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Strictly confidential

May 2019

Corporate Presentation

This presentation has been prepared by The Lakshmi Vilas Bank Limited (the “Bank”) solely for information purposes without regard to any specific

objectives, financial situations or informational needs of any particular person. This presentation should not be construed as legal, tax, investment or

other advice. This presentation is may not be copied, distributed or disseminated, directly or indirectly, in any manner. Furthermore, no person is

authorized to give any information or make any representation which is not contained in, or is inconsistent with, this presentation. Any such extraneous

or inconsistent information or representation, if given or made, should not be relied upon as having been authorized by or on behalf of the Bank. This

presentation contains statements that constitute forward-looking statements. These statements include descriptions regarding the intent, belief or

current expectations of the Bank or its directors and officers with respect to the results of operations and financial condition of the Bank. These

statements can be recognized by the use of words such as “expects,” “plans,” “will,” “estimates,” “projects,” or other words of similar meaning. Such

forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those

specified in such forward-looking statements as a result of various factors and assumptions. The risks and uncertainties relating to these statements

include, but are not limited to, (i) fluctuations in earnings, (ii) the Bank’s ability to manage growth, (iii) competition, (iv) government policies and

regulations, and (v) political, economic, legal and social conditions in India. The Bank does not undertake any obligation to revise or update any

forward-looking statement that may be made from time to time by or on behalf of the Bank. Given these risks, uncertainties and other factors, viewers

of this presentation are cautioned not to place undue reliance on these forward-looking statements. The information contained in this presentation is

only current as of its date and has not been independently verified. The Bank may alter, modify or otherwise change in any manner the contents of this

presentation, without obligation to notify any person of such revision or changes. No representation, warranty, guarantee or undertaking, express or

implied, is or will be made as to, and no reliance should be placed on, the accuracy, completeness, correctness or fairness of the information,

estimates, projections and opinions contained in this presentation. None of the Bank or any of its affiliates, advisers, directors, officers, agents or

representatives accept any liability whatsoever for any loss howsoever arising from any information presented or contained in this presentation. Please

note that the past performance of the Bank is not, and should not be considered as, indicative of future results. This presentation does not constitute or

form part of and should not be construed as, directly or indirectly, any offer or invitation or inducement to sell or issue, or any solicitation of any offer to

purchase or subscribe for, any securities of the Bank by any person in any jurisdiction, including in India or the United States, nor shall it or any part of

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This presentation is not a prospectus, a statement in lieu of a prospectus, an offering circular, an advertisement or an offer document under the

Companies Act, 2013, as amended, the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as

amended, or any other applicable law in India.

Disclaimer

2

3

Business Highlights2

Merger with Indiabulls - Update6

Financials of FY 20194

Strategy3

Lakshmi Vilas Bank - Overview1

Table of Contents

4

Lakshmi Vilas Bank- Overview1

Lakshmi Vilas Bank- Overview

5

Overview

Deposit and Advances Evolution

Shareholding (as of 31st March 2019)

One of the oldest banks in the history of banking in India; instituted in 1926

Mainly caters to the South of India with 48 % concentration of business in Tamil

Nadu & Puduchery

Wide coverage and distribution network with presence in 18 states and 1 Union

Territory across India

Consistent growing bank book since FY14 ( Loan book 2x of FY18 wrt.. FY14)

Highly experienced management team with an average of 22-29 years of experience

Focus on CASA; Retail and MSME the cash cows of future; Corporate Adv. continues

to be 34% of book

Bank recently announced the amalgamation with Indiabulls Housing Finance, subject

to RBI and other regulatory and statutory approvals

Promoter & Promoter group

7.1%

Instn Holdings19.9%

Others73.0%

569

branches

4,908

employees19 states

incl. UT

1,046

ATMs

Over 20 lakh

customers

22.5 lakh

accounts

18,57321,964

25,431

30,55333,309

29,279

FY14 FY15 FY16 FY17 FY18 FY19

Deposits (INR cr)

12,88816,352

19,644

23,72925,768

20,103

FY14 FY15 FY16 FY17 FY18 FY19

Advances (INR cr)

