Wednesday, June 29, 2011




Annual Reports of companies provide in-depth info about the Industry and the company. They also provide insights into future potential of the company.

Dena Bank’s Annual report for FY 2011 is now at hand and its salient points are presented below.

Banking Sector :

Non-food credit Growth has been above 20%.

Credit growth has been 21.38% and Deposit Growth has been 15.84%. Credit growth has been much more than Deposit Growth in percentage terms in FY 2011. Banks therefore raised Deposit rates significantly to attract more deposits. Lending rates have also been increased.

Performance of Dena Bank :

Business Mix has crossed the LAND MARK figure of Rs.1 lakh crores and  increased from Rs.87066.36 cr to Rs.1,09,372.99 cr by end of FY 2011 – a Growth of 25.62%

Total Deposits have grown to Rs.64209.62 cr  in FY 11 from Rs.51344.28 cr in FY 10 – a growth of 25.05%.

Total Advances have grown from Rs.35721.41 cr  in FY 10   to  Rs.45163.37 cr   in FY 11 – a growth of 26.42%.

CASA increased by 24.15% in FY 11 compared to  increase of 23.01% in FY 10. In absolute terms, it increased by  Rs.4424 cr.

Total Income increased by Rs.968.38 cr (21.06%) and stood at Rs.5567.37 cr – compared to Rs.4598.99 cr in FY 10.

Interest income increased to Rs.5033.53 Cr in FY 11 ( 25.51%).

Net Interest Income increased substantially by 60.3% and stood at Rs.1763.37 cr – compared to Rs.1100.03cr in FY 10.

Fee Based Income increased by 21.21% from Rs.309.58 cr in FY 10 to Rs.375.25 cr in FY 11.


OPT increased to Rs.1223.79 cr in FY 11 from Rs.840.58 cr in FY 10 –an  increase of 45.59%.

Net Profit has increased from Rs.511.25 cr in FY 10 to Rs.611.63 cr in FY 11 – after providing for the  pension liability  of retired and serving employees as required by the rules.(Rs.206.42 cr)- an increase of 19.63%.

Dividend has been enhanced from 20% last year to 22% in current year.


Gross NPA Ratio increased marginally to 1.86% in FY 11 from 1.80%  in FY 10.

Net NPA Ratio stood at 1.22% in FY 11 against 1.21% last year.

Provision Coverage Ratio stood at 74.62% -well above the required 70%.

The Bank had an all time HIGH recovery of Rs.134.58 cr from its  written-off accounts


Dena Bank allotted 4.65 cr Equity shares of FV Rs.10 at a Price of Rs.115.75 (Including a premium of Rs.105.75 )aggregating Rs.539 cr, to Govt of India on preferential basis. With this. Govt’s holding increased from 51.19% to 58.01%.

The CRAR (capital to Risk Asset ratio) is 13.41% now compared to 12.77% last year – against the requirement of 9%.

Net Worth of Dena Bank is Rs.3366.43 cr in FY 11 compared to Rs.2201.64 cr in FY 10., a growth of Rs.1164.79 cr ( 52.91%).


68 New Branches were opened in FY 11.Total now is 1291 Branches – all under CBS.
It has 496 ATMs now.

Net Interest Margin has increased from 2.61% in FY 10 to 3.17% in FY 11.

Return on Assets has decreased very marginally from 1.01% in FY 10 to 1.00% in FY 11.

Cost to Income Ratio has come down from 50.22% to 47.73%

CRAR under BASEL II has increased from 12.77% to 13.41%

Cost of Deposit has come down from 6.21 5 to 5.76%

Cost of funds has decreased from 6.31% to 5.87%.

Yield on Advances has come down from 10.32 to 10.24.

Yield on Fund has increased from 8.47 to 8.62

Return on Equity  has increased from 23.55% to 26.71%

Earnings Per share has gone up from Rs.17.83 to Rs.21.26 on a Face value of Rs.10

Book Value has gone up from 84.04 to 123.85.

Our Assessment :

Dena Bank is a very stable Bank and is progressing at a very fast pace. The Government has infused funds at the price of Rs.115.75, which is actually the real worth of the Dena Bank.  But the current market price is hardly Rs.89.

The EPS has been recording healthy increase with every quarter in the past. In Q4 FY 11, the Paid-up Equity has increased to Rs.333.39 from Rs.286.82 cr existing in Q3 FY 11. On this enhanced Equity, the annual EPS for FY 11 comes to Rs.21.26.

With the increase in equity at a good premium through funds from the GOI – we can expect the bank to clock very good business mix in Q1 FY 12 onwards and achieve very good net profits and EPS from current quarter onwards. Even on this EPS, the current price earnings ratio is hardly 4 – which is very low for this progressive bank. The GOI’s assessment of  Rs.115.75 as the Fair price for Dena Bank – is  quite appropriate at current EPS levels.

PS : The Bank’s Results were earlier reviewed at :

Readers can see the same also.

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Monday, June 27, 2011



In our Childhood, we have heard the story of the 4 Bulls and the Lion. When the 4 Bulls were together, the Lion was afraid of them. When, the 4 Lions separated and were unwilling to help each other – the Lion ate them, one by one.

At first it was just Anna Hazare and a disparate team, which was trying to fight the Government on the Lok Pal Bill. There was no great semblance of Unanimity in the civil society represented by Team Anna initially.

And Politicians were trying their best to give bad name to each member of the team Anna. We all saw that.

Then came Ram Devji with a lot of enthusiasm. He was a staunch nationalist – but not experienced enough to tackle the tricks of wily Politicians. Some of his demands were better than those of Team Anna – but some demands were impractical.

The Politicians were harping on them. We were told through media and news papers at one point of time that most of his demands were accepted by Government ! But, Now – nobody knows what happened to those accepted Demands!!

Ram Devji admittedly had greater following than Team Anna. All over India. But no one expected the midnight attack on peaceful, sleeping Satyagrahis at the Ramlila Maidan. We find a perfectly peaceful, RajBala today in a paralyzed state. We find many in injured state. We do see lathis being used on defenceless people – on many TV  channels, though, even the reporters were not awake fully at that time. Can, we, in that sort of a midnight charging, expect statesmanlike reactions from Ramdevji and his team?

This is one side of the Picture.

In the background of this – we need to assess Team Anna’s reactions. 

Politicians are bent on giving Ram Devji a Bad name – by calling him RSS.

But, did we, and, did you, Team Anna, not see Muslims, Christians, Buddhists and all other religionists on dais with RamDevji at RamLila Maidan and even earlier? We did see on TV Channels all religionists speak on the Dais. Team Anna also was there.

I do watch his yoga karyakram on TV channels daily in the morning for a few years now – and I also do the asanas and pranayam along with the instructions he gives on TV. I am yet to hear even once – one word against any religion during his Yoga Karyakrams. In fact, he used to emphasize the uniformity and equality of all religions and the need to be together. Would RSS do that? I strongly doubt that. I do not think RSS can support the extraordinary religious tolerance and liberalism of Ram Devji. Even Ram Devji’s songs and prayers are absolutely religion-neutral.

I am not a follower of Ram Devji in any sense – and I also do not agree with some of his Demands. But, I do like his method of Yoga for Health and his propagation of Ayurved – and I can vouch that his Yog and his Ayurved do work. His sincerity, in my opinion, is undoubtable. For that matter, I also do not agree with some of Team Anna’s demands too. Such differences are bound to be there in Individual Opinions.

Simply because one or two RSS workers came and sat one day at his place does not make him or his agitation an RSS sponsored one. That is the easiest way for Politicians to divide Team Anna and  RamDevji. That ploy of Politicians has obviously worked – and Team Anna has fallen for it.

In my opinion, a similar, slightly different  ploy against any other member of Team Anna would have divided Team Anna also.

Now, Team Anna should decide – if they are willing to fall prey to this divisive mindset – or, persuade RamDevji for a more practicable, moderate agenda and include him too. Don’t give an absolute Nationalist like Ram Devji a bad name. There are not many, of that caliber. It may suit some others Politicians – who do not want a strong Lok Pal Bill. 

But, it does not suit Team Anna – to keep Ram Devji out of this fight against Corruption. But, for the present, Ram devji also must focus on strong Lok Pal. Other things can be fought a few months later – and together again. If the 4 Bulls learn to stick together – they win. But, of course, Team Anna can always ask the Government – what happened to those ACCEPTED DEMANDS of Ram Devji.

This Blog had also suggested inclusion of a few members of Parliament from the Opposition in the Panel. This has not happened. Team Anna also looked heavily hesitant – to seek such more inclusive panel, which would have ensured consensus or majority even before the Bill goes to Parliament.

Now – there is always a question mark on what the opposition will say in Parliament. They have NOT BEEN formally invited to give any opinion by the Government so far. So, their opinions will come in Parliament.
Team Anna must also make efforts to seek support from all corners – and accept it gracefully from all corners.

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The Annual Report of the South Indian Bank for 2010-11 is now available. Salient performance details of the bank as per the Annual Report are given below : The annual results were earlier covered in the Blog under the following URL in which mostly the Q4 FY 11 results only were covered : 

The PERFORMANCE OF THE BANK as per the Annual report for the whole year of FY 2011 are as follows. Comparison with FY 2010c is also furnished :

The performance highlights of the Bank for the financial year ended March 31, 2011 are as follows:

Key Parameters ::Rs. in Crore
2010-11::      2009-10
o   Deposits ::                  29721.00 ::                23012.00
o   Gross Advances ::      20659.00 ::                15970.00
o   Total Gross Business :: 50380.00 ::             38982.00
o   Net Profit ::                292.56 ::                      233.76
o   Capital & Reserves :: 1845.16 ::                   1484.71
o   Capital Adequacy (%) –Basel-I 13.17 ::       14.73
·         Basel-II 14.01::15.39
o   Earning Per Share (EPS) :
o   (a) Basic EPS (in `)    ::        2.59 ::                2.07
o   [face value `1/-]
o   (b) Diluted EPS ( in `)   ::   2.58 ::                    2.06
o   [face value `1/-]
o   Book Value per Share (in `) :: 16.33  ::          13.14
o   [face value `1/-]
o   Gross NPA as % of Gross Advances ::1.11::   1.32
o   Net NPA as % of Net Advances :: 0.29 ::         0.39
o   Return on Average Assets (%) ::     1.05 ::     1.07


The Bank has achieved a record net profit of Rs.292.56 Crore during the year registering a growth of 25.15% over the previous year. The Bank could achieve this quantitative enhancement in net profit essentially on account of higher scale of operations and better management of assets and liabilities of the Bank.

The Profit and Loss Account shows an Operating Profit of  Rs.548.08 Crore before depreciation, tax and provision.


The Board of Directors has recommended a dividend of 50% (tax-free in the hands of shareholders), i.e., @ `0.50/- per Equity share of face value of `1/- per share as against 40%, i.e. `0.40/- per share declared last year.


During the year, the Bank opened 61 new branches and 116 ATMs across the country. The Bank has been successful in widening its coverage across the country with 641 branches and 3 extension counters transforming it to a pan Indian Institution. 

The branch network now covers 26 states/union territories and has a network of 489 ATMs. The Bank plans to open more new branches and ATMs in the current financial year so as to reach the corporate goal of 700 Branches and 600 ATMs by March 31, 2012.


The Capital to Risk Weighted Assets Ratio (CRAR) of the Bank as on March 31, 2011 according to Basel I guideline is 13.17% as against the statutory requirement of 9%. Tier I CRAR constituted 10.60% while Tier II CRAR represented 2.57%.

The Capital to Risk Weighted Assets Ratio(CRAR) of the Bank as on March 31, 2011 according to Basel II guideline is 14.01%, as against the statutory requirement of 9%. Tier I CRAR constituted 11.27% while Tier II CRAR worked out to 2.74%.


The Bank could achieve a total gross business of  Rs.50380 Crore, consisting of total deposit of Rs.29721 Crore and gross advances of Rs.20659 Crore as on March 31, 2011 registering a growth of 29.24% over the previous year.

In CASA segment, the Bank has achieved a year to year growth of 20%.

During the year 2010-11, 7.51 Lakh new SB A/cs were opened, of which, 2.82 Lakh accounts belong to students. This was specifically aimed at inculcating banking and savings habit among the younger generation


As a result of the various initiatives taken, the Bank could recover NPAs to the tune of Rs.167.24 Crore during the year against the target of  Rs.180 Crore. The Gross and Net NPAs of the Bank as on March 31, 2011 were Rs.230.34 Crore and Rs.60.02 Crore against Rs.211.00 Crore and  Rs.61.57 Crore respectively as on March 31, 2010.

The Percentage of Gross NPA to Gross Advance came down from 1.32% as on March 31, 2010 to 1.11% as on March 31, 2011. Another encouraging achievement in NPA management was that the Bank could reduce the percentage of net NPA to net Advances from 0.39% to 0.29% as on March 31, 2011, a level comparable with the best in the industry.

Overall – the performance of the South Indian  Bank for FY 2011 is quite good . The expansion program for current year is also impressive. So, we can expect much better performance in current year.

According to the Announcement issued to NSE  dt  26-05-2011, The South Indian Bank Limited has decided to raise capital by way of a QIP issue of Equity shares not exceeding Rs. 40 crore in nominal value, the time of issue to be decided later.

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