Indias National Export Credit Agency Investor Presentation - - PowerPoint PPT Presentation

India’s National Export Credit Agency Investor Presentation

September 2019

Presentation Outline

Exim Key Credit Highlights The India Story The Exim Bank Story Appendix

2

Exim Bank: Key Credit Highlights

 Set up under an Act of Parliament in 1981  100% owned by the Government of India (“GoI”)  Policy Bank for India’s Economic Diplomacy  International investment grade ratings at par with Sovereign  Policy Business Guaranteed / Insured by the Sovereign  Strong regulatory capital position  Exim Bank Bonds eligible for inclusion in EMBIG

4

Exim Bank: Key Credit Highlights

India’s engine for growth of International Trade

India: Strong Macro backed by supportive policy Environment Board and Management Strength Exim: Proxy to Sovereign Financial Strength Policy Role at National Level

1 2 3 4 5

The India Story

India: Strong Macro backed by supportive Policy Environment

Resilient GDP Growth(1,2,3)

• World’s 7th largest economy based on nominal GDP in CY 2018.(2)
• Nominal GDP for CY 2018: ~US$ 2.7 tn.(2)
• World’s 3rd largest economy based on GDP measured in PPP terms in CY2018.(2)
• GDP in PPP terms for CY 2018: ~US$ 10.5 tn.(2)
• India is set to become the 5th largest economy based on nominal GDP by 2019.(2)
• Real GDP growth estimated at 5% in Q1 FY20(3); Full year growth projected at 6.9% in FY20. (4)
• India jumped up 23 notches to the 77th position from 100 during 2017-18 on the World Bank’s ‘Ease of Doing Business’ Index 2019.

Source: (1) Institute of International Finance (IIF); (2) IMF World Economic Outlook April 2019 & July 2019 Update. Data for CY; (3) Ministry of Statistics and Programme Implementation (MOSPI); (4) Reserve Bank of India (RBI); CY means calendar year ; FYxx means financial year ended March 31, 20xx.; E- IIF Estimates; P – IMF Projections

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18.2% 17.7% 17.9% 17.2% 16.1% 30.0% 30.0% 29.4% 29.3% 29.6% 51.8% 52.3% 52.7% 53.5% 54.3% 2043 2148 2287 2626 2779 7.4% 8.0% 8.2% 7.2% 6.8%

FY 15 FY 16 FY 17 FY 18 FY 19E (US$ bn)

Agriculture (%) Industry (%) Services (%) Real GDP Growth (%) 7.2% 6.8% 7.0% 7.2% 6.8% 6.6% 6.2% 6.0% 2.2% 2.9% 2.6% 1.9% 3.8% 3.6% 3.2% 3.5% CY 2017 CY 2018 CY 2019 P CY 2020 P India China United States World

Indian Economy: Key Economic Indicators

Banking Sector Statistics(2)

Key Parameters FY17 FY18 FY19 Change Gross Domestic Saving (% of GDP) (3) 30.3 30.5

• Gross Domestic Investment (% of GDP) (3)

30.9 32.3

• Gross Fixed Capital Formation (% of GDP) (3)

28.2 28.6 29.3 70 bps Fiscal Deficit (% of GDP) (3) 3.5 3.5 3.4 (10 bps) Revenue Deficit (% of GDP) (3) 2.1 2.6 2.2 (40 bps) FDI Inflows (US$ bn) (2) 60.2 61.0 64.4 5.60% Exchange Rate (INR/US$, avg.) (2) 67.1 64.5 67.1 4.10%

Source: (1) Institute of International Finance (IIF) Database; (2) Reserve Bank of India, Press Releases and Online Database (accessed online on 10/09/2019); (3) Central Statistics Office; E- IIF Estimates; * Annual Average CPI inflation with base year 2012=100

Key Parameters FY17 FY18 FY19 Change Credit Deposit Ratio 73.0 74.2 78.2 400 bps Banking Sector CRAR 13.7 13.8 14.3 50 bps Banking Sector NPAs 8.6 11.2 9.1 (210 bps) Provision Coverage Ratio 43.5 48.3 60.9 1260 bps NBFC CRAR 22.1 22.8 19.3 (350 bps) NBFC NPAs 6.1 5.8 6.6 80 bps 51.4 51.5 49.6 49.1 48.2 15.2 17.1 15.6 19.8 20.1 66.6 68.6 65.2 68.9 68.3

FY 15 FY 16 FY 17 FY 18 FY 19E

Centre State

Key Macroeconomic Metrices General Government Debt (% of GDP) (1) Inflation/ Policy Rates (2)* 7

Source: (1) MOCI; (2) Balance of Payment Statistics, RBI; CAD – Current Account Deficit

Composition of CAD(2)

46 40 44 37 29 28 25 27 53 Exports 141 65 48 55 46 34 32 20 73 Imports Petroleum Products Gems & Jewellery Chemicals Electronics Items Machinery Ores & Minerals Base Metals Transport Equipment Others Agri & Allied Products Textiles

Sound External Sector

Trade Trends(1)(2)

US$ 330 bn US$ 513 bn

US$ 208 bn US$ 126 bn

7 22 21 3 40 33 Imports Telecom, computer & information services Travel Transport Financial services Other Business services Others

Merchandise Trade Pattern in FY 19(1)

80 28 17 5 19 46 Exports

Services Trade Pattern in FY19(2)

• 14.4
• 48.7
• 57.2
• 0.6%
• 1.9%
• 2.1%

FY17 FY18 FY19 (US$ bn)

Trade Deficit Services Surplus Primary Income Secondary Income Current Account Deficit CAD (% of GDP)

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439 499 538 136 480 584 639 163 163 195 208 81 96 118 126 127

FY17 FY18 FY19 FY 20 (Apr-Jun) (US$ bn)

Services Exports Services Imports Merchandise Exports Merchandise Imports 276 384 466 330 304 513 55 36

Sound External Sector

Major Trading Partners(1) India’s Export Markets(1) India’s Import Sources (1)

Note: Data for North America does not include Mexico; Mexico has been included in Latin America; the above charts represent India’s merchandise trade for FY 2019 Source: (1) MOCI

Regional Trade Direction(1)

Asia 49% Europe 20% North America 17% Africa 9% Latin America 4% CIS, Baltics & Others 2% Exports Asia 62% Europe 15% North America 8% Africa 8% Latin America 5% CIS, Baltics & Others 2% Imports 88 87 60 34 31 28 24 24 21 21 19 18 17 17 17 17

• 54

0.3

• 23
• 5
• 5
• 21
• 6
• 12
• 11
• 17
• 8
• 4
• 4
• 10

(US$ bn) Total Trade Trade Balance

China USA UAE Iraq Singapore Hong Kong Saudi Arabia Germany Iran Belgium Malaysia Japan Switzerland Indonesia

• Rep. of Korea

2% 3% 3% 3% 3% 4% 4% 5% 9% 16% Nepal Netherlands Germany Bangladesh UK Singapore Hong Kong China UAE USA 3% 3% 3% 4% 4% 4% 6% 6% 7% 14% Indonesia Singapore

• Rep. of Korea

Hong Kong Switzerland Iraq Saudi Arabia UAE USA China

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External Debt vis-à-vis External Reserves

(1) ‘Volatile Capital Flows’ is defined to include cumulative portfolio inflows and short-term debt (RBI). For FY19, Volatile Capital Flow ratio pertains to end-Dec’18; (2) Volatile Capital Flows to Reserves ratio peaked at 97.4% in September 2013; (3) Source: RBI/Ministry of Finance, Government of India; * Short-term debt with residual maturity

External Debt 543.0 External Reserves 412.9 External Debt External Reserves

(US$ bn)

As on Mar 2019 As on Mar 2019 Analysis of External Debt vs External Reserves

38% 24% 20% 11% 5% 2% Commercial Borrowings Short Term Non Resident Multilateral Bilateral Trade Credit

10

93% 6% 1%

FC Assets Gold SDRs / Reserve Tranche

Recent Policy Measures to Boost Growth

• INR 100 trillion for developing modern infrastructure over 5 years; inter-ministerial Task force to be set up by Department of

Economic Affairs to finalise pipeline infrastructure projects

• Delayed Payments from Government/ Central Public Sector Enterprises (CPSEs) to be monitored by Department of Expenditure

Infrastructure Consumption demand

Automotive Sector

• BS IV vehicles purchased till March 31, 2020 to remain operational for entire period of registration
• Revision of one time registration fees deferred till June 2020
• Rate of depreciation on all vehicles (acquired until March 31, 2020) increased to 30%
• Both electric vehicles (EVs) and internal combustion vehicles (ICVs) will continue to be registered.
• Government to focus on setting up infrastructure for development of ancillaries /components including batteries for export
• Ban on purchase of new vehicles for replacing all old vehicles by government departments to be lifted

Housing Sector

• Easing of ECB guidelines for HFCs to facilitate financing for eligible borrowers under Pradhan Mantri Awas Yojana (Housing for All)
• The interest rate on House Building Advance shall be lowered and linked to 10 Year G Sec Yields
• Setting up of a Special Window, to provide last mile funding for housing projects which are non- NPA and non-NCLT projects and are

net worth positive in affordable and middle income category.