Offering Diverse Range of Products and Services

6

Insurance Loans

Deposits

Mutual Fund

Distribution

Internet

Banking

Retail Banking

Group

Corporates

Banking

group

Agri, Commercial &

Development

Banking group

Strategic Business

Units

Caters to individuals, HUFs, trusts and

clubs

As of 31st March 2019, 10 % of Bank’s

loans and advances to retail banking

customers

Caters to MSMEs, emerging businesses

with revenues up to INR 75 crore

annually, and agricultural and allied rural

services businesses

As of 31st March 2019, 56% of Bank’s

loans and advances to MSME

/Rural//Commercial banking customers

Caters to business with revenues above

INR 75 crore annually

As of 31st March 2019, 34%]of Bank’s

loans and advances to Corporate

banking customers

Retail Banking Group

Agri, Commercial & Development

Banking group

Corporates Banking group

Guided by Experienced Board of Directors

7

7

Shri. G Sudhakara Gupta

Non-Independent and Non-Executive Director

With Bank since 2017

Former Director at XS Real Properties Private Limited

Shri. B K Manjunath

Non-Executive Chairman and Independent Director


Practicing Chartered Accountant

Dr. Y.N. Lakshminarayana Murthy

Independent and non – executive Director


Ph.D. holder in Soil Science and Agricultural Chemistry

Smt. Anuradha Pradeep


With Bank Since 2017

Independent Legal practitioner by profession practicing in the High

Court of Karnataka

Shri. Kusuma R Muniraju

Independent and Non-Executive director

With Bank; rejoined in 2016

High Court Advocate in Karnataka

Shri. H S Upendra Kamath

Independent and non-executive Director


Former Director at Canara Bank, Chairman and Managing Director

at Vijaya Bank, Former MD and CEO at Tamilnad Mercantile Bank

Shri. N Saiprasad


With Bank; rejoined in 2019

Managing Partner in M/s Venkateswara Exports, Karur

Shri. Rajnish Kumar

RBI nominee Director

General Manager at RBI

Shri.Suvendu Pati

RBI nominee Director

General Manager at RBI

Shri. Parthasarathi Mukherjee

Managing Director and Chief Executive Officer


Former Group Executive at Axis Bank

Awards

8

NATIONAL PAYMENTS CORPORATION OF INDIA Felicitates LAKSHMI VILAS BANK for FASTEST CTS IMPLEMENTATION in CHENNAI

NATIONAL PAYMENTS EXCELLENCE AWARDS 2014 – Winner (Scheduled Banks – Small Bank Category) for Excellent Performance in National Automated Clearing House - 3rd December 2014

CIO100 SPECIAL AWARDS 2015 - Winner - CLOUD CONQUEROR HONOREE 2015 -IDG award for Cloud Implementation

DQLIVE BUSINESS EXCELLENCE AWARDS2015 for EXCELLENCE IN THE IMPLEMENTATION & USE OF TECHNOLOGY FOR BUSINESS BENEFITS

IDRBT BANKING TECHNOLOGY EXCELLENCE AWARDS 2014-15 - BEST BANK AWARD (AMONG SMALL BANKS) for MANAGING IT INFRASTRUCTURE AMONG SMALL BANKS

MEDAL OF HONOUR for SUCCESSFUL DIGITAL ODYSSEY 2017

BEST CIO CLUB IT AWARD 2017 FINALISTBSE – CIO KLUB OF THE YEAR 2017for Banking Category

IDC INSIGHTS AWARDS 2018 forEXCELLENCE IN OMNI EXPERIENCE

9

Business Highlights2

Strong South India Focused Franchise with Pan India Reach

10

Branch Count (569)

North includes Madhya Pradesh, Uttar Pradesh, Uttarakhand, Haryana, Himachal Pradesh, Jammu & Kashmir, Punjab, Rajasthan, Chandigarh and Delhi;

East includes Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, Bihar, Chhattisgarh, Jharkhand, Odisha, Sikkim, West Bengal and Andaman & Nicobar Islands;

West includes Goa, Gujarat and Maharashtra; South includes Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, Puducherry and Telangana

295

9

1

2

13

24

52

60

13

4

2

2

4

5

4

5

69

1

4

South87%

West6%

North4%

East3%

Metro29%

Rural19%

Semi Urban30%

Urban22%

Branch distribution (March, 2019) Distribution Mix

11%

8%

28%

9%

44% 569

branches

< 1 yr 1-2 yrs 2-5 yrs > 10 yrs5-10 yrs

Coverage Mar ’14 Mar’19

Mar’14 vs

Mar’19

Change

States 16 19 3

Districts 108 147 39

Branches 362 569 207

Total staff 3,292 4,908 1,616

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

Architectural Initiatives to Streamline the Transaction Lifecycle, from

Sourcing to Processing to Servicing

1111

CRM Tool Automated loan origination Enhanced banking platform

100% completion achieved on CRM

Implementation

Key features:

Salesforce Automation and

Leads Management

Campaign Management and

Customer Segmentation to

ensure mass reachout

Analyse leads and take informed

decisions, such as automated

responses to FAQs, automated

escalation, and fixing service

levels based on segmentation

Improve cross-selling and up-

selling capability

Drive CASA to targeted levels

Improve account balances and

income due to better partner sales

management and reduced churn

of customers

Fully automated loan origination

system to ensure uniform processing

through standardized enforcement of

credit terms and conditions; integration

with credit rating modules, and

automatic reporting

Tabs to feet on street for instant

notifications to Corporate office for

commencement of processing

Spreadsheet based upload, followed

by automatic application of defined

business rules and eligibility norms

Reduced time for data entry

Low error rate

Lower TAT

Improvement in

employee productivity

Standardized borrower evaluation

Improved document handling

App with convenient options such

as Favourites, Quickpay, utility

payments, and quick recharges etc.

