DCB Bank Ltd. rose as much as 9.5% on Wednesday after the Mumbai-based private lender reported its best asset quality in four quarters.

Gross NPA in the quarter stood at 3.23% from 3.43% in the December quarter, while net NPA fell to 1.11% from 1.22% last quarter.

Both advances and deposits grew by 19% each compared to the same quarter last year. Advances stood at ₹40,924 crore, while deposits stood at ₹49,353 crore.

DCB Bank’s Net Interest Income during the quarter increased by 4.4% from last year to ₹507.5 crore. The figure was higher than the Motilal Oswal estimate of ₹488.5 crore.

Net profit also rose 9.5% from last year to ₹155.6 crore. A Motilal Oswal estimate had projected the figure at ₹131.6 crore. Other income for the quarter went up by 11.3% from last year to ₹136.2 crore.

Provisions for the quarter more-than-halved from last year, and fell by 41% from the December quarter to ₹24.3 crore.

For the March quarter, the lender’s Credit-Deposit ratio stood at 82.92% from 83.37% last year and 82.51% in the previous quarter.

Additionally, the board has approved raising funds to the tune of ₹1,000 crore. Of this, ₹500 crore will be raised through the issue of Unsecured, redeemable non-convertible subordinate Basel-III compliant Tier-2 bonds, while the other ₹500 crore will be raised through the issue of equity shares, QIP or other options.

Shares of DCB Bank are trading 10% higher at ₹136.3. Despite this surge, the stock is still down 7% for 2024. This is also the best single day gain for the stock since April 2022.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

DCB Bank Q3 results: Net profit rises 11%, net interest income up 6%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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DCB Bank on Wednesday, January 24, posted an 11.2% increase in net profit to ₹126.6 crore for the third quarter of FY24, against ₹113.9 crore in the same period last year. The bank’s net interest income (NII) registered a growth of 6.3%.

The NII for Q3FY24 reached ₹474 crore, compared to ₹446 crore in the corresponding period of the previous fiscal year.

The gross non-performing asset (NPA) ratio stood at 3.43%, compared to 3.36% in the previous quarter.

The net NPA ratio showcased an improvement from the previous quarter. As of Q3FY24, the net NPA ratio was reported at 1.22%, down from 1.28% in the previous quarter.

The capital adequacy ratio (CAR), as of December 31, 2023, stood at 15.72%.

Murali M. Natrajan, Managing Director & CEO of DCB Bank, commented on the results, stating, “We are pleased with the sustained growth in our net profit and net interest income. Our focused approach on asset quality is reflected in the marginal improvement in NPA ratios. The bank remains committed to maintaining a robust financial position and delivering value to our stakeholders.”

ALSO READ | Canara Bank Q3 results: Net profit rises 27%, net interest income 9.5% up

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

RBI clears appointment of Praveen A Kutty as MD of DCB Bank

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Private sector DCB Bank on Tuesday (January 16) said the Reserve Bank of India (RBI) approved the appointment of Praveen Achuthan Kutty as its Managing Director and CEO.

The appointment for a period of three years is effective from April 29, 2024, DCB Bank said in a regulatory filing.

Also Read: HDFC Bank Q3 results: Net profit rises 34%, net interest income 24% up

A meeting of the Board of Directors will be convened in due course to approve the appointment of Kutty as the MD and CEO, and subsequently, approval of the shareholders shall be obtained, it added.

Kutty has been part of the DCB Bank leadership team for the past 16 years. He, alongside the current MD and CEO and management team, played a key role in the turnaround of the bank.

At present, he manages retail, SME, and agri banking, the filing said.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

DCB Bank shares gain over 3% after board approves ₹83 crore fund infusion from its promoter

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Mumbai-based private lender DCB Bank Ltd., gained over 3% on Monday after it announced the issue of equity shares to one of its promoters on a preferential basis.

The preferential issue of shares will result in infusion of ₹83 crore in the lender from its promoter Aga Khan Fund for Economic Development S.A. (AKFED). The promoter entity will be issued 60.58 lakh equity shares of the bank at an issue price of ₹137 per share, which is a 14% premium to last Friday’s closing price for DCB Bank.

DCB Bank will conduct a Postal Ballot to seek the approval of its shareholders for the preferential issue.

Post the fund infusion, the promoter shareholding in the lender will rise to 15.66% from 14% earlier.

The bank last week had stated that the fund infusion by the promoter will further strengthen its capital position and support growth plans.