• One day required to incorporate a company - Central Registration Centre for name reservation & incorporation.
• Amendment to MSME Act - Single definition to be considered
• UK Sinha Committee recommendations on ease of credit, marketing, technology, delayed payments etc. to be considered
• Banks to issue improved transparent One Time Settlement policy to benefit MSME and retail borrowers in settling their overdues for

improved transparency.

Corporate Affairs & MSME

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Tax Incentives

• Corporate Tax reduced to 22% (effective rate of 25.17% incl. surcharge & cess) from 30% for companies not seeking any incentives/

exemptions; These companies are also not required to pay Minimum Alternate Tax (MAT)

• Fresh investments by a domestic manufacturing firm incorporated on/before October 1, 2019 to be taxed at only 15% (effective rate of

17.01% incl. surcharge & cess), reduced from 25%, provided production commences before March 31, 2023

• Companies that opt out of concessional tax regime and avail the tax exemption/incentive to pay pre-amended rates, can opt for

concessions after expiry of tax holiday

• MAT reduced to 15% from 18.5% for companies availing exemptions

Recent Policy Measures to Boost Growth

• Enhanced surcharge withdrawn on long term and short term capital gains arising from sale of equity in a company or a unit of an equity
• riented fund or a unit of a business trust liable for securities transaction tax. This would ensure flow of funds from both domestic

investors and FPIs.

• Government to take further action on development of Credit Default Swap markets in consultation with RBI and SEBI.
• Ministry of Finance to work with RBI to make it more conducive for investors and bond issuers, as well as facilitate increased trading
• Government has amended the Companies (Share capital and Debenture rules) 2014 to remove the requirement for creation of a

Debenture Redemption Reserve (DRR) of outstanding debentures in respect of listed companies, NBFCs and for HFCs.

• Establishment of an organisation to provide Credit Enhancement for infrastructure and housing projects proposed, in order to improve

access to long term finance.

Capital & Financial Markets Banks/NBFCs/ Amalgamation

• f Banks
• Upfront release of INR 700 billion (announced in Budget), providing additional lending and liquidity to the tune of INR 5 trillion to PSBs.
• Reduced EMI for housing loans, vehicle and other retail loans by directly linking Repo rate to interest rates; Working capital loans for

industry to also become cheaper

• Partial Credit Guarantee scheme for purchase of pooled assets of NBFCs/ HFCs upto INR 1,000 billion
• Additional liquidity support of INR 200 billion to NBFCs/HFCs by National Housing Bank (NHB) thereby increasing it to INR 300 billion
• Amalgamating Banks to have enhanced capacity to increase credit; strong national presence and global reach; increased operational

efficiency and reduce cost of lending; enhanced risk appetite with thrust on NextGen technology for banking; wider offerings with enhanced customisation; and better ability to raise resources from markets

• Capital infusion of INR 552.5 billion announced for amalgamating banks to boost credit growth

Recent Policy Measures to Boost Growth

• Scheme for Remission of Duties or Taxes on Export Product (RoDTEP) to replace MEIS January 01, 2020. Revenue foregone projected

at INR 500 billion.

• Fully automated electronic refund route for Input Tax Credits (ITC) in GST
• Scope of Export Credit Insurance Scheme (ECIS) by ECGC to be expanded by providing higher insurance cover to banks lending

working capital for exports.

• Priority Sector Lending (PSL) norms for Export Credit to be revised, this would release an additional INR 360 billion to INR 680 billion

as export credit under priority sector. An Inter Ministerial Working Group in Department of Commerce to be set up to monitor Export Finance.

• “Time to Export or Turn-around time” reduced through seamless digitization process benchmarked to international standards and

elimination of offline/manual services by Dec 2019

• An Online “Origin Management System” for exporters to enable them to obtain Certificates of Origin – CoO (under Rules of Origin)

to be launched by DGFT.

• Special FTA Utilisation Mission to enhance awareness among exporters for concessional tariff utilization under each FTA.
• To overcome non-tariff barriers, a Working Group on Technical Standards to be set up to lay down a roadmap for adoption of

standards, time lines and enforcement.

• Affordable testing and certification infrastructure to be expanded and developed in PPP mode to enable internationally accepted

tests and certification within India.

Export Promotion Measures Foreign Direct Investment

• 100% FDI in coal & lignite mining for captive consumption by power projects, iron &steel and cement units as well as for sale of coal

and related activities through automatic route

• 100% FDI through automatic route in manufacturing including contract manufacturing through wholesale/retail (including e-

commerce)

• 100% FDI in single brand retail with relaxed sourcing norms to promote increased sourcing of goods from India
• 26% FDI with Government approval for digital media

The Exim Bank Story

Exim Bank: India’s Export Credit Agency

Genesis Vision 15 “To develop commercially viable relationships with a target set of externally oriented companies by offering them a comprehensive range of products and services, aimed at enhancing their internationalisation efforts” Set up under an Act of Parliament in 1981 by the Government of India “for providing financial assistance to exporters and importers, and for functioning as the principal financial institution for coordinating the working of institutions engaged in financing export and import of goods and services with a view to promoting the country’s international trade…” “… shall act on business principles with due regard to public interest” Objectives



An instrument of Government policy as India’s official Export Credit Agency.



100% owned by Government of India



Cannot be liquidated without GoI approval

• A track record of GoI capital infusion



Proxy to the India Sovereign in international debt markets.



Board of Directors are appointed by GoI

• Comprises top officials from key GoI ministries (Finance, Commerce and

Industry and External Affairs) and Reserve Bank of India.



GoI Backstop – Policy Business guaranteed/ insured by the Sovereign



Exim Bank Bonds eligible for inclusion in EMBIG

Exim Bank: Proxy to Sovereign

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Policy Bank 100%

• wned by

GoI Proxy to India Sovereign in International Debt Markets Directors Appointed by GoI GoI Backstop: Policy Business Strong Government Support

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Exim Bank: Capital Infusion / Proxy to Sovereign

Budget allocation of INR 15 bn from GoI for FY 2020 (INR 9.5 bn by way of capital infusion and INR 5.5 bn through Recap Bonds). Out of INR 9.5 billion, INR 8 billion received on July 05, 2019 and INR 1.5 billion received on August 30, 2019.

Exim’s credit rating has been on par with India sovereign rating since its establishment International Rating is Baa2 (Stable) International Rating is BBB- (Stable) International Rating is BBB- (Stable) Domestic Rating is AAA (Stable) Domestic Rating is AAA (Stable) Domestic Rating is AAA (Stable) International Rating is BBB+ (Stable)

Government Capital Infusion

Exim Bank’s Line of Business

Export Finance Lines of Credit / CFS Buyer’s Credit – NEIA Pre-Shipment Credit Post-Shipment Credit Guarantees and L/Cs Export Capability Creation Term Loans Working Capital Export Product Development Export Facilitation

Overseas Investment Finance

Import Finance Guarantees and L/Cs

[1]: As on June 30, 2019; [2] Excluding India; [3] Exposures value of less than 1% are excluded INR 1034 bn INR 152 bn

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Loan Portfolio [1][3] Non-Funded Portfolio [1] Risk Exposure [1] Country Exposure[1][2][3]

Sub-Saharan Africa 41.48% South Asia 34.61% SEA FE & PAC 6.84% North Africa 6.26% Europe 3.25% Americas 3.97% West Asia 3.49% Export Finance 59.16% Term Loan to Exporters 21.36% Overseas Investment Finance 12.81% Import Finance 4.34% Export Facilitation 2.29% Performance Guarantee 40.84% Advance Payment Gurantee 35.31% Retention Money Guarantee 2.06% Financial Guarantee 13.56% Letters of Credit 7.34% Bid Bond Guarantee 0.89%

GOI Risk 48% Corporate Risk (Secured) 39% Bank Risk/ Corporate Risk (Unsecured) 13%