App launched across iOS, Android,

and Windows platforms

Digital penetration supported by

customer education, marketing

and expansion in branch network

Supreme 2 factor authentication

banking channels across internet

and mobile

ServicingSourcing Processing

Better customer satisfaction

More cross sell opportunities

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

Digital Transformation

New Digital platform for Hosting Internet Banking

12

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

Get information on your

upcoming payments

Get a consolidated

look of your account

Keep tab on your bills and

pay instantly through your

account. Its that easy!!!!

Track your recent activities

and your spends

Get instant notification on

offers and transactions,

Track the status of your

service requests and Track

all your payments

Find your total Net

worth and plan your

targets accordingly

Keep track of all your

account in one place.

Your current and

savings account, Term

Deposit account,

Recurring deposit

account, Loan and

Finance and Credit

card. All the facilities at

one place!!


Multifunction Mobile App with Intuitive Functioning

13

Login with PIN or

Internet Banking

ID

Information not

specific to an account is available

without login

Login page Landing page Fund transfer page

Smart memorization of previous

payment choices exercised –

Leading to one-step payment

One step instant payee

addition

Bill paymentsRecharge

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality


Bank aims to be a front runner in digital offerings

14

Transaction Value in Digital Channels (INR cr) Share of digital and non-digital volume of transactions

Mobile Transactions (INR cr)

109 359 423 500.462,271 1,920

5,184 5748.87

50 918 2,524

6292.88

30 55 116 155.09

6,317

14,006

21,683

34398.62

2016 2017 2018 2019

POS ATM Mobile Ecom Internet

3.9

5.3 5.1

6.5

1.01.2

2.3

3.5

8,777

17,258

29,930

47,096

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

2016 2017 2018 2019

Non digital volume (cr) Digital volume (cr) Digital value (INRcr)

• RTGS & NEFT transactions1 (INR cr)

466

646

844

1,095

1,350

1,526

1,741

2,039

Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19

61,637 65,523

45,218

56,012 53,972

56,635

Q1 FY18 Q1 FY19 Q2 FY18 Q2 FY19 Q3 FY19 Q4 FY19

Source: Company information, RBI

Note: 1 Denotes total transaction value for outward and inward NEFT transactions and consumer inward and outward spends on RTGS

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

Capital Position

15

0.1% 9.0%

16.6%

74.4%

BPLR Base Rate Fixed Rate MCLR

[INR 21,956 Cr]

Q4’19

Capital Ratios have been impacted by increased provisioning for the

non performing book

Rebalancing RWA’s has been taken up by bank

Bank anticpates to better its rating of book qoq

Bank has undertaken repricing of its book in the last 2 quarters; yields

of book has move up.

74% of the Book is linked to its MCLR with majority to its 1 year rate

1106 1027

415 398

1521 142519380 17957

5.57%5.72%

2.00% 2.00%

7.57%7.72%

1%

4%

7%

10%

300

Q3FY19 Q4FY19

Tier-I Capital Tier-II Capital Total Capital

Total Risk Weighted Assets Tier I CRAR (%) Tier II CRAR(%)

CRAR(%)

Capital Position ( Basel III) | RWA | Tier 1 & II Ratios Distribution of Book Across Pricing Mechanism

Capital Conservation Bank has Demonstrated Ability to Raise Capital

Date Amount (INR cr) Type

FY2014 78.4 Tier II

FY2015 406 Rights Issue

FY2016 140 Tier II

FY2017 167.5 QIP

FY2018 780.6 Rights Issue

FY2018 69.7 Tier II

FY2019 459.6 QIP Placement

FY2020* 188.2 Pref. Allotment to IHFL

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

*Resolution undertaken; process underway

On Track to Build a “Retail & SME Focused” Bank

Build a strong CASA franchise

16

Steady Deposit Base

Consistent growth in CASA deposits

% of total depositsINRcr

4,573 4,925 5,093 5,171 5,265 5,552

1,9092,090 1,870 1,719 1,771 1,963

6,482 7,015 6,964 6,890 7,036

7,515

Q3FY18E Q4FY18E Q1FY19E Q2FY19E Q3FY19E Q4FY19E

Savings Current

21.1% 21.1% 25.7%21.4% 22.2%1,520,600 1,769,965

1,808,358

89,647 1,09,765 1,70,108

FY17 FY18 FY19

Savings Current

Increasing Number of CASA accounts

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

22,567 23,898 21,651

5,844 7,015 7,5152,142 2,396

11330,553 33,309 29,279

FY17 FY18 FY19

Bank term CASA Retail term

Stagnated Cost of Deposits

7.30%

6.75% 6.75%

FY17 FY18 FY19

22.8%

On Track to Build a “Retail & SME Focused” Bank

Building a Strong CASA franchise (cont’d.)