DCB Bank also announced that the board has approved the resignation of its head of operations, technology and human resource and CIO R Venkattesh from the bank. DCB Bank stated in a filing that Venkattesh has resigned to pursue other interests and his last working day with the bank would be February 7, 2024.

Shares of DCB Bank are trading 3% higher at ₹124.80.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Underperforming bank shares rally after promoter proposes $10 million fund infusion

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of private lender DCB Bank Ltd. rose as much as 5% on Tuesday after its promoter – Aga Khan Fund for Economic Development (AKFED) expressed interest to invest up to $10 million to strengthen the bank’s capital and fuel its growth plans.

The bank will hold a board meeting on December 8 to consider this proposal.

DCB Bank’s Switzerland-based promoter currently holds a 14.03% stake in the lender as of the end of the September quarter. It plans on making the capital infusion by subscribing to additional equity shares of the bank.

The bank’s capital-to-risk (weighted) assets ratio (CRAR) was at 16.55% as of September 30, 2023, excluding the corresponding half-year net profit.

The Tier I capital stood at 14.28%, while the Tier II capital was 2.27%.

Earlier in July, the RBI had given approval to Tata Asset Management Pvt. Ltd to acquire aggregate holding of up to 7.5% of DCB Bank through the schemes of Tata Mutual Fund. The Fund holds 5.50% stake as of September 30.

Shares of DCB Bank are marginally off the day’s high but are trading 3.6% higher at ₹116.95. The bank’s shares have been underperformers in 2023, currently down 8% so far. It has delivered negative annual returns to shareholders in three out of the last four years.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

DCB Bank promoter AKFED plans $10-million fresh investment

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Private sector lender DCB Bank Ltd on Monday (December 4) said its promoter, Aga Khan Fund for Economic Development (AKFED), is considering an investment of up to $10 million.

“Aga Khan Fund for Economic Development (AKFED) (the Promoter) (the Major Shareholder) has expressed its interest to invest up to $10 million (equivalent INR at prevailing exchange rate) by subscribing to additional equity shares of the bank,” DCB Bank said in a regulatory filing.

The infusion of capital is proposed through the subscription of additional equity shares of the bank and is subject to compliance with applicable laws and regulations.

DCB Bank, known for its capital-efficient business model, reported a capital-to-risk (weighted) assets ratio (CRAR) of 16.55% as of September 30, 2023, excluding the corresponding half-year net profit.

Also Read: These small finance banks offer interest rates over 7% on savings accounts

The Tier I capital stood at 14.28%, with Tier II capital contributing 2.27% to the overall CRAR. The move to bring in additional investment aligns with the bank’s commitment to maintaining a robust financial position and furthering its growth trajectory.

The bank’s board of directors is set to convene on December 8, 2023, to deliberate and assess the proposed investment by AKFED. If approved by the board, the proposal will progress to seek shareholders’ approval in accordance with applicable laws and regulations.

Shares of DCB Bank Ltd ended at ₹113, down by ₹0.050, or 0.044%, on the BSE.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

DCB Bank shares dip 5% as Q1 slippages rise and NIM declines; NIM guidance between 3.5-3.75%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Mumbai-based private sector lender DCB Bank plunged over 5 percent in Monday’s trade after the bank reported its April-June FY24 quarter numbers. The lender reported a healthy quarter, with earnings growth of 30 percent year-on-year (YoY) led by 25 percent YoY operating profit growth. However, it was lower than analysts’ forecasts, as NIM compression was higher at 40 basis points quarter-on-quarter (QoQ).

Loan growth remained healthy at 20 percent YoY. Headline gross NPL (nonperforming loans) ratios were stable, but slippages were higher, though its impact on credit cost was negligible, analysts say.

NIM guidance between 3.5-3.75%

Speaking to CNBC-TV18 on Monday, Murali M Natrajan, the MD and CEO of DCB Bank said that the lender’s NIM guidance is between 3.5-3.75 percent and that they don’t expect similar compression in NIM going ahead.

“We have built the business model and I have been guiding this for quite some time, at a margin of about 370 to 375 basis point. This quarter our margin is 3.83, so I can argue that our margin is still higher than the business model that we have created,” Natrajan said.

Explaining further, the CEO said, “The methodology works like this, that when EBLR is changed based on repo rate changes, cost of funds takes a little time to catch up. In more recently, cost of funds have not been raising so fast. So I don’t expect similar kinds of compression in our margin, and we should be able to hold on to our business model names.”