81% 76% 88% 87% 19% 24% 12% 13% FY 17 FY 18 FY 19 3MFY20

Medium/Long Term Loans Short Term Loans

86% 82% 94% 92% 14% 18% 6% 8% FY 17 FY 18 FY 19 3MFY20

Direct Refinance

33% 31% 24% 26% 67% 69% 76% 74% FY 17 FY 18 FY 19 3MFY20

Rupee Foreign Currency

Exim Bank- Line of Business

Above data as on June 30, 2019;

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34% 36% 47% 48% 66% 64% 53% 52% FY 17 FY 18 FY 19 3MFY20

Policy Business Commercial Business

Asset Quality

Non Performing Assets(2)(3)

% of Total Loan outstanding NPAs as % of Total GNPAs A

Note: [1] Excludes advances under Lines of Credit, Buyer’s Credit under NEIA and staff loans which cannot be classified under any particular sector; [2] As on June 30, 2019; [3] Others includes industries with exposure less than 1% of the Gross Loan Outstanding. * PCR: Provision Coverage Ratio & AUCA: Advance Under Collection Accounts

20 Current credit watchlist of INR 19.12 bn including IL&FS Group (INR 2.96 bn) Gross Loans outstanding by Major Industries(1)(2)(3)

9.03% 4.98% 3.85% 4.00% 3.53% 2.70% 2.16% 2.01% 1.54% 1.56% 1.53% 1.42% 1.41% 1.12% 1.00% 10.16% 0.00% 8.85% 5.76% 24.20% 1.87% 2.72% 0.00% 3.99% 1.00% 0.00% 7.33% 12.72% 8.07% 2.32% 0.44% 20.74%

Bank & FIs Ferrous Metal & Processing Textiles and Garments Oil and Gas Chemicals and Dyes Drugs & Pharma Petroleum Products Petrochemicals Renewable energy Shipping Services Mining and Minerals Ship building EPC Services Agro & Food Processing Auto & Auto Components Others Standard Gross NPL

9.24% 10.37% 11.34% 11.19%

4.68% 3.75% 2.44% 2.29% 52% 66% 80% 81% 55% 71% 85% 86%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00%

FY 17 FY 18 FY 19 3MFY20 Gross NPA Net NPA PCR Net of AUCA* PCR including AUCA*

Insolvency and Bankruptcy Code: Faster NPA resolution

A

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Outstanding Provision (%) Net Book Value Expected Recovery (A) Exim Loans admitted/ referred 56.76 83% 9.79 15.98 (B) Guarantors for Exim Loans[2] 33.61 89% 3.68 6.90 Total 90.37 85% 13.47 22.88 Lending Programme % of Total NPAs % of Bank’s Exposure Overseas Investment Finance 43.32 4.85 Term Loan to Exporters * 25.02 2.80 Export Finance ** 20.18 2.26 Import Finance 11.45 1.28 Export Facilitation 0.03 0.00 Total 100 11.19

Note: # National Company Law Tribunal [1] As on June 30, 2019; [2] Corporate under NCLT which are Guarantor to the Loans extended by Exim Bank. * includes Export Oriented Units (EOUs), ** includes Buyers Credit, Deemed exports, EPCDF and PPSC etc.

Exim’s Loan Accounts under Exposure to NCLT #(1)

Non Performing Assets(1)

Exim Bank-Financial Highlights

[1] Includes loans and advances to industrial concerns, scheduled banks, foreign governments and other financial institutions and bills of exchange and promissory notes discounted / rediscounted. Amounts stated are net

• f provisions for non-performing assets (NPAs).

22 Capital Strength Profitability Total Assets, Loans and Advances(1) Solvency Ratio

14.29% 8.82% 17.71% 18.10% 1.52% 1.53% 1.36% 1.52% 15.81% 10.35% 19.07% 19.62% FY17 FY18 FY19 3MFY20 Tier I (%) Tier II (%) CAR (%) 2.50 2.38 6.41 6.81 FY17 FY18 FY19 3MFY20 1,172 1,235 1,146 1,171 1,026 1,075 936 940

34% 36% 47% 48%

FY17 FY18 FY19 3MFY 20 (INR bn)

Total Assets Policy Business (Loans and Advances)

Commercial Business (Loans and Advances)

66% 64% 53% 52% 24.81 19.31 20.68 5.83 19.39 16.52 19.70 5.56 21.68 61.61 18.81 4.10 0.41 (29.24) 0.82 0.63 1.70 1.31 1.56 1.84 FY17 FY18 FY19 3MFY20 Operating Profit (INR bn) Net Interest Income (INR bn) Provisions (INR bn) Net Profit (INR bn) NIM (%)

Asset Liability Management

A

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Fully hedged position on currency and basis risk. Both Assets and Liabilities on floating LIBOR basis. Exim Bank’s quasi sovereign status enables issuance at benchmark rates. Debut 10 year 144A issuance in July 2016 and the second 10 year 144A issuance in January 2018 for USD 1 bn each under GMTN Program. Regular issuer in the International debt markets with 26 issuances since 2004 under the MTN including 4 Uridashi and 2 144A issuances. 5 Samurai issuances

since February 2006 including the latest issued in 2 tranches in September 2019.

Issuances across currencies including USD, AUD, CHF, CNY, JPY, MXN, SGD, TRY and ZAR

[1) As on June 30, 2019

Foreign Currency Asset Liability Gaps[1] Total Resources/ Loans[1]

FC Resources 71% Rupee Resources 16% Capital & Reserves 13% FC Loans 74% Rupee Loans 26% 239 239 212 178 278 222 260 282 58 238 <= 1 yr 1-3 yr 3-5 yr 5-7 yr >7 yr Maturing Assets (Equ. INR bn) Maturing Liabilities (Equ. INR bn)

Exim Bank - Board of Directors

A

Directors representing Ministries of Finance, Commerce and External Affairs Directors representing major Indian Public Sector Banks Director representing regulator - RBI Director representing India’s Export Credit Insurance Company Whole Time Directors

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Bidyut Behari Swain Additional Secretary, Department of Commerce, Ministry of Commerce and Industry Pankaj Jain Additional Secretary, Department of Financial Services, Ministry of Finance Rajnish Kumar Chairman, State Bank of India Rakesh Sharma Managing Director and CEO, IDBI Bank Rajkiran Rai G. Managing Director and CEO, Union Bank of India T.S. Tirumurti Secretary (Economic Relations), Ministry of External Affairs Kalyanaraman Rajaraman Additional Secretary (Investment), Department of Economic Affairs, Ministry

• f Finance

Michael Debabrata Patra Executive Director, Reserve Bank of India Geetha Muralidhar Chairman-cum- Managing Director, ECGC Ltd. David Rasquinha Managing Director

Exim Bank – Institutionalised Risk Management Culture

A

 Officer of the rank of General Manager designated as Chief Risk Officer for credit, market and operational risks.  Tasked with risk management of the Bank’s business processes and driving the Bank’s risk management strategy.

Risk Management Group

 Chaired by Deputy Managing Director and comprises Group Heads and senior officers of Business Groups, Treasury and Accounts Group, and the

Chief Risk Officer.

 Addresses issues of asset-liability management, interest rate and exchange rate risks, liquidity risk, etc.  Chaired by Deputy Managing Director and comprises Group Heads and senior officers of Business Groups, Treasury and Accounts Group, and the

Chief Risk Officer.

 Addresses rating and pricing standards, prudential limits on various exposure categories (country, sector, single and group borrower and unsecured

exposures, program-wise exposures etc.), sector-wise outlook, etc.

 Chaired by Deputy Managing Director and comprises senior executives who do not have direct line responsibilities and the Chief Risk Officer.  Reviews the Bank’s risk overall profile, risk concentrations, operational risk, compliance with prudential limits and overseeing the operations of

CRMC and ALCO.

 Reviews the Bank’s risk management policies, investment policies and strategy, and regulatory and compliance issues in relation thereto.  Chaired by Deputy Managing Director and comprises of directors appointed on to the Board by the respective institutions (IDBI, ECGC) and the

Central Government and the Chief Risk Officer as a permanent invitee.

 Responsible for implementing the Integrated Risk Management Policy of the Bank, monitoring adherence to various regulatory and internal risk

limits developing policies and procedures for integration of various risks at the Bank level, and review of all policies related to the Bank’s business. Asset-Liability Management Committee (ALCO) Credit Risk Management Committee (CRMC) Integrated Risk Management Committee Risk Management Committee (RMC)

25

Appendix

Financial Highlights

Figures in INR mn FY17 FY18 FY19 3MFY20 Cash and Bank Balance 36,909 28,155 42,120 56,734 Investments 51,029 56,969 93,274 93,817 Loans and Advances(1) 1,026,410 1,075,321 936,171 939,581 Fixed Assets 1,298 1,259 2,277 2,241 Other Assets 56,427 73,486 72,412 78,460 Total Assets 1,172,074 1,235,190 1,146,254 1,170,833 Paid up Capital & Reserves(2) 120,239 96,002 146,736 146,736 Deposits 3,726 2,861 2,528 2,377 Notes, Bonds and Debentures 806,930 865,817 779,196 805,746 Borrowings 150,073 172,973 141,318 133,135 Profit and Loss Account 41

• 82

629 Other Liabilities & Provisions 91,065 97,537 76,394 82,210 Total Liabilities 1,172,074 1,235,190 1,146,254 1,170,833

Note: (1) Includes loans and advances to industrial concerns, scheduled banks, foreign governments and other financial institutions and bills of exchange and promissory notes discounted /

• rediscounted. Amounts stated are net of provisions for non-performing assets (NPAs). ; (2) Includes paid-up capital and reserves.

27

Balance Sheet

Financial Highlights

Figures in INR mn FY17 FY18 FY19 3MFY20

Interest Earned 84,411 82,384 87,266 21,343 Interest Expended 65,022 65,863 67,567 15,782 Net Interest Income 19,389 16,521 19,699 5,561 Non-Interest Income 7,942 5,399 3,700 896 Non-Interest Expense 2,525 2,608 2,718 629 Net Non-Interest Income 5,417 2,791 982 267 Operating Profit 24,806 19,312 20,681 5,828 Provisions and Contingencies 21,680 61,610 18,806 4,104 Profit / (Loss) Before Tax (PBT) 3,126 (42,298) 1,875 1,724 Tax (Net of Deferred Tax) 2,714 (13,061) 1,058 1,095 Profit / (Loss) after Tax (PAT) 412 (29,237) 817 629

28

Profit and Loss Summary

Financial Highlights

FY17 FY18 FY19 3MFY20 Net Interest Margin 1.70% 1.31% 1.56% 1.84% Gross NPA 9.24% 10.37% 11.34% 11.19% Net NPA 4.68% 3.75% 2.44% 2.29% ROAA 0.04%

• ve

0.07% 0.22% ROAE 0.62%

• ve

1.04% 2.76% CRAR 15.81% 10.35% 19.07% 19.62% Core CRAR 14.29% 8.82% 17.71% 18.10% Slippage Ratio 7.02% 4.18% 2.74% 1.16% Credit Cost 2.06% 5.52% 1.72% 1.59%

29

Key Ratios

A

Issuances in International Debt Markets

30 Upto March 2009 FY 2009-10 FY 2010-11 FY 2011-12 FY 2013-14 FY 2015-16 FY 2017-18 FY 2012-13 FY 2014-15 FY 2016-17 FY 2018-19

• USD 250 mn Reg-S
• JPY 5.55 bn Reg-S
• JPY 23 bn Samurai
• JPY 26 bn Samurai
• USD 50 mn Reg-S
• JPY 24 bn Reg - S
• USD 200 mn Reg-S
• JPY 15 bn Reg-S
• JPY 20 bn Samurai
• USD 110 mn Reg-S
• AUD 39 mn + JPY

2.90 bn + ZAR 370 mn Reg-s (Uridashi)

• USD 500 mn Reg-S
• SGD 250 mn Reg-S
• USD 750 mn Reg-S
• USD 500 mn Reg-S
• JPY 20 bn Samurai
• USD 500 mn Reg-S
• USD 1 bn 144A /

Reg-S

• USD 500 mn Reg-S

Samurai Issuance Uridashi Issuance 144A Issuance

• USD 150 mn Reg-S
• USD 300 mn Reg-S
• CHF 190 mn Reg-S
• AUD 200 mn Reg-S
• JPY 11.27 bn +

MXN 286.10 mn + TRY 59.60 mn Reg- S (Uridashi)

• JPY 15 bn Reg-S

(Uridashi)

• USD 500 mn Reg-S
• CNY 300 mn Reg-S
• CNY 300 mn Reg-S
• AUD 164.50 mn +

USD 42.80 mn Reg-S (Uridashi)

• USD 500 mn Reg-S
• USD 400 mn Reg-S

(Formosa)

• USD 1 bn 144A /

Reg-S

• JPY 32 bn Samurai

FY 2019-20

PARTNERING GROWTH. GLOBALISING INDIA.