17

High interest rates of 5% and 6% to drive CASA growth in

select categories

Capitalize existing customers to acquire HNI accounts and

build client base to cross sell

Savings account

Add-on services on current accounts like cash pickup, cash

management and door step banking

Enlarging sales force with adequate training to offer trade and

foreign exchange services

Current account

Print, OOH, FM, television and mobile van campaigns

Online tests for product education for staff; coupled with

incentives to market CASA products

Promotions

CASA proportion in branches aged <5 years

2018

261 branches2019

[186 branches]

2017

213 branches

Product differentiation and aggressive marketing New branches showing positive results on CASA accumulation

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

CASA32.0%

Term68.0%

CASA26.7%

Term73.3%

CASA18.7%

Term81.3%

Strategy for increasing CASA

Potential to increase CASA as vintage branches turn profitable

Focus on Business Correspondent model to increase CASA

Shift on measuring CASA on a CDAB (Cumulative Daily Average Balance) basis

than on a period end basis

CDAB of CASA saw an increase of 167 bps YoY and 67 bps QoQ

Focus on onboarding customers through Digital channels with Insta opening

optionality

Branches to be redefined as sales outlets with defined CASA targets with a specific

focus on HNI & NRI customers

Product innovation and extension of existing products

Expansion of “Crown” franchise to include NRE, NRO accounts

Attractive interest rates for savings & flexi current account facilities

Aggressive advertising on both digital & offline platforms

Interest Income

18

Net Interest Income and Non Interest Income (INR Cr) Diversified loans and Advances…

Yield on Advances, Cost of Funds and Net Interest Margin …Across Sectors

Corporate34%

Rural18%

MSME22%

Retail10%

Commercial16%

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

INR [21,956] cr

Q4FY19

INR [21,956] cr

Q4FY19

783 791

130 151 139 140

560503

347

61 71 61 57

250

FY17 FY18 Q1'19 Q2'19 Q3'19 Q4'19 FY19

Net Interest Income Non-Interest Income

8.26%8.85% 9.17% 9.09% 9.09%

5.82% 6.02% 5.87% 5.87% 5.86%

1.34% 1.48% 1.74% 1.65% 1.73%

Q4'18 Q1'19 Q2'19 Q3'19 Q4'19

Yield on Advances Cost of Funds Net Interest Margin

Infrastructure38%

Textiles27%

Basic Metal and Metal Products

20%

All Engineering8%

Other industries7%

Income Trend

Diverse Revenue Base

19

147 134 122 116

2016 2017 2018 2019

Fee income % of total income

15.5% 10.4% 10.7%

Insurance Tie ups with insurance behemoths for life, general, and health

insurance

MFs and PMS Investing opportunities customized for small amounts; developing

advisory app with manual intervention for sale of mutual fund products

Credit cards Launched co-branded credit card in partnership with SBI Cards in 2015

Forex travel cards High growth high margin exchange rate driven product, irrespective of

amounts remitted

Others Money transfer and pension schemes

Product Overview Partners

13Mutual Fund affiliations

14.3%

Multiple avenues to boost fee income

Fee income evolution (INR Cr)Other Income Breakdown (INR Cr)

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

116

-18.6

11.7

1.9

22.4

116.5

Commission

loss on Investments

Profit on sale of Asset

Exchange Profit

Dividend

Bad Debts Recovery

Others

Prudent Management of Asset Quality

Adopting Clean-up of Corporate Loan Book…

20

Overview Close tracking of watch list through FY18 & 19 comes to an end

Increased provisioning to augment rising NPAs Corporate NPAs already identified in the book

2,500 2,250

1,725 1,560

400 200

0 0

Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18 H1FY19 Q3FY19 Q4FY19

Announced watch list of INR2,500cr in March 2017

Accelerated NPA recognition in 4Q18 under new RBI guidelines

Watch list reduced from INR2,500cr as of March 2017 to nil as of March,

2019.

The residual stress in corporate book is now contained; additional slippage

shall be overcome by net recovery

MSME and Rural Book has incremental stress reported; shall stagnate

hereafter

386 636 286 1,608

% of total gross NPAs

INRcr633 572

403 573

871 967

1,982 2,068

2,420 2,366


INRcr

67.7% 73.5% 69.7% 71.9%68.1%65.2%63.0%

170 165 217 305

11691335

15791,785


2.67%

INRcr

1.76%

5.66%

4.27%

9.98%

5.66%

13.95%

7.64%

Gross NPA % 12.31%

6.88%

5.50%

4.33%

3.78%

2.84%

Gross slippages of total book (INRcr)

Net NPA %

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

59.5% 46.7% 55.1% 55.9%55.4%46.7%51.3%Provision

coverage ratio

(%)

207

70.4%15.30%

7.49%

62.08%

Prudent Management of Asset Quality

… has led to a better quality loan mix

21

Bank continues to focus on capital preservation

Most of the slippages arose from the lower rated book; higher run off’s of higher rated paper attributed to lessening of weightage in high rated buckets

28.9% 29.4%

43.0%

32.0%

29.6% 28.2%

30.4%

28.4%

4.8% 6.1%

7.1%

7.0%

17.3% 13.6%

14.8% 32.6%

19.5% 22.6%

4.7% 0.0%

FY16 FY17 FY18 FY19

LVB 1/2/3 LVB 4/5 LVB 6/7/8/9 Need not be rated Unrated

17.8%

42.9%

55.6%

40.1% 14.3%

13.4%

17.7%

17.4% 27.5%

21.8%

14.8%

28.8%

40.4%

21.9% 11.9% 13.7%

FY16 FY17 FY18 FY19

A & above BBB < BBB Unrated

Distribution by Internal ratings Distribution by external ratings

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

Overview of NPAs (FY19)

22

NPA movement QoQ (INRcr) NPA overview

Industry Classification of GNPA on FY19

INRcr Mar-19 Dec-18 Sep-18 Mar-18 Dec-17

Gross NPA 3,359 3,364 2,965 2,694 1427

Net NPA 1,506 1,716 1,560 1,458 1060

Gross NPA % 15.30% 13.95% 12.3% 10.0% 5.6%

Net NPA % 7.49% 7.6% 6.9% 5.7% 4.2%

Provision Coverage Ratio % 62.08% 55.9% 55.4% 55.1% 46.7%

Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19

Gross NPA 1427.01 2694.21 2804.72 2964.89 3364.28 3358.99

Net NPA 1060.46 1457.89 1478.09 1560.08 1716.22 1506.29

500

1000

1500

2000

2500

1%

1%

2%

5%

1%

12%

18%

Gems and Jwellery

Other Industries

All Engineering

Textiles

Beverages


Infrastructure

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

3,364 3,364 3,364 3,267

3,359

207 115

98

Opening GNPA Gross Slippage Recoveries/upgradation

Tech write off Closing GNPA /Opening GNPA

MSME Commercial

SMA – Segmental breakdown

Continuous Improvement on account of stringent monitoring

23

Rural Retail Total portfolio

79%

34%

57%

30%

41%

9%

43%

21%

56%

59%

13%23% 22%

14%0%3011

887905

224

446

1002003004005006007008009001000110012001300140015001600170018001900200021002200230024002500260027002800290030003100

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Q4FY18E Q1FY19E Q2FY19E Q3FY19E Q4FY19ESMA2 SMA1 SMA0 Total

Corporate

62% 70%63%

24%19%

19%12%

13%

25%

53%

19% 18%25%

50%

28%1,484

1,208

1,486

735

10450

300

550

800

1,050

1,300

1,550

1,800

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


57%57%

79%

35%

60%

25% 21%

10%

36%

20%

18% 22%11%

29%20%

352

277274

182

28 10

110

210

310

410

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Q4FY18E Q1FY19E Q2FY19E Q3FY19E Q4FY19E

SMA2 SMA1 SMA0 Total

59%

51%58%

24%0%

22%

22%20%

25%

0%

18%26% 22%

51%

100%

350

250

257

136

10

110

210

310

410

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


*CC/OD interest debited on 31.01.19 has not been considered for SMA0

SMA0 data for Q3FY18 is not reported. Bank has reported SMA0 post Feb 2018 circular of RBI

SMA nos. for Q4FY19 are unauditied and may vary subject to the same

Bank

58%

37% 36%47%

45%

19%

23% 27%

22%

0%

23%

40% 37%31%

55%

619

338321

372

11 10

110

210

310

410

510

610

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


70%

53%59%

31%

37%

14%

24%17%

30%

55%

16%23% 24%

39%

8%5,816

2,958

3,245

1,649595

101102103104105106107108109101,0101,1101,2101,3101,4101,5101,6101,7101,8101,9102,0102,1102,2102,3102,4102,5102,6102,7102,8102,9103,0103,1103,2103,3103,4103,5103,6103,7103,8103,9104,0104,1104,2104,3104,4104,5104,6104,7104,8104,9105,0105,1105,2105,3105,4105,5105,6105,7105,8105,910

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Credit Risk Management Framework

Bank has enhanced its way of assessing business

24

Industry exposures tracked and dynamically set up

Achieve granularity of exposures

Cap exposures to below-BBB rated exposures

Generate 2/3rd of corporate advances incrementally from A and above

borrowers

Tighten rating standards and target higher RAROC on exposures

Preparing for ECL under Ind AS regime

Limiting exposures largely to A and above rated borrowers

Setting credit risk policy

Complete review and bringing in IMaCS Rating System

Use of external inputs from rating agencies, credit information bureaus

Focus on increasing MSME exposures

Retail Asset rollout through dedicated Credit teams

Improvement in sanction and disbursement TAT

Tighter management of portfolio/market risk/ ALM

Tight management of capital

Engaging with external providers of information on borrower universe

and taking up special informational reports

Build work flow based sanction processes drawing external inputs

Transitioning into credit operations through special branches

Mandating cleaning of historic data and separate credit operations and

monitoring

Standardizing documentation and improving customer experience

Ongoing steps to manage credit risk

Steps taken to manage credit risk

Pan India

reach

Digital

Transformation

Capital

PositionDeposits

Income

Trends

Asset

Quality

Strong asset liability management framework ( as on 31st March, 2019)

25

Established ALM framework

ALM policy

Stress Testing Policy

Counterparty Risk Management Policy

Market Risk Management Policy

Reporting

ALCO

Managing ALM using system driven environment

Review and Monitoring of Funding Plans on an ongoing basis

Creation of Balance Sheet Management Group to manage CFU

Bank maintains surplus SLR for liquidity purposes

Integral part of ALM is building up Retail Term deposits

ALM group runs MCLR computation

Hedging policy for Balance Sheet Management in place

Derivatives capabilities being built in upgraded Treasury system

Counterparty Limits managed out of ALM

Lia

bilit

ies

Assets

349 696903

6221065

628

1595

3605

12005

904

6908

0 253 0 0 0 0 0 0351

78 240128727 848 1090

1928 1841

347

1110

8431

1281

2397

1735

229 178 126 209 153 359826

2647

491

1613

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

1 D

ay

2-7

Days

8-1

4 D

ays

15-3

0 D

ays

31 d

ays &

upto

2m

onth

s

Mo

re than 2

mo

nth

s &

upto

3 m

onth

s

3-6

Mo

nth

s

6 M

onth

s-1

Year

1-3

Yea

rs

3-5

Yea

rs

Over

5 Y

ears

INR

cr

Deposits Borrowings Advances Investments

Audited statement

26

Strategy3

Strategic Initiatives for Business Structuring

27

Separate retail lending group established

Focus on profitable gold loans, business credit and home loans

Project TRANSME: Transformation of the MSME business model

Relationship management team: One-stop shop for all financial needs of customers

Focus on high-rated clients

Conscious de-focusing on the wholesale business segment

Loan Book:

Retail & MSME

Focus

Branch expansion; Potential to increase CASA with new branches turning profitable

Branches being redefined as sales outlets with defined CASA targets

Specific focus on HNI & NRI customers

Product innovation and extension of existing products

Attractive interest rates for savings account & flexi current account facilities to drive CASA growth

Aggressive advertising on both digital & offline platforms

Liability:

Increasing

CASA

Transaction Banking vertical launched to boost fee income

Focus on trade finance, bill discounting, guarantees, LCs, cash management, government banking

Tie-up with third parties for insurance, mutual funds, credit cards, money transfer, forex travel cards

Fee Income

Initiatives across the transaction lifecycle - CRM tool, automated loan origination

Multifunction mobile app with intuitive functioning for a state-of-the-art customer interface

Implementation of large-scale technological reforms

Upgrade core banking suite, develop business intelligence unit, enhance digital banking & omni-channel presence, multi function e-

lounge, Oracle Financial product suite

Technology

Overhaul of risk management framework to enhance credit risk management systems & processes

Separate Recovery Vertical & empanelment of recovery agencies to reduce TAT of recovery

Demarcate operations between business setups & improve asset quality in the future

Conduct of high value credit portfolio under constant monitoring guided by technology

Asset Quality:

Revamped Risk

Management

Framework

1

2

3

4

5

Transformation Work Streams : Strategy for Next 3 Years

28

People Transformation

Organization design, recruitment,

training and performance management

Relationship Management structure

Branding & Communication

Active brand endorsement

Extensive analyst coverage

Proactive communication with

customers

Technology Transformation

Applications and Hardware

implementation

OFSAA Launch

Core Banking upgrade and

Digital Banking full suite launch

Service Delivery, Processes, Policies

and Manuals

Design and documentation of operating

principles

Risk, Compliance, Finance and

Treasury & Capital Markets

Implementation of support and control

functions

Robust early warning signal system

implementation

Regulatory & Business

restructuring

Provisioning

NCLT Case(s) exits

Capital Raise

Business unit individual

assessment

Business Transformation

Omni-channel strategy | market capture

Full scale relationship management

implementation

Less focus on Treasury Income

Drive to enhance cross-sell

29

Financials4

30

Key Performance Highlights - FY 20192

31

Key Performance Highlights – FY19

As of 31st March 2019 Gross Loan book stands at INR 21956 cr

(-)18.70 % Y-o-Y growth in loan book; (-) 8.98% Q-o-Q growth in loan book

MRC book : 17 % Y-o-Y growth ; and Corporate Book reduced by 46 % Y-o-Y

Loan book

Total net interest income at INR 560.14 cr; down 29.15 % Y-o-Y.

Operating loss at INR 11.97 cr;

Net Loss at INR 894.10 cr; up 53 % Y-o-Y.

Profitability

Tier 1 CRAR at 5.72 %

Tier 2 CRAR at 2.00 %Capital position

Provision coverage ratio at 62.08 %

Gross NPA at 15.30 % vs Gross NPA at 13.95 % in Q3’19

Net NPA at 7.49 % vs Net NPA at 7.64 % in Q3’19

Asset Quality

As of 31st March 2019, total deposit stands at INR 29,279 cr

CASA ratio at 25.67 %

Deposits

Operational

Total customer base around 2.19 million

569 branches :– of which 162 in Metros, 125 in Urban, 173 in Semi Urban and 109 in rural Centers in 18 states and 1

union territory

Key Performance Highlights – Q4 FY19

32

Net Interest

Income

Total Income

Operating Profit

Net Profit

Other Income

INR 140.20 cr

INR 57.48cr

INR 739.73 cr

INR (21.19) cr

INR (264.43 ) cr

Y-o-Y Growth

16.37%

50.07 %

(0.16) %

69.38 %

57.50 %

1.01 %

(5.96)%

(2.98) %

15.55 %

29.20%

Q-o-Q Growth

Key Performance Highlights – Balance Sheet

33

Loans & Advances

Deposits

CASA

Borrowings

Investments + Cash

Balances

INR 21,956 cr

INR 10,367 cr

INR 29,279 cr

INR 7515 cr

INR 921 cr

Y-o-Y Growth Q-o-Q Growth

(18.7) %

(17.5) %

(12.1)%

7.1 %

(77)%

(9.0) %

(9.1)%

(4.9) %

6.8 %

(63.6)%

Key Performance Highlights – Key Ratios

34

Net interest Margin

Net NPA

Tier 1 CRAR

CASA Ratio

Gross NPA

1.73%

15.30%

7.49%

5.72%

INR 7514.76 cr

(25.67%)

Y-o-Y Growth Q-o-Q Growth

7.12 % 6.80 %

39 bps 8 bps

135 bps532 bps

(15) bps183 bps

15 bps233 bps

Income Statement

35

INRcr FY17 FY18 FY19 Y-o-Y Change Q3’19 Q4’19 Q-o-Q Change

Interest earned 2,847 3,042 2840 (6.64)% 701 682 (2.71)%

Interest expended 2,064 2,251 2280 1.29 562 542 (3.56)%

Net interest income 783 791 560 (29.20)% 139 140 0.72%

Other income 503 347 250 (27.95)% 61 57 (6.56)%

Total income 1,285 1,137 810 (28.82)% 200 197 (1.50)%

Total Operating expenses 651 782 822 5.12% 225 219 (3.11)%

Employees cost 335 392 401 2.30% 111 111 0

Other operating expenses 317 390 421 7.95% 114 107 (6.14)%

PPOP 634 355 (12) (25) (21)

Provisions and Contingencies 254 1,306 1276 (2.30)% 431 479 11.14%

Profit before tax 380 (951) (1288) (456) (500) 9.65%

Tax expenses 124 (366) (394) 7.79% (83) (236) 184.34%

Net income 256 (585) (894) (373) (264)

Earnings Per Share

Basic 14.07 (28.29) (34.66) (14.59) (10.02)

Diluted 13.95 (28.11) (34.59) (14.54) (10.00)

Balance Sheet

36

INRcr FY17 FY18 FY19 Y-o-Y Change

Capital 191 256 320 24.96%

Reserves & Surplus 1,945 2,072 1573 (24.10)%

Deposits 30,553 33,309 29,279 (12.10)%

Borrowings 1,773 4,013 921 (77.04)%

Other Liabilities &. Provisions 782 779 953 22.32%

Total liabilities and equity 35,245 40,429 33,046

Cash & balances with RBI 1,455 1,698 1654 (2.59)%

Balances with banks, money at call & short notice 169 317 515 62.74%

Investments 8,652 10,768 8,430 (21.71)%

Advances 23,729 25,768 20,103 (21.98)%

Fixed Assets 359 402 470 16.90%

Other Assets 881 1,476 1874 26.94%

Total assets 35,245 40,429 33,046

37

Merger with Indiabulls5

Transaction Details

38

Transaction overview

Swap ratio

Employees

Proposed Management

and shareholding

structure

Shareholder value

creation

Lakshmi Vilas Bank announced on 5th April 2019 and 3rd May 2019 the amalgamation of Indiabulls Housing Finance (IBH) &

Indiabulls Commercial Credit Limited (ICCL), a 100% subsidiary of IHFL into and with Lakshmi Vilas Bank Limited (LVB) subject to

approvals including from RBI and other regulatory and statutory authorities

Share swap ratio: 7,143 equity shares of face value of Rs. 10 each held in LVB for every 1,000 equity shares of face value of Rs. 2

held in IBH has been agreed upon by the respective Board of Directors

All the staff and employees of LVB on the Effective Date(1) shall become the staff and employees of IHFL, without any break or

interruption in services and on same terms and conditions on which they are engaged by LVB as on the Effective Date

Mr. Sameer Gehlaut to be proposed as Vice Chairman of the amalgamated entity

Mr. Parthasarathi Mukherjee and Mr. Gagan Banga to be proposed as Joint M.D.

Mr. Ajit Mittal to be proposed as Executive Director

Mr. K.R. Pradeep shall be appointed as non-independent, non-executive Director

Existing LVB shareholders to hold c.[7.5%] of the combined entity

Proposed swap ratio indicates a substantial premium on market price as on the date of announcement for shareholders of LVB

Status update

LVB and IBH have submitted an application to RBI seeking an approval of the proposed scheme of merger

Applications for approval from CCI is also underway

Combined Entity to be Amongst the Top 10 Private Banks by Size

and Profitability

39

As on December 31, 2018 Amalgamated Entity

Net Worth (Rs. Crs) 19,472

Loan Book (Rs. Crs) 1,23,393

Operating Profit (Rs. Crs) 4,630

Net Profit (Rs. Crs)2,455

Capital Adequacy Ratio 20.6%

Tier 1 ratio 14.4%

Return on Assets (Annualized) 2.0%

Return on Equity (Annualized) 19.2%

Gross NPA 3.5%

Net NPA 2.0%

Strong Capital and Financial Position

• Well Capitalized combined entity with CAR at over 20%, well in excess of regulatory

requirement of 10.875%

• Healthy Credit Profile with Net NPAs down to c.2.0%

• Improvement in ROAs/ROEs from -2%/-41% to 2%/19% due to better profitability of IBH

• Negates need for additional capitalization in the next three years

Opportunity for growth and diversification

• Ability to diversify loan book from largely wholesale to retail

• Opportunity to cross-sell banking products given large retail customer base, as well as

geographical spread of IBH

• Cost efficiency through adoption of IBH’s technology

Improved market perception and access to key shareholders of IBH

• Successful track record of capital raising

• Healthy Credit profile with long term rating of AAA from all leading rating agencies in

India, including CRISIL

• Strong Liability profile backed by business relationships with 622 institutions which

includes 21 PSU banks, 26 Private and Foreign Banks and 575 Mutual Funds,

Provident Funds, Pension Funds, Insurance Companies and Corporates

(1) As on 31 December 2018

(2) All financial metrics based on pro-forma analysis as on 31 December 2019

Appendix

Movement in Gross NPAs

41

640

1278

2694

1022

1894

(172) (212))

(478)

(0)

Opening GNPA Gross Slippage Recov./upgrad./wo Tech write off Closing GNPA /Opening GNPA

Gross Slippage Recov./upgrad./wo Tech write off Closing GNPA /Opening GNPA

March 2017 September 2017March 2018

2694 2965

780 3359633 (300)

Opening GNPA Gross Slippage Recov./upgrad./wo Tech write off Closing GNPA /Opening GNPA

Gross Slippage Recov./upgrad./wo Tech write off Closing GNPA /Opening GNPA

(362)

86

March 2018 September 2018March 2019

Movement of GNPA (INRcr)

Overview of Restructured Assets

42

727 648

596

283

264

267

25

14 14

1,035

926 877

2017 2018 2019

Restructured fund based SDR Flexible structuring S4A

1

3

6

19

25

24

86

86

158

166

303

Print Pack

Shipyard

Gems & Gold

Textiles

Others

Pharma

Communication

Metals & Minerals

Power

Iron

Infrastructure

Restructured assets (INRcr) Industry wise restructured assets (FY19)

Sectoral GNPA classification across industry

43

Leather and Leather products

Chemicals and Chemical Products (Dyes, Paints, etc.)

Vehicles, Vehicle Parts and Transport Equipments

Paper and Paper Products

Mining and Quarrying

Cement and Cement Products

Rubber, Plastic and their Products

Wood and Wood Products

Food Processing

Glass & Glassware

Other Industries

Gems and Jwellery

Beverages (excluding Tea & Coffee) and Tobacco

All Engineering

Textiles


Infrastructure

0.0 100.0 200.0 300.0 400.0 500.0 600.0 700.0

Q4FY19 Q3FY19

Sectoral GNPA classification across Non-industry

44

NBFCs

Agriculture and Allied Activities

Professional Services

Computer Software

Vehicle /Auto Loans

Consumer Durables

Tourism, Hotel and Restaurants

Housing Loans (incl. priority sector Housing)

Educational Loans

Commercial Real Estate

Other Retail Loans

Transport Operators

Other Services

Advances against Fixed Deposits (incl. FCNR(B), etc.)

Wholesale Trade (other than Food Procurement)

Retail Trade

Other Non-food Credit, if any, please specify

0 100 200 300 400 500 600 700 800 900 1000

Q4FY19 Q3FY19

Thank You

https://www.youtube.com/watch?v=TRVbrwh4dAQ

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