“Most of our portfolio is repriceable portfolio so therefore, even if the cost of funds goes up, I don’t believe that our margin compression would be severe. So we should be able to sustain with the product mix and the cost of funds mix at about 370-375 basis points,” Natrajan added.

The lender’s MD and CEO also said that DCB Bank should be able to double its balance sheet every three to four years. “We don’t give guidance on yearly basis. But the kind of frontline investment we have done, including the number of branches that we have added in the last one to two years, and the kind of products plus the process improvement, the technology that we are putting in, we believe that we should be able to double our balance sheet every three to four years.”

On deposits and loan growth, he expects the current trend to continue. “Our deposit growth has been about 22 percent, our loan growth has been at about 19 percent. But if you look a little deeply the core products like mortgages, home loan, co-lending, construction finance, agri inclusive banking, which is our core business has grown at higher than 20 percent, so we expect this trend to continue,” Natarajan said.

He further said, “The recoveries and upgrades is where we had a little bit of slowness, and we are building pipeline of recoveries and upgrades. If you look at whole of last year, our recovery and upgrades were almost 100 percent of the slippages. And I believe that in the next one to two quarters, we should rebuild the momentum in recovery and upgrades while slowing down the NPAs.”

Through technology process improvement, and also because of the growth that the bank is likely to achieve for the investment it has made in the last couple of years, the CEO expects the cost of income ratio to come down step by step.

Domestic brokerage house Kotak believes the bank is on track to deliver a healthy loan growth and better operating leverage, leading to higher RoEs (return on equities). It has a ‘Buy’ rating on the counter, with a target price of Rs 160, suggesting a potential upside of 30 percent from the current market levels.

DCB Bank stock is down 4.40 percent on a year-to-date basis, while it has rallied 43.74 percent in the last one year.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Max Life partners with DCB Bank to offer comprehensive range of life insurance solutions

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Max Life Insurance Company on Tuesday announced its partnership with DCB Bank. Through this collaboration, Max Life and DCB Bank will provide life insurance products to the bank’s customers, including term, savings, and retirement plans, allowing them to protect their financial future and expand their investment portfolio.

The business tie-up will offer bank customers access to Max Life’s protection and long-term savings solutions, offering financial stability for themselves and their families, the insurer said.

Praveen Kutty, Head Retail Banking, DCB Bank, said, “DCB Bank’s tie-up with Max Life will pave the way for adaptable, and varied life insurance products for our customers. Through this partnership, we aim to empower our customers by providing them with life insurance products that cater to their needs.”

Max Life Insurance Company Limited is a Joint Venture between Max Financial Services and Axis Bank. Max Financial Services is a part of Max Group. Max Life offers protection and long-term savings life insurance solutions, through its multi-channel distribution including agency and third-party distribution partners

DCB Bank, on the other hand, is a new generation private sector bank with 427 branches (as on March 31, 2023) across India. It is a scheduled commercial bank regulated by the Reserve Bank of India.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

DCB Bank jumps most in five months after RBI allows Tata Mutual Fund to buy up to 7.5% stake

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of private sector lender DCB Bank Ltd. gained as much as 8 percent in trade on Thursday after the Reserve Bank of India (RBI) gave approval to the Tata Mutual Fund to increase its stake in the bank.

The central bank has granted its approval to Tata Asset Management Pvt. Ltd to acquire aggregate holding of up to 7.5 percent of the paid-up equity capital of DCB Bank through the schemes of Tata Mutual Fund.

The approval is valid for a period of one year from the date of the RBI letter. Tata Asset Management has also been advised by RBI to ensure that its aggregate shareholding in the bank shall not exceed 7.5 percent of the paid-up capital of the bank at any time.

Currently, Tata MF holds a 4.95 percent stake in DCB Bank.

On Wednesday, Axis Securities was bullish on DCB Bank and recommended a ‘Buy’ rating on the stock with a target price of Rs 150 per share.

In its research report dated July 5, Axis securities said that the improved demand outlook and the management’s guidance of doubling the balance sheet size in the next 3-4 years should keep DCB Bank’s credit/deposit book healthy at around 18/17 percent CAGR (compounded annual growth rate) over financial year 2023-2025.

During the March 2023 quarter, DCB Bank had posted a 25 percent increase in its net profit to Rs 142 crore, while total income during the period rose to Rs 608 crore from Rs 495 crore in the same period of the previous fiscal year, the bank said.

Shares of DCB Bank ended 5.5 percent higher at Rs 128.7. While the stock is flat year-to-date, it has risen over 60 percent during the last 12 months.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow